Watchdogs: End campaign groups' tax-exempt status

AP News
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Posted: Sep 28, 2011 11:42 AM
Watchdogs: End campaign groups' tax-exempt status

A handful of non-profit organizations engage in so much campaign activity that they should be stripped of their tax-exempt status, according to a complaint filed by two campaign-finance watchdogs Wednesday.

Democracy 21 and the Campaign Legal Center called on the IRS to investigate the groups, including major players like GOP-leaning Crossroads GPS and Democratic-leaning Priorities USA Action, which plan to spend millions ahead of the 2012 election.

"These groups are misusing and abusing the tax laws at the expense of the American people," said Democracy 21 president Fred Wertheimer. "It is clear that these groups have little, if anything, to do with promoting `social welfare' and everything to do with electing and defeating candidates."

Both Democracy 21 and the Campaign Legal Center filed a similar complaint in July seeking to limit how much so-called "social-welfare organizations" _ also called 501(c)(4) non-profits after a provision in the tax code _ could spend on campaign activities.

Crossroads spokesman Jonathan Collegio blasted the investigation request as "the fourth frivolous complaint in 12 months from a highly ideological group that wants to sic the IRS on its opponents."

The watchdogs have kept up their pressure since a 2010 Supreme Court ruling that opened the door for unlimited money by outside groups in elections.

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