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CREW and Former Cong. Candidate Dr. David Gill Sue IRS Over Tax Loophole for Dark Money Groups


Business  (tags: congress, corruption, candidates, dishonesty, elections, ethics, freedoms, lies, media, propaganda, republicans, u.s., politics, government, cover-up, abuse, americans, business, consumers, corporate, corruption, cover-up, dishonesty, finance, investments )

JL
- 504 days ago - citizensforethics.org
Although the law says 501(c)(4) groups must operate "exclusively" for social welfare purposes, an IRS regulation says the groups may operate "primarily" for such purposes.



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JL A. (274)
Friday February 22, 2013, 8:46 am
Feb 19, 2013
CREW and Former Cong. Candidate Dr. David Gill Sue IRS Over Tax Loophole for Dark Money Groups
Lawsuits, 501c Groups, Elections, Federal Agencies, Department of the Treasury, Internal Revenue Service, Legal, Amicus Briefs, Organizations, American Action Network, Press Releases, Senate Members, Norm Coleman

Internal Revenue ServiceWashington, D.C. — Today, Citizens for Responsibility and Ethics in Washington (CREW) and former congressional candidate Dr. David Gill filed a lawsuit against the Internal Revenue Service (IRS) in the United States District Court for the District of Columbia for flouting a federal law barring 501(c)(4) organizations from engaging in political activity. Groups such as the American Action Network (AAN) have relied on an IRS-created tax loophole to spend hundreds of millions of dollars on electioneering activity without disclosing their donors.

Read CREW's complaint against the IRS
Fact Sheet on CREW's lawsuit against the IRS

CREW Executive Director Melanie Sloan stated, “Disgracefully, the IRS has sat on its hands for the last two election cycles while
501(c)(4) groups have been formed expressly to run negative attack ads funded by anonymous donors. When called out, the IRS has said only that it is ‘aware’ of the public’s concern. Now the IRS can explain its deplorable inaction in federal court.”

In 2012, David Gill, an emergency room physician, ran for Congress in Illinois’13th district. AAN, headed by former Sen. Norm Coleman (R-MN), funded false and misleading negative ads and robocalls against Dr. Gill, forcing his campaign to spend significant time and money attempting to counter them. AAN reported spending nearly $1.5 million opposing Dr. Gill — more than $1 million of which funded negative ads in the final weeks of the campaign.

AAN received substantial financial contributions from both insurance giant Aetna and the Pharmaceutical Research and Manufacturers of America, both of which oppose the single-payer, national health care plan supported by Dr. Gill. The ads AAN ran against Dr. Gill falsely claimed he was a “mad scientist” who wanted to destroy Medicare and raise taxes. Reputable polls indicated Dr. Gill led throughout the campaign, but in the wake of the AAN ads, Dr. Gill lost by 0.3 percent of the votes, making it the third-closest House race in the country.

“Campaigns should be transparent,” said Dr. Gill. “Voters should know who is funding political advertisements, so that they have the information necessary to properly evaluate the claims contained therein. By its inaction, the IRS has allowed shadowy groups to influence elections under a cloak of darkness.” Gill went on to note, “I ran for office because I believe in the democratic process and public service. I am taking this action against the IRS in furtherance of those beliefs — to ensure that anonymous dark money groups cannot continue to taint the political process by operating under the guise of social welfare organizations.”

Federal law states 501(c)(4)s must operate “exclusively for purposes beneficial to the community as a whole.” In contrast, IRS regulations allow a group “primarily” engaged in activities that promote the public welfare to take advantage of 501(c)(4) status. Many 501(c)(4) groups have interpreted this to mean they can spend up to 49 percent of their funds on political activities. The lawsuit, however, alleges the IRS regulation is invalid because “exclusively” and “primarily” are not synonymous and 501(c)(4) groups should be barred from engaging in political activities.

In its 2010 application to the IRS, AAN stated it expected to spend less than 20 percent of its resources on political activities. Within days of receiving IRS approval of its 501(c)(4) status, AAN acknowledged it planned far greater political activity than it had represented. Previously, CREW has filed two complaints with the IRS and one with the Federal Election Commission, alleging AAN violated tax and campaign finance laws.

Read CREW's complaint against the IRS

Fact Sheet on CREW's lawsuit against the IRS
 

Tim C. (1732)
Friday February 22, 2013, 8:54 am
thanks
 

JL A. (274)
Friday February 22, 2013, 11:48 am
You are welcome Tim
 

Roger Garin-michaud (61)
Friday February 22, 2013, 2:29 pm
noted, thanks !
 

JL A. (274)
Friday February 22, 2013, 3:56 pm
You are welcome Roger!
 

John B. (215)
Saturday February 23, 2013, 5:47 am
Thanks J.L. for the excellent post. Kudos to CREW and Dr. Gill for their action. The IRS should follow the Law not interpret it. Read and noted.
 

Patrick Donovan (312)
Saturday February 23, 2013, 8:28 am
Well done J.L., excellent eye for significant civil rights issues and actions. Thank you.
 

JL A. (274)
Saturday February 23, 2013, 8:42 am
You are welcome John and Patrick. I agree John and appreciate your kind words Patrick.
You cannot currently send a star to John because you have done so within the last week.
You cannot currently send a star to Patrick because you have done so within the last week.
 

Michael Kirkby (83)
Saturday February 23, 2013, 9:52 am
It should always be about the issues. Campaign finance reform should be at the head of Barky's mandate this time.
 

JL A. (274)
Saturday February 23, 2013, 11:41 am
You cannot currently send a star to Michael because you have done so within the last week.
 

Lois Jordan (55)
Saturday February 23, 2013, 1:43 pm
Noted w/thanks for posting, J.L.
I just read an article in Common Dreams that Rep. Rick Nolan (MN) and Rep. Mark Pocan (WI) have introduced H.J. Res. 29, a.k.a. "We the People Amendment."
Sect. 1 states: "Only people have constitutional rights."
Sect. 2 states: "Money Is Not Free Speech"

MovetoAmend.org has a petition and are getting even more active locally. Check out this great group.
 

Dianna M. (13)
Saturday February 23, 2013, 1:45 pm
. . . how about Crossroads GPS? Can we sue them, too? Or just the IRS, because of them?
 

Dianna M. (13)
Saturday February 23, 2013, 1:47 pm
Because I seriously think CREW should be able to sue the dark money groups themselves, too, on behalf of all of us.
 

Mary Donnelly (46)
Saturday February 23, 2013, 1:54 pm
Thanks again J.L. A. Your posts are always good.
 

Joanne Dixon (35)
Saturday February 23, 2013, 2:04 pm
CREW and Dr Gill certainly deserve to win this, but unfortunately that doesn't mean they will. CREW is accepting donations; TomCat's blog has a link (http://www.care2.com/news/member/527046926/3535857) for those who can. I realize not all of us can; I can't myself; but surely some can.
 

JL A. (274)
Saturday February 23, 2013, 2:21 pm
You are welcome Lois and Mary.
You cannot currently send a star to Lois because you have done so within the last week.
You cannot currently send a star to Joanne because you have done so within the last week.
 

Birgit W. (140)
Saturday February 23, 2013, 2:46 pm
Thanks
 

Dianna M. (13)
Saturday February 23, 2013, 2:49 pm
Well, crap. CREW doesn't take Discover, which I like to use because of the secure online account numbers. Guess I'll have to send a check:

Citizens for Responsibility and Ethics in Washington
1400 Eye Street NW Suite 450
Washington, DC 20005
 

JL A. (274)
Saturday February 23, 2013, 2:56 pm
You are welcome Birgit. Thanks ever so much for posting the way to send a check to support this effort Dianna!
You cannot currently send a star to Dianna because you have done so within the last week.
 

Robert K. (31)
Sunday February 24, 2013, 4:36 am
Multi billion dollar fines and 25 year sentences for every principal involved would seem a good start in every case that included a lie.
 

Donna W. (0)
Sunday February 24, 2013, 11:27 am
Good for him, and I hope he wins the suit.
 

Shirley B. (5)
Sunday February 24, 2013, 3:31 pm
I hope they win. TY,J.L
 
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