An IREHR Special Report
While it is well-known that the so-called IRS scandal has been used by Tea Partiers to bash the IRS, less well known are the actual facts of the case.
Some of the flagged groups did have their tax-exempt status delayed or did face some additional scrutiny, but not a single group has been denied tax-exempt status.
A May 14 draft report by the Treasury Inspector General for Tax Administration found that none of the 296 questionable applicants had been denied, “For the 296 potential political cases we reviewed, as of December 17, 2012, 108 applications had been approved, 28 were withdrawn by the applicant, none had been denied, and 160 cases were open from 206 to 1,138 calendar days (some crossing two election cycles).” (p. 14)
In fact, the only known 501(c)(4) applicant to recently have its status denied happens to be a progressive group: the Maine chapter of Emerge America, which trains Democratic women to run for office. Although the group did no electoral work, and didn’t participate in independent expenditure campaign activity either, its partisan nature disqualified it from being categorized as working for the “common good.”
The Inspector General’s report found that in the “majority of cases, we agreed that the applications submitted included indications of significant political campaign intervention.” (p. 10). In fact, only 91 of the 296, roughly 31%, of the applications reviewed for the report did not have “indications of significant political campaign intervention.” In other words, more than two thirds of those flagged for processing by a team of specialists had those indications.
IREHR Investigation Reveals Further Questionable Activity
That sort of political campaign intervention would normally disqualify a group from 501(c)(4) status, but the deluge of Tea Party applications combined with the politicization of the process has allowed them to slip through. A closer look by IREHR at the activities of some of the Tea Party groups that are currently under review or have received non-profit status from the IRS, reveals a difficult and dangerous situation.
The First Coast Tea Party Inc. of Jacksonville, Florida, for example, which applied for 501(c)(4) status in 2009 and received it in 2011. Commenting about the recent IRS controversy on Facebook, the group declared “We file a tax return, account for every penny.. We do not endorse candidates that is a no no.” Yet the group’s activities included public bragging about directly helping Republican campaigns. In an August 30, 2012 Facebook post, for instance, the group advertised a Jacksonville rally for Republican presidential candidate Mitt Romney and his vice presidential nominee Paul Ryan, adding, “bring your chairs and your signs, make sure they know that the First Coast Tea Party is and has been helping their campaign.”
Three weeks later the group declared a “state of emergency” on Facebook, pleading with supporters to campaign for Romney, “FLORIDA FRIENDS, IF YOU LIVE IN ANY OF THESE 3 COUNTIES GET OFF THE COUCH NOW, GET YOUR FRIENDS OFF THE COUCH. GET TO THE REPUBLICAN HEADQUARTERS AND OFFER AND THEN DO SOME WORK. PHONES, (YOU CAN EVEN DO THESE CALLS FROM HOME) AND WALK AND KNOCK. NOW. WE CANNOT LOSE FLORIDA TO OBAMA.. NOW. THIS IS MOST CRITICAL.” [Emphasis in Original] These weren’t posts from some random supporter on the group’s Facebook page, they were posts from the official account of the organization.
Similarly, the Louisville Tea Party was granted 501(c)(4) status in 2009. Nevertheless, it published a list of “officially tea party endorsed candidates for the 2011 Kentucky primary.” They also published an article “The Rationale for Romney-Ryan,” arguing for Tea Partiers to vote for the Republican candidate.
Then there’s the Katy Tea Party Patriots, which filed for 501(c)(4) non-profit status in 2009. This group actually ran an “Oust Obama 2012” campaign, organizing block-watching with the Fort Bend GOP, and phone-banking against Obama at GOP headquarters in Sugarland and Houston, Texas. Still featured on the frontpage of the group’s website at the time this article was written is an October 4, 2012 article entitled, “Our Country’s Future” by Katy Tea Party Patriots President, Darcy Kahrhoff. She urged members to vote for Gov. Romney. “Please take time to talk with friends and family you may have living out of state, and try to convince them to vote for Governor Romney, especially if you have friends and family in Florida, Colorado, or Ohio. Also, find a Senatorial candidate to support in these states, and go to FreedomWorks to phone bank for these patriots. Everything you can do to help will matter. We can, and we must, win this!“
Not to be outdone, is the Central Valley Tea Party Inc. This regional California Tea Party group was granted the much more politically limiting IRS 501(c)(3) tax status back in 2009. It should be noted that this tax-status explicitly prohibits partisan political activity. According the IRS, “Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. The prohibition applies to all campaigns including campaigns at the federal, state and local level. Violation of this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise taxes.”
Despite this (c)(3) designation, the group appears to have been involved in partisan political activity. Currently, the frontpage of the group’s website features “upcoming events” instructing members to “Volunteer for Measure G,” and “Volunteer for Vidak for Senate.” In the latter case, the website simply tells members, “Please volunteer to do phone banking or precinct walking to help win the election.”
Further stretching IRS regulations, the group’s newsletter endorsed and advertised conservative candidates. In an article in the October 2012 issue of the Central Valley Tea Party Times entitled, “Why You Should Be Excited to Vote for Mitt Romney,” Paul Szopa told fellow Central Valley Tea Partiers to get out and campaign for GOP presidential candidate Mitt Romney, “So it’s time to get excited to vote for the better candidate. It’s time to talk him up to friends and family. It’s time to join with groups like Operation Swing State (www.operationswingstate.org) and make calls in support of his candidacy.” The group’s “Voter Guide” published on the front page of the newsletter is even less ambiguous, listing all the candidates that the group recommended as well as their positions on all of the ballot measures.
Issues of the publication even featured advertisements for conservative campaigns. The April-June 2012 edition of the Central Valley Tea Party Times features an advertisement for Whelan for Congress on page 27, another for Frank Bigelow for the 5th District California Assembly seat on page 38, and an ad “Elect Richard J. (Rick) Farinelli, Madera County Supervisor District III” on page 39. And the August-September 2010 edition of the Central Valley Tea Party Times features an ad for Diane Lenning a write-in candidate for CA state superintendent of Public Instruction. So does the October-November 2010 edition.
Another Tea Party group granted the 501(c)(3) non-profit status by the IRS, is the Tifton, Georgia-based Tiftarea Tea Party Patriots, Inc., which received the designation in 2010. The group also appears to have engaged in openly political activity, including publicly endorsing candidates. On October 9, 2012, in a post on the group’s website “Are you ready to vote?” the group offered up an endorsement for Romney, “The choice is simple. Obama has stated, He will transform America and acted to do such. Everything this Administration stands for, is Government and control of every aspect of life. This is the pipe dream of a Socialist’s mentality, for in their eyes, you the individual, do not know and cannot do, what is right, so someone else has to make decisions for you, to ensure, you do not make the wrong choices or actions. Or you chose Romney, who does not want to transform America, the greatest nation in history of human kind. He wants to allow, the individual, to have the right, to succeed and fail on his own regard, while ensuring those freedoms, given by our Creator and to assure those inalienable rights, written about in the Declaration of Independence are retained by their proper owners, ‘We the People.’”
These are but a few of the many examples of political intervention by Tea Party non-profits that IREHR has catalogued. There are many, many more. They’re not difficult to find. Rather than the so-called scandal cooked up by Tea Party groups, the real criticism of the IRS may be that it has let so many of these groups get away with what are apparently egregious violations.
After the firing of several high level IRS employees over this incident, how likely is it that Tea Party groups will be prevented these sorts of violations in the future?
For a printed version of this Special Report, complete with exhibits, please email us.