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IRS Allows Post-Citizens United Karl Rove Group to Continue Concealing Source of Donors

The Internal Revenue Service decided to grant “social welfare” tax-exempt status to Crossroads GPS.

(Photo: Business Bribe via Shutterstock; Edited; LW / TO)

The Internal Revenue Service decided to grant “social welfare” tax-exempt status to Crossroads GPS, an influential conservative political action group co-founded by Karl Rove in 2010, in the wake of the Supreme Court’s Citizens United decision.

The confirmation of the 501(c)(4) status by the IRS came last November after five years of deliberation. It was first reported on Tuesday by the Center for Responsive Politics (CRS).

The determination means that Crossroads will be able to continue raising unlimited sums of money from individuals and corporations to finance political activity without disclosing who is paying for it, per the 2010 SCOTUS ruling. The group must, however, ensure that its campaign spending does not exceed 50 percent of its outlays.

CRS noted that Crossroads has raised and spent at least $330 million since it was founded, “most of it on election-related ads and candidate support.”

The public interest group also remarked that, since Citizens United, Crossroads’ non-profit political expenditures alone have exceeded those “of all liberal dark money groups and unions combined, $142 million to $136 million, and that doesn’t include the thousands of traceable ads run outside the [Federal Election Commission’s] reporting windows.”

One Washington-based non-profit founded to limit “undue influence of big money in American politics” immediately blasted the November decision, after it was revealed on Tuesday.

“By no stretch of the imagination can Crossroads GPS be considered a ‘social welfare’ organization,” Democracy 21 President Fred Wertheimer said. “It is a political operation – the brainchild of political operative Karl Rove as a means to provide secrecy for donors who want to influence elections.”

“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,” he added.

In 2013, the IRS came under fire from conservatives after it admitted to mishandling the applications of Tea Party and other conservative groups, after the meteoric rise of the former amid well-funded right-wing astroturf campaigns. Crossroads said it may have been victimized by this additional layer of scrutiny.

In October, the Justice Department declined to file any criminal charges against IRS officials, concluding that “ineffective management is not a crime.”

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