Did This Clinton Ally Nearly Break Tax Law To Help Hillary’s Campaign Chair?

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Michael Bastasch Energy Editor
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Center for American Progress (CAP) President Neera Tanden offered “assistance,” possibly through a tax exempt group, to push back on a story that made Democratic nominee Hillary Clinton’s campaign chair look bad.

“Let me know if there’s anything I or we (thru c4?) can do to help,” Tanden wrote to John Podesta in July 14, 2015. “It’s such outrageous bullshit.”

Tanden was referring to reporting by Politico’s Dylan Byers that Podesta worried about the “psychosis of the media.” Byers echoed the reporting of a conservative blogger who supposedly overheard Podesta saying he was worried about the “psychosis of the media … which is something we created.”

Byers said Podesta’s remarks speak “to how seriously the Clinton campaign fears the media’s role in the campaign, especially given the decadeslong tensions between Hillary and the press.”

“I feel like tweeting of course john thinks media is psychotic,” Tanden wrote. “But no doubt responsibility for that is media’s alone. But I won’t do anything unless you tell me it helps.”

“I think you could tweet: The media’s reaction to this story is a demonstration of his point,” Podesta responded.

Tanden didn’t tweet out exactly what Podesta said, but she did write the “[m]edia’s reaction to this inaccurate story… kinda proves Podesta’s point, no?”

Tanden’s email was one of more than 47,000 emails released by WikiLeaks from Podesta’s hacked Gmail account.

Tanden’s offer to use CAP’s political arm to push back against the media may run up against federal tax law.

Podesta founded CAP in 2003, and Tanden became its president in 2011. CAP has a political arm called the CAP Action Fund, that’s registered as a 501(c)(4) tax exempt organization. Tanden is also president of the CAP Action Fund.

While 501(c)4s can engaged in some lobbying and political activity, they can’t work with political candidates.

The Internal Revenue Service (IRS) says a 501(c)(4) “must not be organized for profit and must be operated exclusively to promote social welfare.”

“The promotion of social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office,” according to the IRS.

A 501(c)(4) “may engage in some political activities, so long as that is not its primary activity,” according to the IRS. “However, any expenditure it makes for political activities may be subject to tax under section 527(f).”

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