Remember all the wailing about the supposed harassment by the IRS of right-leaning 501c3's? Darrell Issa having a field day in hearings? Looks like maybe they need to scrutinize them more, not less.
ProPublica on Monday documented how the Karl Rove-linked dark money group Crossroads GPS spent about $11 million more on political activities in 2012 than it disclosed to the Internal Revenue Service.
By comparing tax documents, ProPublica's Kim Barker showed how even though Crossroads justified its social welfare non-profit status by pointing to $35 million in grants it made in 2012 to other non-profits, "at least $11.2 million of the grant money given to the group Americans for Tax Reform was spent on political activities expressly advocating for or against candidates."
This means that Crossroads spent at least $85.7 million on political activities, not the $74.5 million the group reported to the IRS on its 2012 tax return. It also means political activities made up about 45 percent of Crossroads' total expenditures.
This means that 51 percent of the group's money was spent on political ads, which conflicts with its stated status of 'social welfare' group.
On its 2012 tax return, GOP strategist Karl Rove’s dark money behemoth Crossroads GPS justified its status as a tax-exempt social welfare group in part by citing its grants of $35 million to other similarly aligned nonprofits. (Here’s the tax return itself, which we detailed last week.)
The return, signed under penalty of perjury, specified that the grants would be used for social welfare purposes, “and not for political expenditures, consistent with the organization’s tax-exempt mission.”
This one instance shows how the social welfare groups get around the rules.
The transaction also provides a window into one way social welfare nonprofits work around the tax code’s dictate that their primary purpose cannot be influencing elections. Grants sent from one nonprofit to another may be earmarked for social welfare purposes, but sometimes end up being used to slam or praise candidates running for office.
I'm sure Darrell Issa will get right on it.