WASHINGTON (CBS DC) – Congressional Republicans have been making political hay over revelations that the IRS has been taking a close look at political groups that apply for tax-free status.
Now they see another threat in the form of a new IRS proposal to the requirements for “social organizations” to qualify for a tax exemption.
House Ways and Means Committee Chairman Dave Camp, R-Mich. held a hearing to investigate the matter.
He said the new regulations were “drafted in a manner, in my view, to shut down tea party groups.”
Rep. Charles Boustany, R-La., chairman of the Ways and Means’ oversight subpanel, warned that the new rules would “essentially codify the continued targeting of these very same groups.”
Rep. Joe Crowley, D-N.Y., slammed Republicans for demanding more information from the IRS.
He noted that there have been 14 hearings on the issue and conducting 60 interviews with IRS personnel.
He called it an “attempt to find a smoking gun that would link what has taken place… to the president.”
“They have a gun — it’s a smoking gun, but it’s a cap gun,” Crowley said. “You get a great sound and an awful lot of smoke.”
Rep. Sandy Levin, D-Mich., the top Democrat on the Ways and Means Committee, said there was no evidence of political corruption.
Levin told his Republican colleagues, “It’s clear you’re trying to keep this issue alive for political purposes.”
IRS Commissioner John Koskinen defended his agency at the hearing.
“Taxpayers need to be confident that they will be treated fairly, no matter what their background or their affiliations,” he said. “Public trust is the IRS’ most valuable asset.”
Under the 501(c)4 classification, “social welfare” organizations are allowed to spend unlimited sums of money on politics as long as politics isn’t their main focus.
These tax-exempt organizations are not required to disclose their donors.
After the Citizens United Supreme Court case in 2010 cleared the way for corporations to spend unlimited amounts of money in politics, the number of applications for 501(c)4 status more than doubled.
The new rules would limit the “candidate-related political activity” that these groups can conduct.
Limited activity would include anything that advocates for a specific candidate and any money spent on clearly political purposes.
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