Politics

People Are Freaking Out That Karl Rove’s Crossroads Got Tax Exempt Status

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Juliegrace Brufke Capitol Hill Reporter
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Critics of Crossroads Grassroots Policy Strategies – the superPAC spearheaded by Republican strategist Karl Rove and former Republican National Committee Chairman Ed Gillespie – are not happy about the Internal Revenue Service (IRS) granting the organization tax-exempt status.

The group — which is now considered a 501(c)(4) “social welfare” nonprofit, allowing donors to give an unlimited amount of money while remaining anonymous — became one of the most prominent targets of an IRS scandal in which the agency preyed on right-leaning organizations.

Democracy 21 slammed the agency’s decision. It’s not surprise they’re unhappy: the left-leaning group was behind a complaint in 2010 with the Federal Election Commission (FEC) against Crossroads GPS, which led up to disgraced IRS employee Lois Lerner ordering the Crossroads to be audited.

“The IRS has failed to do its job to enforce the tax laws, which say that ‘social welfare’ organizations must be ‘operated exclusively’ for the promotion of social welfare activities,” Democracy 21 President Fred Wertheimer said in a statement.These are activities that do not include spending money to influence elections. The IRS also has failed the American people who will continue to be denied information they have a right to know about the sources of money being spent to influence their votes.”

Crossroads GPS President Steven Law said Tuesday he believes the group should have been approved sooner.

“We have always taken compliance very seriously, so we’re not surprised by the final result,” Law said in a statement, The Washington Post reports. “What we were surprised by was how long it took and how people outside the IRS improperly tried to influence and politicize the process, not just against us but against many other law-abiding advocacy groups.”

The New York Times editorial board came out against the Crossroads being granted tax-exempt status in a piece published Friday, saying the decision was “a shameful retreat by the IRS” and accusing the organization of failing to have “society’s nonpolitical interests at heart.”

“Since pioneering this fiction, Mr. Rove has proved to be no Mother Teresa of a social welfare advocate, as he strategizes obsessively for Republican hegemony,” the editorial board wrote. “His group has spent $330 million on election ads and candidate support since it was created in 2010, after the Supreme Court freed corporations and unions from political spending limits, according to the center’s watchdog blog, Open Secrets.”

Campaign Legal Center, a D.C.-based nonprofit, said the agency was “relentlessly bullied” into its decision.

“It was bad enough when the agency buckled to congressional pressure and postponed, until after this election cycle, a rulemaking to clarify the amount of political activity 501(c)(4)s are permitted to undertake while claiming federal tax-exempt status,” it wrote in a statement. “But giving Crossroads GPS its stamp of approval is further evidence that the IRS no longer has the will to enforce the law.”

Crossroads GPS – which was established just after the Citizens United ruling in June 2010 – was technically granted the status in November, yet the agency did not update its systems to reflect the status publicly until this week.

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