ALEC Faces New Challenge to Tax-Exempt Status
John Dunbar, News Report: The American Legislative Exchange Council (ALEC) “elevates commercial gain for a few over the well-being of society’s less fortunate,” says a complaint penned by Marcus Owens, the former chief of the Internal Revenue Service’s nonprofit corporations division, on behalf of Clergy VOICE, a group of ministers from progressive churches in Ohio.
A prominent tax attorney has accused an organization of state lawmakers and corporations officials with improperly claiming nonprofit status, alleging the group’s role is to benefit businesses, the Republican Party, and legislators and not the public.
The American Legislative Exchange Council (ALEC) “elevates commercial gain for a few over the well-being of society’s less fortunate,” says a complaint penned by Marcus Owens, the former chief of the Internal Revenue Service’s nonprofit corporations division, on behalf of Clergy VOICE, a group of ministers from progressive churches in Ohio.
ALEC has attracted attention recently for its model “stand your ground” and voter ID laws which led major corporate backers like Coca Cola and Kraft Foods Inc. to drop their membership in the face of a threatened boycott by activists. The Florida gun law became a hot topic following the slaying of Trayvon Martin, an unarmed teen, by a neighborhood watch volunteer in February.
Until recently, ALEC has enjoyed a low profile, despite its substantial influence over legislation in the nation’s statehouses. The group claims on its website that it has helped craft close to 1,000 bills introduced by state lawmakers and that “an average of 20 percent become law.”
In its complaint, Clergy VOICE says ALEC has “deliberately and repeatedly failed to comply with some of the most fundamental federal tax requirements applicable to public charities” and that evidence “quite strongly” suggests that the group is violating civil and criminal tax laws.
The clergy’s complaint goes beyond allegations of improper lobbying, claiming that ALEC exists for the “private benefit” of its members rather than for charitable, educational or other exempt purposes that serve the public interest and deserve special tax treatment.
The Center forwarded the complaint to ALEC’s media relations representative Tuesday via email but a call was not returned. The Center forwarded the complaint and questions Wednesday morning to the organization and was told it had been passed along to “appropriate parties” but did not receive a response.
The 30-page letter sent to the IRS on June 18 was inspired by a separate, whistleblower claim lodged by consumer group Common Cause in April, which alleged ALEC is a corporate-funded lobbying group, which violates IRS rules that govern 501(c)(3) nonprofit corporations.
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http://www.nationofchange.org/alec-faces-new-challenge-tax-exempt-status-1341243207
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