Tax Advocates Should Pay Taxes

May 16, 2013

Maybe the IRS should be investigating tax-exempt organizations.

Instead of targeting conservative organizations, though, the IRS should consider targeting liberal organizations.  You know – the ones that pay no taxes, but want to raise everyone else’s taxes.

When organizations are tax-exempt and are not paying to support the government, those of us who pay taxes are indirectly supporting them with our tax dollars.  Why should my tax dollars benefit organizations that want to raise my taxes?

Consider the Massachusetts Budget and Policy Center, which is organized as a nonprofit 501(c)(3) organization.  The center was created by a group of non-profits to advocate for higher taxes and more government spending.  Its mission has not changed, but at least its name has.  It was formerly called the Tax Equity Alliance of Massachusetts (TEAM).

Maybe someone finally figured out that true “tax equity” would require TEAM and the organizations it represents to pay taxes.

Then there’s the American Association of Retired Persons (AARP).  Given the group’s big-government bias and opposition to entitlement reform, perhaps its name should be changed to American Association Against Retired Persons.  While allegedly “nonpartisan,” the organization supported ObamaCare and opposed Social Security reform.

AARP is a “non-profit” in name only.  It sells insurance, but, unlike other insurance companies, it is tax exempt.  In 2011, when a few Republicans in Congress questioned whether AARP should be allowed to maintain its non-profit status, AARP had revenues of $657 million from its insurance sales.  Of course, since AARP has what may be the most powerful lobby in the country, its tax-exempt status is safe.

The Billionaire’s Non-Profits

Also consider the dozens of non-profits funded or organized by billionaire George Soros and his Open Society Foundations.  While there are some organizations on the list that may merit their non-profit classification, many are far-left, anti-Semitic, anti-American, anti-military or anti-business.  Many either directly support higher taxes or support political candidates who favor higher taxes.

Perhaps the organization Mr. Soros is most well-known for supporting is MoveOn.org.  The non-profit MoveOn.org Civic Action claims to focus on “nonpartisan education and advocacy on important national issues,” but MoveOn is about as nonpartisan as Barack Obama.

Civic Action shares the MoveOn.org Web site with the political action committee MoveOn.org Political Action, where they share the tag line, “Over 8 Million Progressives Taking Action.”

Tax-exempt organized are organized as either 501(c)(3) organizations or 501(c)(4) organizations.  Both are tax-exempt, but only donations to 501(c)(3) organizations are tax deductible.

As a 501(c)(3) organization, the Massachusetts Budget and Policy Center is supposed to be operated solely for one or more of the following purposes: “charitable, religious, educational, scientific, literary, testing for public safety, fostering national or international amateur sports competition, and preventing cruelty to children or animals.”  How does advocating for more government spending and higher taxes qualify the group for tax exemption.  If the group believes in higher taxes, why does it pay no taxes?

As a 501(c)(4) organization, MoveOn.org Civic Action is supposed to be “operated exclusively to promote social welfare” and that means welfare in the true sense of the word, not government assistance.  Such organizations “must operate primarily to further the common good and general welfare of the people of the community (such as by bringing about civic betterment and social improvements).”  In reality, MoveOn.org is a political group dedicated to electing the most radical Democrats possible.

This is still a democracy and a diversity of opinion should be encouraged and respected.  But I’m sick of supporting groups that oppose free market capitalism with my tax dollars.

Let the tax advocates start paying taxes.

 

Comments

Soros

Hi Dave,
I'd like to correct a misstatement in your post about Soros and a misimpression about the Open Society Foundation. What you say about his funding antisemitic organizations is untrue and is a vicious lie that the right has promoted against him many times over the years. Soros was a born a Jew and his family fled Hungary during WWII. There are many who criticize him unfairly saying he's anti-semitic, when it fact the opposite is true. Here's a story that explains the truth about his background:
http://www.huffingtonpost.com/cenk-uygur/glenn-becks-horrific-lie_b_7826...
Also, the Open Society Foundation is another favorite punching bag of the right that in fact does a tremendous amount of good work in Europe, Asia, Africa, the US, and elsewhere. The people who work there are tireless in their efforts for social justice and human rights in some of the most dangerous places in the world. Just check out the home page for a short list of some of the great work OSF does:
http://www.opensocietyfoundations.org/

One last point I'd make on this post involves tax exemption for 501c4 organizations. The definition of a 501c4 hingest on whether they are doing work that is 'exclusively' for social welfare or 'primarily' for social welfare. Currently the IRS determines whether organizations applying for this status are 'primarily' working for social welfare. That's a difficult question for anyone to answer when many organizations are trying to obtain 501c4 status for political gain.

Here's an article that explains that the problem is as you suggest: While targeting tea party groups, the IRS also should have scrutinized applications from liberal or left-leaning groups.
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/05/29/the-irs-scand...

One of the best accounts of the scandal comes from Bill Moyers, who quotes legal scholar Jeffrey Toobin. Here's an excerpt from the Moyers article:
As Jeffrey Toobin points out at NewYorker.com, thanks to Citizens United, there are no limits on the amount of money you can accept from corporations and private donors, and no limits on what you can spend. You don’t have to pay taxes or disclose donors. The catch is that electioneering cannot be your primary activity. But as Toobin observes, “leading up to the 2012 elections, many conservative organizations, nominally 501(c)(4)s, were all but explicitly political in their work.”

Here's the link:
http://billmoyers.com/2013/05/15/the-taxman-and-the-tea-partiers/

Karl Rove's Crossroads GPS has 501c4 status, and in my opinion, its work is not done 'primarily' for social welfare. Here's a link:
http://www.opensecrets.org/outsidespending/detail.php?cmte=C30001655
Joe Burns
Falmouth, Mass.

Soros

Joe:

 

Thanks for your detailed comment.  This is clearly an issue where both sides can come up with arguments that appear valid.

 

George Soros is admired by many for his philanthropy.  I am personally not one of his admirers.

 

The fact remains that there are many organizations that pay no taxes, yet advocate for higher taxes for the rest of us.  That's hyprocrisy, not philanthropy.

Dave

More on Soros

Hi Dave,
Just saw this article about one of your favorite people. Didn't know this about him:
Soros charitable foundation sometimes leans right
Groups touting conservative ideals among recent beneficiaries
http://www.publicintegrity.org/2013/06/17/12814/soros-charitable-foundat...

And, some day, I'll show you the picture I have of my daughter shaking hands with Soros.

Oh boy. Go Bruins!
Joe

More on Soros

I may have to change my opinion ... if he writes me into his will.

Thanks for your comments, Joe.

Too bad about the Bruins.

Dave

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