Tea party tax returns show small budgets, rare displays of overtly partisan activities
The Faulkner County Tea Party of Conway, Ark., which earned $7,847 in 2010, listed $570 for senior citizen transportation and $873 for a website and communications. The First Coast Tea Party Inc. of Jacksonville, Fla., noted $14 for cookbook expenses and $101 for Christmas ornaments. The Laurens County Tea Party of Laurens, S.C., which took in $2,400 in income in 2010 and is seeking tax-exempt status, listed $204 for buying T-shirts for members.
Those low-budget expenses also rarely showed evidence of direct political activity. The Faulkner County Tea Party described itself as "nonpartisan," promoting "fiscal responsibility, conservative principles and values in government, at all levels." The group paid $912 for a "meeting facility expense" and $180 in advertising in 2012. Even during the 2010 campaign, the group spent just $162 on a voter guide,
On the high end, Tea Party Patriots lavished $5.7 million in payments to three direct mail contractors and $1.8 million on fundraising and nearly $1.4 million on telemarketing in 2012. The group paid nearly $700,000 to Campaign Headquarters, an Iowa operation that advertises its voter contact phone and GOTV operations. In January, the activist group set up the Tea Party Patriots Citizens Fund super PAC, promising to seek unlimited contributions.
Unlike nonprofits regulated by the IRS, super PACs are monitored by the Federal Election Commission. Following the lead of multimillion-dollar campaign operations like GOP strategist Karl Rove's Crossroads GPS and the Democratic-leaning Priorities USA, large and small tea party groups have pressed for tax-exempt status over the last four years.
Some tea party groups have applied as educational groups under the 501(c)(3) tax code, while many others have sought 501(c)(4) status as social welfare groups. Under IRS rules, (c)(4) groups can be involved in politics if it is not their primary purpose, but (c)(3) groups are banned from most direct political involvement. Under federal law, both tax-exempt nonprofits can seek unlimited donations and do not have to disclose the identities of their donors.
An inspector general's report on the IRS' handling of tea party groups noted that auditors were poorly trained in distinguishing between the nonprofit classifications. "It led to inappropriate enforcement of the tax laws," said Jay Sekulow, a lawyer representing nearly two dozen tea party groups with the IRS.
The Houston-based King Street Patriots organization has been waiting since July 2010 for a decision on its tax-exempt status for itself and an allied group, True the Vote, a leading national conservative group aimed at confronting vote fraud. Catherine Engelbrecht of Richmond, Texas, an official of both groups, complained that she and her husband are not only wrangling with the IRS but have fielded inquiries from other federal agencies.
Engelbrecht said the couple has been contacted in recent months by the FBI's domestic terrorism unit, the federal Bureau of Alcohol, Tobacco, Firearms and Explosives and the Occupational Safety and Health Administration. Her patriots group is well-financed, listing $140,000 in revenue and $130,000 in expenses in its 2010 tax filings. True the Vote listed $64,000 in income and $38,000 in expenses the same year. The 2010 filings were the only recent returns that are publicly available.
The group was at the forefront of conservative efforts to target vote fraud in the 2012 election and said it trained as many as 1 million election monitors. Engelbrecht said her group was nonpartisan, but top Democratic Party election lawyers and activists closely monitored the group's Election Day activities and accused it of close ties with Republican Party vote-suppression efforts.
Engelbrecht said she worries that tea party groups were being targeted by the government.
"I'm very concerned," she said, about a "coordinated effort by the federal government to single out private citizens."
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