The Campaign Legal Center: IRS Proceedings

IRS: 501(c)3 Tax Status and Campaign Activity

Legal Center Sends Letter to IRS: Plans by 501(c)(3)s to Interview Political Candidates May Violate Tax Status.

In a letter to IRS Commissioner Mark Everson, Prof. Frances R. Hill, Tax Program director of the Campaign Legal Center, writes that plans by several tax-exempt organizations to conduct joint interviews of Republican presidential candidates could violate the section 501(c)(3) ban on partisan campaign activity by charities.

Click here to read the Legal Center's letter to the IRS.

Click here to read the Roll Call article.

Legal Center Files Complaints Against Falwell Ministries Inc. and Liberty Alliance, Inc.

The Campaign Legal Center sent a letter to the Commissioner of the IRS and filed a complaint with the Federal Election Commission on July 26, alleging Jerry Falwell Ministries and related-entity Liberty Alliance, both corporations, violated campaign finance laws by endorsing President George W. Bush and announcing their endorsement to the general public through their website and via email, and soliciting funds for a political action committee on their website, also accessible to the general public. The Legal Center asked the IRS to look into the Jerry Falwell Ministries and related-entity Liberty Alliance activities, which clearly violate the exemption requirements under the tax code section 501(c)(3).

Under campaign finance law, organizations - like Jerry Falwell's group - that claim tax exemption under section 501(c)(3) may not endorse candidates for public office in this way. On his website, Falwell encouraged "everyone reading this column today to take a moment to send a financial gift to the Campaign for Working Families in order to help in the crucial election of President Bush and conservative political leaders across the nation."

Additionally, the CLC sent a letter to the IRS asking the agency to enjoin Falwell's endorsement of Bush and issue guidance to other religious organizations reminding them that no organizations claiming exemption under section 501(c)(3), including churches, may endorse candidates for public office.

Click here to read the letter to the IRS.

Click here to view the FEC Falwell complaint and exhibits.

Click here to read the Center's full press release on the complaint.

IRS Tax Exempt Commissioner Reminds Political Parties not to Jeopardize the Tax-exempt Status of Various Charitable Organizations

"[Commissioner] Miller outlined the information about the federal income tax law requirements to help the parties ensure that, during this election season, from inadvertently or otherwise jeopardizing the status of any charitable organization. While noting pending legislation, he explained that, under current federal law, tax-exempt charitable organizations are prohibited from endorsing candidates, making donations to their campaigns, engaging in fund-raising, distributing statements, or becoming involved in any other activities that would be either beneficial or detrimental to any candidate. Organizations engaged in prohibited section 501(c)(3) campaign activity, Miller warned, could lose their exempt status and be subject to excise taxes."

Click here to view the letter.

The IRS Issued a Reminder to 501(c) Tax-exempt Organizations to be Cautious in their Efforts to Educate Voters in a Presidential Election Year

"Issued in connection with a letter to seven national political parties, the Service cautioned the parties against jeopardizing the tax-exempt status of various organizations, including churches, charities, and educational institutions. (For a summary of Treasury's letter to the parties, see Doc 2004-12267.) If a section 501(c)(3) organization is found to have participated or intervened, for or against, in a political campaign, the Service said, it could lose its tax-exempt status and be subject to excise taxes."

Click here to view the release.