May 15, 2013

TELL-TALE APPLICATIONS:

IRS Sent Same Letter to Democrats That Fed Tea Party Row (Julie Bykowicz and Jonathan D. Salant, May 14, 2013, Bloomberg)

The Internal Revenue Service, under pressure after admitting it targeted anti-tax Tea Party groups for scrutiny in recent years, also had its eye on at least three Democratic-leaning organizations seeking nonprofit status.

One of those groups, Emerge America, saw its tax-exempt status denied, forcing it to disclose its donors and pay some taxes. None of the Republican groups have said their applications were rejected.

Progress Texas, another of the organizations, faced the same lines of questioning as the Tea Party groups from the same IRS office that issued letters to the Republican-friendly applicants. A third group, Clean Elections Texas, which supports public funding of campaigns, also received IRS inquiries.

In a statement late yesterday, the tax agency said it had pooled together the politically active nonpartisan applicants -- including a "minority" that were identified because of their names. "

Notes on a Trumped Up Scandal : The IRS fiasco shows that conservatives can be PC too (NOAM SCHEIBER, 5/15/13, New Republic)

It turns out that the applications the conservative groups submitted to the IRS--the ones the agency subsequently combed over, provoking nonstop howling--were unnecessary. The IRS doesn't require so-called 501c4 organizations to apply for tax-exempt status. If anyone wants to start a social welfare group, they can just do it, then submit the corresponding tax return (form 990) at the end of the year. To be sure, the IRS certainly allows groups to apply for tax-exempt status if they want to make their status official. But the application is completely voluntary, making it a strange basis for an alleged witch hunt.

So why would so many Tea Party groups subject themselves to a lengthy and needless application process? Mostly it had to do with anxiety--the fear that they could run afoul of the law once they started raising and spending money. "Our business experience was that we had to pay taxes once there was money coming through here," says Tom Zawistowski, the recent president of the Ohio Liberty Coalition, which tangled with the IRS over its tax status. "We felt we were under a microscope. ... We were on pins and needles at all times." In other words, the groups submitted their applications because they perceived themselves to be persecuted, not because they actually were.

Fine--there's no law against neurosis. But, to borrow a thought experiment from my colleague Alec MacGillis, consider all this from the perspective of the IRS's Cincinnati office, which handles tax-exempt groups. You're minding your own business in 2009 when you start to receive dozens of applications from right-leaning groups, applications you didn't solicit and don't require. You peruse a few of the applications and it looks like many of the groups, while claiming to be "social welfare" organizations, have an overtly political purpose, like backing candidates with specific ideological agendas. Suffice it to say, you don't need an inquisitorial mind to decide the applications deserve careful vetting. One Tea Party activist from Waco, Texas, has complained that an IRS official told her he was "sitting on a stack of tea party applications and they were awaiting word from higher-ups as to how to process them." The quote is intended to sound nefarious--an outtake from some vast left-wing conspiracy--but it's actually perfectly straight-forward: The IRS was unexpectedly flooded by dodgy 501c4 applications and was at a loss over how to manage them.2

So the crime here had nothing to do with "targeting" conservatives. The targeting was effectively done by the conservative groups themselves, when they filed their gratuitous applications. The crime, such as it is, was twofold. First, in the course of legitimately vetting questionable applications, the IRS appears to have been more intrusive than justified, asking for information about donors whose privacy it should have respected. This is unfortunate and intolerable, but not quite a threat to democracy.

Second, the IRS was tone deaf to how its scrutiny would look to the people being scrutinized, given that they all subscribed to the same worldview, and that they were already nursing a healthy persecution complex. Which is to say, the IRS didn't go about its otherwise legitimate vetting in a very politically-correct way. "It's part of their job to look for organizations that may be more likely to have too much campaign intervention," a law professor named Ellen Aprill told The Washington Post. "But it is important to try to make these criteria as politically neutral as possible." 

If you act like you're guilty of something you tend to get more scrutiny, no?
Posted by at May 15, 2013 11:38 AM
  

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