Thursday, August 22, 2013

Last Call For 501(c)(4) Mystery Meat

House Democrat Chris Van Hollen of Maryland comes through with a novel approach to suing the IRS:  doing so to get them to adhere to federal law and stop allowing dark money PACs to play the anonymous donor game.

Rep. Chris Van Hollen (D-Md.), the ranking member of the House Budget Committee whose office announced the action, will serve as lead plaintiff in the case, joining campaign-finance watchdogs Democracy 21, the Campaign Legal Center and Public Citizen.

The lawsuit will address one of the main concerns that surfaced with the recent IRS targeting controversy: Differences between federal law and the IRS rules on eligibility for 501(c)(4) candidates.

Current law says the organizations must engage “exclusively” in so-called “social welfare” activities, while IRS regulations require that their “primary” purpose fall into that category.

The distinction means that 501(c)(4) groups could no longer be tax-exempt at all, and would be subject to reporting requirements for donors.  That's going to be a real damper on GOP groups, which overwhelmingly use these groups compared to Democrats in fundraising hundreds of millions of dollars.

It ought to be interesting where this goes.  I hope it's the end of these dark money PACs for good.

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