July 5, 2015; New York Times
In Sunday’s New York Times, Eric Lightblau suggests that the IRS should not be expected to contain political spending through nonprofits during the 2016 election, and especially not conservative spending. Not only is the IRS underfunded, he writes, but they will also be unwilling to step into the climate of deep suspicion that persists two years after charges that the agency targeted conservative groups applying for tax-exempt status.
Lightblau reports that at least eight Republican presidential candidates, including Jeb Bush and Sen. Marco Rubio of Florida, have relationships with nonprofit groups set up to raise hundreds of millions of dollars. Hillary Clinton’s supporters are reported to be considering the same course. Such groups, of course, are not obliged to disclose their donors.
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“It’s ‘anything goes’ for the next couple of years,” said Paul Streckfus, a former nonprofit specialist at the IRS, talking about the 501(c)(4)s. “The whole system has really collapsed.”
Audits for electoral campaigns are extremely rare, and complaints languish in the best of times, but an overstretched IRS in a touchy, suspicious political environment is unlikely to move quickly, and electoral candidates may see that as a major opportunity to increase the role of 501(c)(4)s in the coming election.
While there are clear distinctions for much of the sector between (c)(3)s and (c)(4)s and between advocacy and electioneering, the general public, when faced with reports of massive political spending through (c)(4)s, will only hear “nonprofit.” This will encourage the public to think of nonprofits as a sector full of unaccountable activity. Beyond the damage done to the democratic process, this situation will do damage to nonprofits, particularly those engaged in legitimate advocacy activities.—Ruth McCambridge