May 19, 2011
Is the IRS sending a message?
The IRS is apparently using gift tax compliance to target certain big donors to Republican political advocacy groups. A group of six Republican senators has written to the head of the IRS seeking further explanation.
The New York Times reports:
The Republicans, all members of the Senate Finance Committee, which has oversight of the I.R.S., said they were concerned that political considerations might have played a role in the agency's decision to scrutinize such donations more closely. The senators are seeking the names of any agency staff members involved in that decision, along with internal documents and any correspondence with White House officials.
"This pattern of nonenforcement over a period of nearly three decades, coupled with the troubling issues regarding the adverse impact that enforcement might have on the exercise of constitutionally protected rights, raises important questions regarding the timing of the decision to enforce the gift tax on these contributions," the senators wrote. "Retroactive enforcement of the gift tax in this highly politicized environment raises legitimate concerns and demands further explanation."
For historical context, Hillsdale College Professor Burton Folsom begins a 2006 paper titled "FDR and the IRS" with the following:
"My father," Elliott Roosevelt observed of his famous parent, "may have been the originator of the concept of employing the IRS as a weapon of political retribution."
The Obama administration may be following a similar path.
A Wall Street Journal editorial describes the IRS action in more detail and acknowledges questions about whose idea the IRS action is. The editorial also notes the more chilling aspect:
A tax probe of donations given by a specific class of political donors is a boldfaced attempt to punish and discourage political speech.
We wish we were shocked, but the plan is merely the latest play by Democrats to crack down on donors who support their opponents.
The real targets of the disclosure project are conservative groups like Crossroads GPS and Americans for Prosperity, which have seen their fundraising and influence grow in recent years.
All this is done in the name of "transparency," which is a nice way of saying, we know where you live. The real goal is to intimidate business and big donors from giving money to Republicans.
Unleashing the IRS is an especially nasty turn.
The IRS is studying the senators' letter and did not have an immediate response, according to the Times.