The Billings Montana Shrugged TEA Party is preparing for another angry anti-government rally today. They are calling it a protest against the IRS, but they should be calling it a celebration of their success in stopping existing U.S. laws from being enforced.
What the TEA Party doesn’t understand (and its big money donors are hoping no one does) is that the law IRS to investigate political dark money groups–even if congress and several administrations have failed to enforce them.
As Floyd Norris explains in the NYTimes business section: there are two reasons that the IRS is involved in political contribution rules.
The first reason is that while 501c3 charities (such as the March of Dimes) are exempt from gift tax laws, there isn’t an exemption in the law for c4s–like American Tradition Partnership. That means that if the laws were actually enforced, donors who gave more that $13,000 to a c4 like ATP should be paying taxes on that donation.
This would certainly constrict the massive flow of cash into these organizations –conservative and liberal both, though of course there is much more conservative money. As ABC news reports, there has been a big uptick in 501 c4 applications from right-wing groups like American Traditions Partnership recently.
There is a second reason the IRS has a role here. While your donations to the March of Dimes (a C3) are tax deductible, donations to c4s like ATP and ALEC are not. However, corporations may be deducting their support for groups like ALEC anyway, calling their donations “necessary business expenses.” No one knows whether corporations are doing this or not–and we never will since the TEA Party has bullied the U.S. government to the point that its afraid to do its job and even investigate the matter.
That’s why the GOP is so up in arms about the latest IRS attempts to find out what’s going on. They’ve learned that any time the IRS makes a move to actually enforce current law, the TEA Party, the GOP, and Fox News can simply freaks out and the IRS and the administration backs down. Here’s how Norris explains it:
As the political furor grew this week, President Obama forced out the acting commissioner of the I.R.S. Does anyone think his successor, or his successor’s successor, will have any appetite for trying to enforce the tax law’s restrictions on political activities by so-called social welfare groups? After all, any political group can contend that an audit reflects partisan politics.
It would be much better if someone other than the tax collection agency had to decide whether to start investigations, but that is not what the law now says.