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Some Groups Targeted By IRS Were Legitimately Flagged

Jeremy Fuster |
May 27, 2013 | 4:40 p.m. PDT

Executive Producer

(Cliff1066/Creative Commons)
(Cliff1066/Creative Commons)
The New York Times reported Monday that some of the groups accusing the IRS of targeting their tax exemption applications for extra questioning were involved in political activities while applying as "social welfare" organizations, and that some of the IRS' strange questions were designed to determine whether those organizations' primary purpose was truly for social welfare or for politics.


Some of the organizations mentioned in the article include the Wetumpka Tea Party, an Alabama organization that "sponsored training for a get-out-the-vote initiative dedicated to the 'defeat of President Barack Obama,' and a California conservative veterans' group called CVFC, which spent nearly $8,000 in 2010 on radio ads supporting a San Diego Republican's Congressional campaign. The spending was not detailed in the group's tax return. CVFC also said on the return that they had not "engaged in direct or indirect political activities on behalf of a candidate for political office."


Two weeks ago, IRS official Lois Lerner admitted that nearly 300 groups applying for tax exemption between 2010 and 2012 had been flagged for additional screening. A report from the U.S. Treasury Department's inspector general, J. Russell George, also declared that the IRS had used inappropriate criteria to flag some of those organizations, including asking the groups for information about their donors and whether their leaders had plans to run for public office. 


SEE ALSO | Obama Calls For IRS Reform


However, some former IRS officials told the New York Times that they disagreed with many aspects of George's report, saying that some of those seemingly inappropriate questions were relevant to determining whether the organizations merited tax-exempt status.


“The I.G. was as careless with terminology as the Cincinnati office was,” said Marcus S. Owens, who headed the I.R.S.’s exempt organizations division until 2000. “Half of those questions have been found to be germane in court decisions.”

I.R.S. agents are obligated to determine whether a 501(c)(4) group is primarily promoting “social welfare.” While such groups are permitted some election involvement, it cannot be an organization’s primary activity. That judgment does not hinge strictly on the proportion of funds a group spends on campaign ads, but on an amorphous mix of facts and circumstances.

House lawmakers plan to use the Memorial Day recess to continue to investigate documents requested from the IRS. They will also call upon more IRS and Treasury officials to answer questions about how the tax-exemption applications were handled and why concerns weren't raised sooner.

Read the full story at The New York Times HERE.

Reach Executive Producer Jeremy Fuster here or follow him on Twitter.



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