The Treasury Inspector General for Tax Administration (TIGTA) has released an audit report addressing improvements in educating and enforcing the prohibition against political activities for tax-exempt organizations. The purpose of the audit was to determine the effectiveness of the Internal Revenue Service's (IRS) Political Activities Compliance Initiative (the Initiative). The audit addressed how effective the IRS is in addressing alleged incidences of political campaign intervention and "whether actions had detected repeated campaign intervention by previously identified organizations."

The audit found that the Initiative could be improved "to ensure that tax-exempt organizations receive timely notification that they might be involved in prohibited political activity. Also, the EO function needs to clarify why certain referrals are not included in the Initiative."

Recommendations laid out in the audit include :

• ensure that all referrals of potentially prohibited political intervention are reviewed in a timely manner.
• Improve the consistent understanding of prohibited political intervention criteria.

The IRS expects an active 2008 election cycle, and will start the Initiative even earlier this year. To read the full report, click here.

In June of last year, Americans United for Separation of Church and State (AU) requested that the Internal Revenue Service (IRS) investigate Bill Keller for possibly violating the political campaign intervention prohibition for tax exempt organizations. Keller has a call-in show on a Tampa television station and a Web site called Liveprayer.com. On May 11, 2007 Keller warned listeners; "if you vote for Mitt Romney, you are voting for Satan!" Now, the public is aware that the IRS is in fact investigating the case. According to the St. Petersburg Times, "the IRS gave him a week to assemble documents and videos of his television programs. . . Keller said he is prepared to fight if his ministry loses its tax-exempt status."

The American Bar Association Section of Taxation recommended guidance to be included in the 2008-2009 Treasury Department Internal Revenue Service (IRS) guidance priority list. The section asked for guidance in a range of practice areas including exempt organizations. Among many other recommendations, the request included guidance on "acceptable methods for determining whether an organization is conducting political activities (including both candidate campaign intervention and improper private benefit to partisan interests) as its primary activity (consistent with section 527 exemption), or as a less-than-primary activity (consistent with non-charitable section 501(c) exemption)."

OMB Watch filed comments on IRS guidance priorities urging the creation of a bright line definition of partisan intervention in elections.

Americans United for Separation of Church and State (AU) have asked the Internal Revenue Service (IRS) to investigate a Minnesota church whose pastor declared that Christians cannot vote for either Senator Hillary Clinton (D-NY) or Sen. Barack Obama (D-IL) in the presidential election. Pastor Gus Booth said in a May 18 sermon at Warroad Community Church in Warroad, MN, that Christians "cannot support Hillary Clinton or Barack Obama. Both Hillary and Barack favor the shedding of innocent blood [abortion] and the legalization of the abomination of homosexual marriage."

The Warroad Pioneer, a local weekly newspaper covered the sermon under the headline "Local pastor uses scripture to oppose presidential candidates Clinton and Obama." Booth sent the paper's article to both AU and the IRS. Americans United's mission is to preserve the separation of church and state as guaranteed by the constitution to ensure religious freedom for Americans, according to its Web site. According to AU's press release, the group also received an e-mail from the pastor noting that he had used his pulpit for partisan purposes. The email stated; "I am writing you to let you know that I preached a sermon in my church on Sunday, May 18, 2008, that specifically addressed the current candidates for President in the light of the Bible,' Booth wrote. 'As you can see from the attached newspaper article, I specifically made recommendations as to who a Christian should vote for."

In the press release, Rev. Barry W. Lynn, AU executive director, "called Booth's actions a flagrant violation of federal tax law. Churches and other tax-exempt organizations are free to address moral issues but are not allowed to engage in campaign intervention."

Americans United for Separation of Church and State (AU) announced May 29 that it has asked the Internal Revenue Service (IRS) to investigate possible political fundraising at the Takoma, Washington branch of the Christian Businessmen's Connection. The group hosted Republican gubernatorial candidate Dino Rossi at a May 21 dinner where fundraising envelopes were reportedly distributed.

See the AU press release here.

Posted by Kay Guinane, 05:04:19 PM