IRS Proposed Rules Bad for Black Money–and LWV too

Elisabeth-Macnamara.LWVUSLWVUS President Elisabeth MacNamara has written to League Presidents warning that the proposed IRS regulations about political activity by Section 501(c)4 organizations would rein in the secret “dark money”, but might also hurt the League’s ability to do nonpartisan voter service activities. Read her letter and check out those IRS proposed rules.

Nancy Bickel

Tell me what you think at


Dear State and Local League Presidents:

The IRS has proposed very significant changes in the regulations that govern what kind of political activity and how much of that activity a Section 501(c)(4) organization can carry out.

This is important for two reasons:  1)  it is a tremendous opportunity to rein in the secret “dark money” that has been polluting our elections since the Supreme Court’s decision in Citizens United, and 2) the current proposal would significantly undermine the League’s ability to conduct truly nonpartisan voter service activities across the country.

The LWVUS has submitted comments to the IRS on the proposal, which can be found HERE.

It would be very helpful if you would submit comments on behalf of your state League urging the IRS to keep pushing to stop the dark money unleashed by Citizens United and to make sure that Leagues can continue our truly nonpartisan voter service work.

Reforming IRS regulations is a critical opportunity to respond to Citizens United, which allowed political operatives like Karl Rove on the right and Bill Burton on the left to raise and spend unlimited amounts of secret money in candidate elections.  By stopping 501(c)(4) organizations from spending on “candidate-related political activity,” the IRS can stop this abuse of (c)(4) organizations in its tracks.

For 94 years the League has played a unique role in our elections by providing truly nonpartisan voter services and information to voters across the country.  Unfortunately, the IRS proposal as it stands would jeopardize our work because it does not provide any exception for truly nonpartisan voter service activities like those carried out by the League. This is a terrible mistake, both for voters and for our democracy.

The League of Women Voters has a unique role in this debate.  The IRS needs to hear from you.

Please make the key points listed below and send them to the IRS by the deadline for public comments, February 27:

1)      Truly nonpartisan voter service activity must be allowed.  The proposed IRS definition of “candidate-related political activity” errs by including truly nonpartisan voter service activities by organizations like the League.  This should be corrected by applying the highly articulated “facts and circumstances” tests currently used by the IRS for 501(c)(3) organizations to 501(c)(4) organizations as well.  In addition, this body of law for 510(c)(3) organizations provides sufficient guidance to those organizations and should not be disturbed by the IRS.

2)      The “dark money” system must be stopped, and the exploitation of the 501(c)(4) status by organizations that intervene in candidate elections must be eliminated.  The IRS should prohibit “candidate-related political activity” by 501(c)(4) organizations.  The Internal Revenue Code is clear that 501(c)(4) organizations must be “operated exclusively for the promotion of social welfare.”  It simply is not a social welfare activity to work in ways that influence the election or defeat of clearly identified candidates for public office.

3)      The IRS should ensure that other 501(c) organizations don’t become a new vehicle for groups to hide the sources of vast sums spent on candidate elections.

4)      Since any organization or group of individuals can form a tax-exempt 527 organization, the elimination of “candidate-related political activity” by 501(c) groups does not ban any activity, it simply directs funds to a 527, where they are disclosed.

5)      Candidate-related political activity” should be defined as:

a)      mass paid public communications, such as broadcast advertising, phone banking, mass mailings, outgoing mass electronic messages, and mass leaflets

b)      that use the name or likeness of a candidate or otherwise clearly identify a candidate or political party.

6)      “Candidate-related political activity” should not include:

a)      Communications to an organization’s “members,” “supporters,” or other designated individuals who have affirmatively and actively asked to be associated with the organization.

b)      Taking a position on or advocating for a ballot initiative or referendum.

Your comments can be submitted via the Federal eRulemaking Portal at:!submitComment;D=IRS-2013-0038-0001

Please send us a copy of your comments as well.

If you have any questions or would like to discuss these issues, please contact Jessica Jones at the national office at

Thanks for all you do.

In League,


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