[Editor’s note: Check out Part 1 of this series on OCR.]
The Current Attacks on Section 501(c)(4) Organizations
As noted in the previous section of this article, the simple truth is that it has always been understood that Section 501(c)(4) organizations have a political “agenda,” because they are designed to be advocacy organizations for specific social changes, and that is their quintessential function. Thus, if considered objectively, the current complaints about Section 501(c)(4) organizations make little or no legal or practical sense. Unfortunately, the current controversy is not merely a legitimate difference of opinion regarding the proper use of a Section 501(c)(4) organization, it is a coordinated effort designed to silence Section 501(c)(4) organizations whose view of what constitutes the “public good” varies from the that of the attackers, including the political leadership of the IRS.
In light of the foregoing discussion of the legal framework of Section 501(c)(4) organizations we can clearly see how unusual and dangerous is the sustained attack on these groups, essentially limited to Center-Right organizations. Whether it is the never ceasing complaints from the “Progressive” groups that don’t share the same world view of conservative organizations, or the more frightening attacks by the IRS that has appointed itself the arbiter of what constitutes the “public good,” there is no legal basis for these actions.
Social welfare groups are designed to promote their view of the social welfare of our society and to participate in the public debate of the proper direction our society should follow.
Silencing one political viewpoint due to the demands of their political opponents is anathema to the basic principles and beliefs of a free, democratic society. Moreover, any such effort is completely contrary to the guarantees of the freedom of speech and the right to petition government.
Thus, you would expect that none of these attacks would be given serious consideration because they are overtly frivolous, given our history and heritage as a nation, as well as our constitutionally guaranteed freedoms. However, you can never underestimate the cleverness of the “Progressives” and the sleight of hand trick they have used to prosecute their attacks on our freedoms.
The IRS Attacks the “Tea Party”
Last Spring, the news erupted that the IRS had been giving extraordinary scrutiny to conservative groups that had applied for tax-exempt status under Section 501(c)(4). Historically, the process for securing tax-exempt status under this provision typically has been a laborious and relatively slow process that requires a careful and complete application for tax-exempt status. However, the level of review instituted by the IRS last year was far more intense and was plainly a focused campaign.
Among other things, it became clear that this extra scrutiny was triggered by groups that had “suspicious” words or phrases in their corporate names, such as: “liberty”; “we the people”; “constitution”; “tea party”; or, other words that might be associated with a Center-Right viewpoint. This “be on the lookout” approach adopted by the IRS, to identify and persecute Center-Right groups based upon their names, is unprecedented in the entire history of the IRS. No other Administration has blatantly sought to muzzle hundreds of opposing citizen groups by enmeshing them in bureaucratic snares and, thereby, denying them tax-exempt status.
Once ensnared in this bureaucratic web, the groups were subjected to round after round of invasive questions and accusations. For example, some groups were required to, inter alia, list and provide to the IRS examiners copies of every book or article that any of their members had ever read or discussed at a group meeting. Even discussions of the U.S.Constitution were considered to be suspicious conduct.
Individuals were targeted in multiple IRS examinations, on what appeared to be a whimsical basis. Moreover, other individuals who appeared to have leadership roles quickly found themselves the targets attacks on their personal and business tax filings, as well as audits and inspections by unrelated government agencies.
Despite Congressional hearings on these outrageous tactics, the IRS has successfully hidden the true agenda behind these actions, and stonewalled the Congressional investigation. However, even to a casual observer, it is very clear why the IRS targeted Center-Right groups – it was to deny them tax-exempt status and, by imposing extraordinary compliance burdens, chill their interest in participating in the public debate of political issues.
[Related on OCR: “Are We in a Constitutional Crisis?”]
The Obama Administration has offered relatively feeble justifications for these actions, but there has really been no satisfactory explanation forthcoming from the Administration. Nevertheless, the reason this initiative began is quite clear – the Obama Administration sought to minimize the number and power of Section 501(c)(4) groups that did not agree with its agenda. Certainly, the attacks could not be based upon the fact these groups were involved in political issues. That is precisely why Section 501(c)(4) is in the Internal Revenue Code.
Accordingly, the only possible explanation for these concerted attacks on Center-Right groups was that the attacks were expressly designed to gag political opponents, and, to the extent possible, completely prevent them from participating in the political process. Since this type of content-based censorship is abhorrent to our democratic system of government, it is not surprising that the Obama Administration has preferred to ignore the issues, and hopes they are forgotten.
William M. Todd, Esq. is a prominent Republican lawyer engaged in private practice in Columbus. For over 30 years, he has been deeply involved in conservative causes including tax reform, tort reform, school choice, election reform, and pro-life related matters. His principal substantive expertise is in the field of health law and health system reform
All opinions expressed belong solely to their authors and may not be construed as the opinions of other writers or of OCR staff.
RELATED on OCR: Read all articles by Bill Todd here.