Clinton charity, under pressure, will amend tax return errors

Reuters News
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Posted: Nov 04, 2015 12:30 PM

By Jonathan Allen

NEW YORK (Reuters) - The Bill, Hillary & Chelsea Clinton Foundation's flagship health project changed its mind again on Wednesday on the matter of its erroneous tax returns, saying it would refile them with the U.S. Internal Revenue Service after all.

The Clinton Health Access Initiative (CHAI) said the decision to refile its 2012 and 2013 returns was in response to "recent media interest."

Its brief statement made no mention of Republican criticism earlier in the week, when CHAI said it had decided against refiling the returns, known as form 990s. That, in turn, was a switch from the spring, when it said it would refile them after Reuters discovered it had misreported funding sources by millions of dollars.

"As previously stated, the minor errors on the 2012 and 2013 CHAI 990s are immaterial and do not require refiling, yet in response to recent media interest in the forms, CHAI has decided to refile the returns in order to be fully transparent," CHAI spokeswoman Maura Daley said in the statement.

With Hillary Clinton viewed as the favorite to become the Democratic nominee in the November, 2016, presidential election, Republicans have attacked her family's globe-straddling charities.

The charities have received millions of dollars of funding from foreign governments for their work on health and environmental projects. Republicans and other critics say this is an insoluble conflict of interest for a would-be U.S. president. CHAI is best known for helping reduce the cost of HIV drugs in the developing world.

Clinton has said her family's charities do worthy work and disclose more information about the donors than the law requires, mitigating that concern.

But she has not addressed the charities' admission to Reuters earlier this year that they did not comply with an ethics agreement Clinton signed with Barack Obama's incoming presidential administration in 2008 in order for her to become secretary of state. That agreement required the names of every donor be published annually, with the State Department ethicists screening new funding from foreign governments. The charities did not do this or did so incompletely, citing "oversights".

On Tuesday, Reince Priebus, the Republican National Committee's chairman, sent a letter calling on the IRS to audit CHAI and to compel the charity to amend the errors. On Wednesday, he responded to CHAI's decision to refile by saying an audit remained the only way to ensure all foreign government funding had been accounted for.

"CHAI has failed to comply with federal tax rules or the ethics agreement the Clintons negotiated with the Obama Administration," he said in a statement, "and re-filing erroneous returns seven months after the fact amid political pressure is hardly a show of good faith."

The IRS is barred by law from discussing specific cases. Spokesmen for Hillary Clinton did not respond to questions about the charities.

CHAI says the total amount of donations was correctly reported to the IRS in 2012 and 2013, but that the breakdown for how much came from government sources compared to non-government donors was incorrect.

Charities do not pay taxes on their donations, but must complete tax returns and make them public to demonstrate compliance with assurances made to get tax-exempt status.

(Reporting by Jonathan Allen; Editing by David Gregorio)