Tuesday, May 28, 2013


Today the San Francisco Chronicle has an AP story (also here) about efforts by gunners to recall the president of the Colorado Senate, John Morse, because he supported gun control and, naturally, must be destroyed. We're told:
The recall group's main funding comes from a $14,000 contribution from a nonprofit run by a local conservative consultant, Laura Carno. She said that contribution was made possible by some out-of-state donors.
"Nonprofit"? What kind of nonprofit?

I turn to a recent Denver Post story and learn that
the El Paso County Freedom Defense Fund -- a group seeking a recall of Morse -- has raised about $16,400 . About $14,000 came from the local group I Am Created Equal.
OK: I Am Created Equal (which is the nonprofit run by political consultant Laura Carno) is a 527, which means it has to record and report contributions -- it acknowledges that it's political. But I Am Created Equal gave to the El Paso Freedom Defense Committee, and when you click on "Donate" at that group's site, you go to the donation page for the Basic Freedom Defense Fund -- which, you're told, is a 501(c)(4), i.e., a "social welfare" nonprofit that doesn't have politicking as its primary purpose.

This is true even though the URL for the El Paso Freedom Defense Committee is gotremorse.com -- a clear reference to John Morse, the guy targeted for recall. The entire site is about recalling Morse. Yet if you want to contribute, you're sent to a group that claims to be a tax-exempt "social welfare" group.

The Basic Freedom Defense Fund used to be called Colorado Accountability. There's an old Colorado Accountability page on the Web -- and that's all about recalling Democratic officeholders. And yet the group is a "social welfare" 501(c)(4).

The main group defending John Morse is A Whole Lot of People for John Morse (no, I'm not making that up). A Whole Lot of People for John Morse, we're told, "is an issue committee and not associated with any candidate committee." That's crazy, too.

People at the IRS may have mismanaged this system, but it's an insane system -- 527s are political but they can give to 501(c)(4)'s, which can assert that they're not primarily political even though any idiot can see that their resason for existing is to win elections. So if the system is mismanaged, maybe it's because the system is an utter disaster.


Victor said...

Just smash that whole section of the tax code with sledgehammers, and start all over again.

Neither Conservative groups, nor Liberal groups should be allowed tax exempt status - though with Liberal groups, they're less likely to define "social welfare," as wanting to privatize 'Social' Security, and throw people off of "Welfare."

Philo Vaihinger said...

Lawyers wrecking the system with their endless shyster facilitation of "tax avoidance," gaming the system and forcing it into ever more hopeless contortions.

Kathy said...

I'm clearly confused, because in my world, it's 501(c)(3) groups that are nonprofits. Some of the advocacy groups in the state have 501(c)(4) arms for the purpose of lobbying, and contributions TO them are not tax-deductible. The 501(c)(4) arms don't endorse candidates, but they do spend lots of time schmoozing legislators and other elected officials to get support for bills that would, we hope, improve social welfare. The (c)(3)s are the ones providing assistance and doing grassroots community organizing. And it's the (c)(3) designation that is very difficult to get.

Am I missing something?

Steve M. said...

The (c)(4)s, as I understand it, aren't supposed to have electoral politics as their primary purpose, though they can have some involvement in electoral politics. That standard seems very, very flexible.