Domestic Taxes

Watchdog: IRS should probe tax returns of group led by Grover Norquist

A Washington watchdog alleged Wednesday that Grover Norquist’s tax reform group filed inaccurate tax returns in 2010.

Citizens for Responsibility and Ethics in Washington (CREW) called on the IRS to investigate Americans for Tax Reform’s (ATR) returns.

{mosads}The group, founded and led by Norquist, is best known for the signed pledge it has elicited from numerous GOP lawmakers to never vote to raise taxes. ATR filed $4.2 million in independent expenditures with the Federal Election Commission (FEC) in 2010. But ATR only claimed $1.85 million in political activities for that time period, according to the complaint filed by CREW Wednesday with the IRS.

“Grover Norquist’s numbers just don’t add up,” CREW executive director Melanie Sloan said in a statement.

“Americans for Tax Reform spent millions of dollars in 2010 trying to defeat candidates who disagreed with its agenda, then left most of that spending off its own tax return,” Sloan said. “Perhaps Mr. Norquist should sign a pledge that he won’t lie to the IRS about his group’s political activity.”

Norquist’s group dismissed CREW’s complaint as baseless and politically motivated.

“Americans for Tax Reform’s reporting strictly abides by the definitions of political activity and political expenditures maintained by the FEC and IRS. This attack is political and CREW knows it is nonsense,” ATR’s communications director John Kartch told The Hill.

“It’s certainly not surprising that the [George] Soros-funded, left-wing CREW has issued another baseless complaint against a conservative organization.”

ATR files as a 501(c)(4) group, a tax-exempt organization whose primary purpose is not political activities. Groups that hold this status are required to report their activities and expenditures to the IRS to confirm compliance, the CREW complaint says.

Norquist’s group disclosed less than half of its FEC expenditures to the IRS, CREW claimed. Those who submit inaccurate filings can be subject to civil fines or even criminal prosecution, according to the CREW documents.

“Groups like Americans for Tax Reform already don’t have to disclose their donors despite their heavy involvement in elections. The least we should expect is that they truthfully report their political spending,” Sloan said in the statement.

“Given Mr. Norquist’s well-known interest in the tax system, surely he knew he couldn’t lie on his taxes. The IRS should investigate immediately,” she said.

The complaint was filed as Congress and watchdog groups are pushing government agencies for additional transparency and enforcement in the campaign finance process.

Most recently, seven Democratic senators announced the creation of a task force to push for additional disclosure from outside spending groups in elections. Several senators have called upon the FEC, the Federal Communications Commission and the IRS to hit outside spenders with additional transparency regulations.

CREW’s allegations also came during Sunshine Week, a week observed by watchdogs and lawmakers to promote government transparency.

— This story was updated at 5:56 with comment from ATR.


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