Jason Chaffetz: Activists are weaponizing charitable giving -- And that means big trouble for every American

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Americans love charitable giving. We gave $410 billion to charity in 2017. But something is happening in the world of philanthropy that is not good for Americans or for the charities they love. Activists are weaponizing charitable giving, transforming nonprofits into tools of division and blatant partisanship.

Given the evidence I have reviewed, which you can read about in my new book "Power Grab," these are the organizations the IRS should be auditing.

We've long known that social welfare nonprofits, known by the IRS designation 501(c)(4), have become a conduit for dark money political campaign contributions. Donors can give unlimited amounts without disclosure. The nonprofit then packages those donations and contributes to other advocacy groups, who need only disclose the name of the nonprofit donor rather than its original donors.

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But new questions are raised by information found in the 990 tax filings of some 501(c)(3) charities – the type that provide tax write-offs and are prohibited from political activity.  This information suggests that donations meant for charity may be finding their way to political activities despite strict campaign finance regulations on charities.

The progressive for-profit group Grassroots Campaigns, Inc. brags on its website that it has raised $35 million from 984,000 donors "through millions of one-on-one conversations with voters."  But the group has a side gig fundraising for some of America's richest 501(c)(3) charities. Among its clients are Planned Parenthood, the Southern Poverty Law Center, and the ACLU.

Though each of these charities has a separate social welfare arm (a 501(c)(4)) to engage in politics, it is the charitable arm that employs the progressive canvassing group Grassroots Campaigns, Inc. for purposes of fundraising.

Here's where it gets fishy:  The charities that hire this company for fundraising services never come close to breaking even on the deal.

In the case of the Planned Parenthood Federation (PPF), which has assets totaling nearly half a billion dollars and an endowment fund of more than $157 million, Grassroots Campaigns hasn’t raised enough to pay for itself in the eight years for which I was able to see records.

More importantly, Planned Parenthood’s 501(c)(3) charity has paid out more than $11.5 million to the canvassing organization above and beyond the amounts they have received for fund-raising.

The time has come for the IRS to crack down on the political efforts of nonprofits. If they don't, America may find that some of our most prodigious nonprofits use their original purpose as little more than a side hustle. 

Planned Parenthood loses money on this arrangement year after year, yet they continue to engage them. Why?

This data raises serious questions.  Wouldn't a legitimate charity want to contract a fundraiser that raises more than it costs?  Or is this all just a method to unlock Planned Parenthood's vast charitable reserves for political purposes?  And has the IRS even noted the problem?

Since this has been going on since 2009, we can assume the IRS hasn't intervened.  Perhaps they were too busy looking for nonprofits with the word "Tea Party" in the name.

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When nonprofits leverage the power of their charitable assets, nationwide infrastructure, and grassroots networks obtained through decades of legitimate charitable work to engage in partisan political activity, such activities are deceptive, wrong, and potentially illegal.

The time has come for the IRS to crack down on the political efforts of nonprofits. If they don't, America may find that some of our most prodigious nonprofits use their original purpose as little more than a side hustle.

Remember when the ACLU paid for ads to ensure Supreme Court nominee Brett Kavanaugh would not benefit from the presumption of innocence?  Preserving such rights was once a foundational principle of the ACLU. But that organization, also a client of Grassroots Campaigns, Inc., seems far more focused on fighting President Trump than on preserving civil liberties.  More information about the ACLU and its relationship to the progressive fundraiser can be found in my book.

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The bottom line is this: Much of the campaign finance activity that is now illegal in the campaign world has shifted to the nonprofit sector. If this activity is allowed to proliferate, partisan political activity may swing the results of elections using the very methods Congress has criminalized on the campaign side.

The IRS has a duty and obligation to crack down on flagrant abuses of nonprofits' favorable tax treatment.