[EL] why seek c4 recognition?

Tue May 14 14:07:43 PDT 2013

Maybe a naive question. Don't groups that raise money for political
advocacy have to register either with the IRS or the FEC?  If they do
neither, don;'t they have to pay taxes on the money they bring in?
FRANK

Prof. Frank Askin
Distinguished Professor of Law       and Director
Constitutional Litigation Clinic
Rutgers Law School/Newark
(973) 353-5687>>> Mark Schmitt <schmitt.mark at gmail.com> 5/14/2013 4:59
PM >>>
I take it you are saying that lawyers like Cleta Mitchell, who say
they
represent several dozen of these organizations, only got involved
later?

That may well be -- it would be interesting to learn more.

I'm not sure that "looked at the Code" is really what most amateur
organizations do, but they may operate by word-of-mouth about what
they
need to do. I know that I've encountered any number of c(3) groups that
are
convinced that they need to launch a c(4) in order to do any lobbying
at
all, which is a huge and expensive misconception.

Mark Schmitt
Senior Fellow, The Roosevelt Institute
<http://www.rooseveltinstitute.org/>
202/246-2350
gchat or Skype: schmitt.mark
twitter: mschmitt9

On Tue, May 14, 2013 at 3:55 PM, Bill Maurer <wmaurer at ij.org> wrote:

>  You’re assuming that many Tea Party groups have advisors at all. 
In my
> experience, they are small, dedicated political amateurs who don’t
realize
> the breadth and scope of regulations governing both nonprofit status
and
> what is necessary to participate in political and ideological
discussions
> in this country.  They likely sought (c)(4) status because they
looked at
> the Code and that designation seemed to fit them best.****
>
> ** **
>
> Bill****
>
> ** **
>
> *From:* law-election-bounces at department-lists.uci.edu [mailto:
> law-election-bounces at department-lists.uci.edu] *On Behalf Of *Mark
Schmitt
> *Sent:* Tuesday, May 14, 2013 12:43 PM
> *To:* law-election at uci.edu 
> *Subject:* Re: [EL] why seek c4 recognition?****
>
> ** **
>
> ** **
>
> ** **
>
> I'm curious, then: Does anyone know why so many local Tea Party
groups did
> decide to file 1024's? I recall that long before last Friday, a
number of
> lawyers on this list, esp. Mr. Zall, had said that they discourage
(c)4
> clients from filing. Were the Tea Party groups just poorly advised?
Was
> Cleta Mitchell's advice on whether groups should file different from
other
> lawyers?****
>
>
> ****
>
> Mark Schmitt
> Senior Fellow, The Roosevelt
Institute<http://www.rooseveltinstitute.org/>
> 202/246-2350
> gchat or Skype: schmitt.mark
> twitter: mschmitt9 ****
>
> ** **
>
> On Tue, May 14, 2013 at 3:19 PM, <JBoppjr at aol.com> wrote:****
>
> Beth is absolutely right, IMHO.  Jim Bopp****
>
>  ****
>
> In a message dated 5/14/2013 12:04:43 P.M. Eastern Daylight Time,
> bkingsley at harmoncurran.com writes:****
>
> For some groups the question is why seek recognition, not why not.
>
> The form takes time and energy to complete. If you don't know the
lingo
> you risk saying something that raises a red flag and triggers
further
> scrutiny, so you'll spend time and energy responding to further IRS
> inquiries. To avoid that you can hire a lawyer and spend thousands on
legal
> fees. Plus it costs $850 just to file the application, for all but
the very
> smallest groups.
>
> And what are the benefits? If the IRS ever happens to audit your
group,
> you can rely on the determination to avoid retroactive revocation,
provided
> there have been no material changes in operations. If you're pretty
> confident where you fit in the tax code, that benefit is pretty slim,
and
> it can be easier just to start operating.
>
> Many groups do file a 1024, and of course my experience tends to be
with
> those who decide to do so, since they've probably come to me for
help.
> There are some ancillary benefits -- being able to provide assurances
to
> funders and other supporters that you're operating within the law, or
in
> some cases eligibility for local tax exemption. But for many the
plusses
> are not worth the hassles.
>
> Beth
>
> Elizabeth Kingsley
> Harmon, Curran, Spielberg & Eisenberg, LLP
> 1726 M St., NW
> Suite 600
> Washington, DC 20036
> 202-328-3500
> www.harmoncurran.com 
>
>
>
>
> -----Original Message-----
> From: law-election-bounces at department-lists.uci.edu [mailto:
> law-election-bounces at department-lists.uci.edu] On Behalf Of Rick
Hasen
> Sent: Tuesday, May 14, 2013 11:50 AM
> To: law-election at UCI.edu 
> Subject: [EL] why seek c4 recognition?
>
> Over on Twitter the NYT's Nick Confessore is tweeting about the
question
> why only some groups seek c4 recognition status. Apparently the
> Democratic-oriented Priorities USA has not.
>
> Can someone shed some light on the reasons why a group would not
seek
> such recognition from the IRS and what the risks are?
>
> Thanks!
>
> Rick
>
> --
> Rick Hasen
> Chancellor's Professor of Law and Political Science
> UC Irvine School of Law
> 401 E. Peltason Dr., Suite 1000
> Irvine, CA 92697-8000
> 949.824.3072 - office
> 949.824.0495 - fax
> rhasen at law.uci.edu 
> http://law.uci.edu/faculty/page1_r_hasen.html 
> http://electionlawblog.org 
>
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