Nonprofit acknowledges $500K in political activity to IRS

WASHINGTON - A nonprofit Michigan organization linked with Republican groups acknowledged more than $500,000 in political spending in 2014, less than a month after the Free Press reported that it had earlier reported no political activity to the Internal Revenue Service for that year.

In June, the Free Press reported that Citizens for Responsibility and Ethics in Washington (CREW) had filed complaints with the IRS against several social welfare organizations, including Michigan Citizens for Fiscal Responsibility, saying they had violated tax rules.

In mid-July, Michigan Citizens for Fiscal Responsibility filed an amended 2014 return with the IRS, listing $501,987 in political activity, including giving $155,000 to Hardworking Americans Committee, a Super PAC spending hundreds of thousands of dollars on Michigan state House and Senate races; $135,000 to the Republican State Leadership Committee; and $75,000 to the Michigan Republican Committee.

Federal tax law allows social welfare groups like Michigan Citizens for Fiscal Responsibility to hold nonprofit status and make political expenditures as long as it is not the group’s main focus and any political spending is reported. When it filed its complaints with the IRS in June, CREW said the Michigan group “failed to meet those simple standards.”

In a news release Thursday, CREW acknowledged that the group’s political spending -- now that it has been reported to the IRS -- was “technically legal.” The IRS has never finalized rules for what constitutes political activity for nonprofit groups and what qualifies as a nonprofit group’s main focus.

“Michigan Citizens for Fiscal Responsibility admitting to having spent hundreds of thousands on political activity is a good start, but that does not excuse them for attempting to hide it in the first place,” CREW Executive Director Noah Bookbinder said. “They shouldn’t have to wait until they get caught to come clean.”

(2016 © Detroit Free Press)


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