The latest Republican Obama scandal is starting to fall apart too. The IRS didn’t just target conservative groups. They also questioned the tax exempt status of liberal groups too.
In 2012, The Chicago Tribune reported on the IRS denying tax exempt status to a liberal political group,
The IRS announced in May and June that it took the actions against two groups defined as tax-exempt under the 501(c)(4) section of the tax code. The IRS on Thursday declined comment on its tax-exempt final rulings. Tax-exempt groups raising money for both major political parties ahead of the Nov. 6 election walk a fine line between promoting “social welfare” for tax-exempt purposes and purely political interests.
A 501(c)(4) group denied tax-exempt status by the IRS would run afoul of Federal Election Commission rules and could be
required to disclose its donors. Emerge America, a group which helps Democratic women seeking elected office, said it lost it tax-exempt status last October. The IRS invoked the “private benefit doctrine” barring 501(c)(4) status for any group promoting a candidate or political party. The IRS announced its final decision in May.
In June the IRS said it denied 501(c)(4) tax-exemption for an unnamed political group also under the private benefit doctrine. The IRS is barred by law from disclosing the group’s name and the group has not publicly identified itself. The group had one objective: to serve the political goals of its founder, the IRS said. A 501(c)(4) group can spend some funds on political advocacy, but electioneering cannot be its sole reason for existence or comprise a majority of its spending.
It looks like the IRS was not just targeting conservative groups, but was targeting political action groups who may have been violating the tax exemption guidelines. If the IRS wasn’t targeting conservatives, but trying to deal with the surge of dark money groups applying for tax exempt status, this story takes on an entirely different context.
Reuters has obtained part of a yet to be released report from the Treasury Inspector General for Tax Administration (TIGTA) that confirms that the IRS was targeting groups on the left and right who focused their activities on advocating for expanding or limiting of the size of the government. The report also states that the screening process was not influenced by the Obama administration, and that none of the groups screened were denied tax exempt status.
Without the claims of a partisan witch hunt against conservative groups, this latest Republican fueled Obama scandal is set to lose all of its sizzle.
The real reason why Republicans are desperately trying to drum up a scandal here is because they don’t want the IRS forcing their dark money groups to pay taxes. The IRS is threatening their Citizens United fueled political slush fund, and Republicans want it to stop. Republicans are trying to bully the IRS into backing off.
It turns out that Obama isn’t Richard Nixon after all. He wasn’t using the IRS to attack his enemies. In their own bungling way, the IRS was trying to deal with the problems caused by the Supreme Court’s Citizens United decision. First, Benghazi crashes and burns, and now the IRS scandal could be fading fast.
Republicans will pull from their usual “Obama scandal” playbook and hold lots of hearings, but thing looks to be on the fast track to nowhere. Congressional Republicans will try their best, but the IRS “scandal” could backfire and end up making the case for why we need to get rid of Citizens United ASAP.