A top House Democrat filed a lawsuit on Wednesday to end 501(c)(4) tax treatment of groups that ostensibly engage in political activity, but said that Organizing for Action (OFA), the (c)(4) that evolved out of the president’s campaign apparatus, is not one of those groups.
“My understanding is that [OFA], as currently constituted, is not engaged in spending money to directly defeat or elect candidates,” said Rep. Chris Van Hollen (D., Md.) in a conference call announcing the lawsuit.
“They are not therefore engaged in that kind of direct electoral campaign activity,” Van Hollen added.
The congressman is suing the Internal Revenue Service (IRS) over its treatment of (c)(4) groups, which he said are legally required to “exclusively” conduct activity classified as “social welfare.”
The IRS currently requires that groups be engaged primarily in social welfare activities, which has come to mean that a majority of their activities fall into that category.
In practice, that means that (c)(4) groups must devote at least 51 percent of their resources to activities that the IRS deems in the service of “social welfare.” Van Hollen’s suit aims to establish a 100 percent social welfare requirement.
“When you’re spending money to directly elect or defeat candidates, that clearly is political activity that is in violation of the plain meaning of the statute,” Van Hollen insisted.
Via: WFB
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