Exemption revoked for political campaign intervention

View official IRS release (PDF)

Plain-English summary

A section 501(c)(3) organization published website articles and newsletters and sent fundraising solicitations containing repeated statements supporting or opposing candidates in presidential and Senate campaigns. The solicitations reminded recipients that donations were tax deductible, and some statements expressly favored reelection or urged a candidate's defeat. The organization argued that its statements illustrated the risks of whistleblowing, could be interpreted differently, did not explicitly tell readers how to vote, and were sometimes made only to raise funds. The IRS found a deliberate and consistent pattern of political campaign intervention, which made the organization an action organization not operated exclusively for exempt purposes. It revoked the organization's exemption effective on the redacted July 1 date and stated that contributions were no longer deductible.

Ruling snapshot

• Question: Did the organization's published statements and fundraising solicitations constitute prohibited political campaign intervention?
• Outcome: Revocation of section 501(c)(3) status
• Key authorities: IRC §§ 501(c)(3) and 7428; Treas. Reg. § 1.501(c)(3)-1(c)(3)

Full text (IRS public release)

Internal Revenue Service Department of the Treasury

Appeals Office
1000 Liberty Avenue Employer Identification
Room 816 Number:

Pittsburgh, PA 15222

Number: 201416011
Release Date: 4/18/2014 Person to Contact:

Employee ID Number:

Date: December 30, 2013 Tel:

Fax:

UIL: 501.42-00
Certified Mail
Dear

This is a final adverse determination regarding your exempt status under section 501(c)(3)
of the Internal Revenue Code (the “Code”). It is determined that you do not qualify as
exempt from Federal income tax under section 501(c)(3) of the Code effective July 1,

Our revocation was made for the following reason(s):

Amongst other requirements, to be an organization described in Section
501(c)(3), an organization must “not participate in, or intervene in
(including the publishing or distributing of statements), any political
campaign on behalf of (or in opposition to) any candidate for public office.”
Treas. Reg. § 1.501(c)(3)-1(c)(3) provides that if an organization engages
in this conduct it is classified as an “action organization,” which is an
organization deemed to not have operated exclusively for tax-exempt
purposes and thus is not an organization described in Section 501(c)(3).
You operated as an action organization because you participated or
intervened in political campaigns on behalf of and in opposition to
candidates for public office by publishing and distributing statements. As
such, we revoke our previous favorable determination as to your exempt

status effective July 1.

Contributions to your organization are not deductible under section 170 of the Code.

You are required to file Federal income tax returns on Forms 1120. File your return with the
appropriate Internal Revenue Service Center per the instructions of the return. For further
instructions, forms, and information please visit www.irs.gov.

If you were a private foundation as of the effective date of the adverse determination, you
are considered to be taxable private foundation until you terminate your private foundation
status under section 507 of the Code. In addition to your income tax return, you must also
continue to file Form 990-PF by the 15th Day of the fifth month after the end of your annual

accounting period.

Processing of income tax returns and assessments of any taxes due will not be delayed
should a petition for declaratory judgment be filed under section 7428 of the Code.

We will make this letter and the proposed adverse determination letter available for public
inspection under Code section 6110 after deleting certain identifying information. We have
provided to you, in a separate mailing, Notice 437, Notice of Intention to Disclose. Please
review the Notice 437 and the documents attached that show our proposed deletions. If you
disagree with our proposed deletions, follow the instructions in Notice 437.

If you decide to contest this determination, you may file an action for declaratory judgment
under the provisions of section 7428 of the Code in one of the following three venues: 1)
United States Tax Court, 2) the United States Court of Federal Claims, or 3) the United
States District Court for the District of Columbia. A petition or complaint in one of these
three courts must be filed within 90 days from the date this determination letter was mailed
to you. Please contact the clerk of the appropriate court for rules for filing petitions for
declaratory judgment. To secure a petition form from the United States Tax Court, write to
the United States Tax Court, 400 Second Street, N.W., Washington, D.C. 20217. See also

Publication 892.

You also have the right to contact the office of the Taxpayer Advocate. Taxpayer Advocate
assistance is not a substitute for established IRS procedures, such as the formal appeals
process. The Taxpayer Advocate cannot reverse a legally correct tax determination, or
extend the time fixed by law that you have to file a petition in a United States Court. The
Taxpayer Advocate can however, see that a tax matters that may not have been resolved
through normal channels get prompt and proper handling. If you want Taxpayer Advocate
assistance, please contact the Taxpayer Advocate for the IRS office that issued this letter.
You may call toll-free, 1-877-777-4778, for the Taxpayer Advocate or visit
www.irs.gov/advocate for more information.

If you have any questions, please contact the person whose name and telephone number
are shown in the heading of this letter.

Sincerely Yours,

Karen A. Skinder
Appeals Team Manager

Enclosure: Publication 892

cc

Internal Revenue Service Department of the Treasury
TEGE EO Examination

1100 Commerce Street
Dallas, TX 75242

Taxpayer Identification Number:

Date: August 5, 2011

Tax Year(s) Ended:
Person to Contact/ID Number:

Telephone:
Fax:

Certified Mail - Return Receipt Requested
Dear

We have enclosed a copy of our report of examination explaining why we believe revocation of your exempt
status under section 501(c)(3) of the Internal Revenue Code (Code) is necessary.

If you accept our findings, take no further action. We will issue a final revocation letter.

If you do not agree with our proposed revocation, you must submit to us a written request for Appeals Office
consideration within 30 days from the date of this letter to protest our decision. Your protest should include a
statement of the facts, the applicable law, and arguments in support of your position.

An Appeals officer will review your case. The Appeals office is independent of the Director, EO Examinations.
The Appeals Office resolves most disputes informally and promptly. The enclosed Publication 3498, The
Examination Process, and Publication 892, Exempt Organizations Appeal Procedures for Unagreed Issues,
explain how to appeal an Internal Revenue Service (IRS) decision. Publication 3498 also includes information
on your rights as a taxpayer and the IRS collection process.

You may also request that we refer this matter for technical advice as explained in Publication 892. If we issue
a determination letter to you based on technical advice, no further administrative appeal is available to you
within the IRS regarding the issue that was the subject of the technical advice.

Letter 3618 (Rev. 11-
Catalog Number: 34800F

If we do not hear from you within 30 days from the date of this letter, we will process your case based on the
recommendations shown in the report of examination. If you do not protest this proposed determination within
30 days from the date of this letter, the IRS will consider it to be a failure to exhaust your available
administrative remedies. Section 7428(b)(2) of the Code provides, in part: "A declaratory judgment or decree
under this section shall not be issued in any proceeding unless the Tax Court, the Claims Court, or the District
Court of the United States for the District of Columbia determines that the organization involved has exhausted
its administrative remedies within the Internal Revenue Service." We will then issue a final revocation letter.
We will also notify the appropriate state officials of the revocation in accordance with section 6104(c) of the

Code.

You have the right to contact the office of the Taxpayer Advocate. Taxpayer Advocate assistance is not a
substitute for established IRS procedures, such as the formal appeals process. The Taxpayer Advocate cannot
reverse a legally correct tax determination, or extend the time fixed by law that you have to file a petition in a
United States court. The Taxpayer Advocate can, however, see that a tax matter that may not have been
resolved through normal channels gets prompt and proper handling. You may call toll-free 1-877-777-4778 and
ask for Taxpayer Advocate Assistance. If you prefer, you may contact your local Taxpayer Advocate at:

If you have any questions, please call the contact person at the telephone number shown in the heading of this
letter. If you write, please provide a telephone number and the most convenient time to call if we need to

contact you.

Thank you for your cooperation.

Sincerely,
Nanette M. Downing
Director, EO Examinations

Enclosures:

Publication 892

Publication 3498

Report of Examination

Letter 3618 (Rev. 11-
Catalog Number: 34800F

ISSUES

1. Whether participated or intervened

directly or indirectly in the United States presidential election or the
senatorial election on behalf of or in opposition to any candidate
during the taxable years ending June 30, June 30, or June 30,

2. Whether the organization's exemption should be revoked effective July 1,
   for engaging in prohibited political intervention.

FACTS

Background

The (the * or
“organization”) was recognized as an organization exempt from federal income tax
under section 501(c)(3) of the Internal Revenue Code (the "Code”) and classified as an
organization that was not a private foundation because it was described in sections
509(a)(1) and 170(b)(1)(A)(vi) in an advance determination issued in October
Following the completion of its advance ruling period, it was issued a definitive ruling
letter on October 11, affirming its status under section 501(c)(3) and its
classification as an organization that is not a private foundation because it is described
in sections 509(a)(1) and 170(b)(1)(A){vi). ;

The articles of incorporation of state, in part, that the purposes of
the organization are: “1. To support and encourage free speech, 2. To engage in other
charitable and educational activity as determined by the Board of Directors and 3. To
engage in any and all lawful activities incidental to the foregoing purposes except as
restricted herein.” The fifth section of the articles of incorporation states that “the
corporation shall not participate in or intervene in any political campaign on behalf of
any candidate for public office.”

The organization operated two websites with similar names. In a response dated June
19, to Information Document Request #5 dated April 11, the organization
states that the use of the first website, was discontinued in
late because of its inability to update the website or contact the website
administrator. The organization further states that the volunteer administrator became
unavailable and the domain name was not owned or controlled by the

After unsuccessfully attempting to regain control of the website,
was created in December and finalized for public

use on April 17, The website was updated to direct
viewers to the website in early
The majority of articles posted on were also posted on
Articles dated after January 10, are posted only on

The response further stated that the organization maintains no other web page.
However, this is inconsistent with the facts gathered during the examination. For
example, fundraising solicitations (see, e.g., solicitations PHH15, KPph3, KPph4,
KPph5 and KPph6 discussed infra) contain the statement “set up and maintained two
internet addresses to collect petitions, publish my op-ed columns, and display footage
anti-American activities” or contain the website addresses

of
and in the heading.
The Mission Statement posted on reads:
was formed

In support of the ideals of
to educate the public about his life and philosophy, and to
support and promote Freedom of Speech, as well as the other
Constitutional safeguards blessed to Americans in the Bill of

Rights.

will assist in the uncovering of serious wrongdoing in
the federal government, will promote and protect every citizen's
right to know, to speak out, and to correct corruptions no matter
where they may occur. will identify, encourage,
support and protect those who believe in free speech,
particularly as it applies to ethics and honesty in federal

government.

To this end plans to educate the public through
conferences, symposia, speaking events and other public fora.
also intends to accomplish its goals and convey its
message through the publication of pamphlets, newsletters,
books and similar written methods and through other forms of

media. Additionally, intends to promote the public's
understanding of the media and its role in today’s important
issues.

Year/Period
The organization was examined for the years ending June 30, June 30,
and June 30,
Officers/Directors/Board Meetings
The organization's president and founder is Attachment C to the
organization's Form 1023 dated September 18, listed as Director and
President of the and his wife as Director and
Secretary/Treasurer. No other officers were listed on Attachment C. The Forms 990
for the years ending June 30, June 30, and June 30, identify the only
Officer as
indicates the organization has one

The Form 990 for the period ending June 30, n
Officer, its President, and two Directors. In addition, the Form 990 indicates that the

President devotes 30 hours per week to the organization and that each of the Directors
devotes 10 hours per week. In a letter dated December 8, the organization
States that the time devoted by the Directors was an error and that the correct time

devoted by each is 10 hours per year.

The Form 990 for the period ending June 30, indicates that the organization has
one officer, its President, four Directors, and one Deputy Executive Director. The
President and Deputy Executive Director each devote 40 hours per week and each
Director devotes 0.20 hours per week.

The Form 990 for the period ending June 30, indicates that the organization has
one officer, its President, and four Directors. The President devotes 40 hours per week

and each Director devotes 0.20 hours per week.

During the years ending June 30, and June 30, three board meetings were
held on December 15, April 15, and December 16, , The minutes did
not identify which board members attended, other than to say that all board members
were present. The items discussed included _ programs and individual

cases.
Activities Relating tothe _Presidential Election

1. Alerts

The organization's previously operated website, displayed
articles titled * Alerts.” Some of these articles were written prior to the tax years
examined, but all were present on the organization's website during those years. The

Alerts were written by the organization's president, and included
logos of the at the beginning and end of each article. Many of the
Alerts contain statements pertaining to candidates for the presidential election
in The following are excerpts taken from * ALERTS’ on
(the full text of the quoted Alerts is contained in
Appendix A):
Clear Choice, February 4,
But articulated the most important difference between a
and a second term.... made it clear that if elected
would adopt the prior administration policies related
to terrorism, treating most terrorist acts as violations of law. ... Many

national security experts are convinced that the law enforcement
approach to worldwide fanatical terrorists failed dramatically . . . .

I hope we’ve had enough of the failed concepts for protecting our
homeland

should be reelected for that reason alone. . . .
Heroic , February 12,

No amount of or anti-war activity kept out of the

, 80 why should suffer from _ anti-war, anti-USA
excesses? The answer is, won't.... The Anti-anti Communists flock
to because and __ ilk had only compliments for the vicious
leaders of North Vietnam. . . .

I’m quite certain will be a “hero” to today’s peaceniks,
anarchists and any others who hate America. But for more than 50,000
whose names appear on the
_is nothing but a skunk.

I'm willing to bet will have no trouble dealing
with this coward.

GOP’s Harsh Rhetoric?, February 18,

What's said about each opponent during a political campaign is
important, but perhaps just as important is how the rhetoric is
“remembered by those keeping score. . . .

Meanwhile, those on the are calling the a liar, a
deserter and a moron; using over-the-top vicious rhetoric to vent their

hatred at this decent and = supporters.

And that’s OK, if you’re an emotional But let a
say the least negative thing about one of their candidates, and suddenly

it’s as if the world has been turned inside out.

Take for example. The are gleeful to trot out
war record and pointto decorations, conveniently ignoring the

fact that
when returned to the U.S. Moreover, _ rushed to join
crusade to crucify the United States of America for having the nerve to try

to stop the spread of deadly Communism.

Not satisfied with air-brushing weird reversals, including

bizarre testimony before Congress, when
~ without any supporting evidence — the

then attacked service.

It does not matter that . trained to fly a sophisticated jet
fighter aircraft and committed to respond at a moment’s notice to engage

in aerial dogfights or drop bombs over enemy territory. None of that
matters to They are determined to sully

military service record, even as they praise courage in becoming
an anti-war leader.

‘Needs to Answer, March 10,

The voters’ most important decision during this year’s .
campaign is to choose which candidate more efficiently handles national
security and defense. .. .

Americans should not be criticized for asking good questions about
Years after the worst attack ever launched against
America, we are without a single new assault on our homeland, because

of this feadership. Despite this level of success, some say it’s
time for a change.
Why? Are we tired of being Safe? is soft on national

defense, soft on intelligence agency funding and harsh on
record. ... It's ludicrous to suggest we change

Pumping Terrorism?, April 2,
Are OPEC nations joining forces with the terrorists and the camp?
If their announced decrease in crude oil production goes as planned, gas

prices will increase by at least 8 cents at the pump over the next few
weeks, and will continue even higher over the long-term.

Continued oil production squeezing will drive gas prices to the breaking

point. has already shifted blame to Stating
has not put enough pressure on OPEC to maintain crude oil

production. ... .

Unfortunately, if promises otherwise ill-informed swing-voters

lower gas prices at the pump, more than a few greedy, registered
ignoramuses will follow him anywhere. . . .

But is capable of such a Machiavellian deed? Has ever
aligned with America’s enemies for own political gain? The
answer in a word:

‘ Out of Gas?, April 20,

like are perpetually obnoxious busybodies, but put them in
& position of power and they become downright dangerous. The last time
a __ like occupied the — we ran out of gasoline.
Remember the long gas lines of the late 's? I've got an idea; let's
not go back to those bad old days of te...

just wants the and apparently say anything to get
the job.

Evidence, August 17,

If heard flimsy case, not only would throw it out,

probably would fine fifty dollars for annoying the court
and wasting its precious time. In view of the absence of any real
evidence, I think voters must assume true character
is highly questionable.

Pesky Citizens Will Not Shut Up!, August 25,

has held out as a and suggests should be
elected on that basis alone. has not talked about _ brilliance in
college, because there was no brilliance. has not bragged about
setting up and running a large business, because has never paid a
payroll. has not spoken about —_—syears in the because
there is nothing to talk about. . . .

Can't find any achievements and leadership qualities suggesting
material? How about —_ anti-war, anti-American

is
activities after returned from That would satisfy political
base of pacifists and those who blame America first. Otherwise, all
has to offer is which happened more than thirty
years ago.

‘Phony Evidence, September 13,

As we are distracted by the claims and counterclaims about
service to — country (recall, flew a multimillion dollar fighter jet

and was honorably discharged), the anniversary of September 11,
passes. ...

provided the leadership and made the correct personnel

and policy decisions to ensure we would be able to head off future
attacks. ideas and _ leadership have been the sole basis of our
comfort and safety as the rest of the world faces unspeakable horror. . . .

The Critics like to talk about but while our > was
acting frisky as a typical college student, young was

Hail ‘Pass, September 23,

axpay _ June 30,

has the voting record of a Sixties Hippie Pacifist, so how

could _ possibly trot that out as a reason to be
also participated in activities that some have said are traitorous when
conspired with the enemy to give swom testimony in front of Congress

that

In a Sane World, October 8,

Have you noticed how the candidates for the
are getting smaller and smaller? They are shallow in their experiences,

but it's their lack of any plan that's so impressive. If or
have a new or good idea, they have hidden it well. . . .

There are less than thirty days until the election, and we are a nation at
war. it's a given that have the right stuff to wage effective

and efficient wars, against terror and in the conventional sense. . . .

Too harsh, you say? How else do you explain that two lightweights,
acting like used car salesmen with few sales to their credit, are running
neck and neck with two real who rose to the occasion after

back into their primitive caves

and to the very depths of hell? .. .

We have seen as for the past four years. We
know who is not. What else do we need to see, or hear?

2. Fundraising Solicitations

The organization also made statements relating to the election in its
extensive fundraising solicitations. In response to information document requests, the
organization provided copies of many of those fundraising solicitations along with their
mailing dates and costs. Each solicitation closed with a reminder that any donations
were tax deductible. The following are excerpts from mailings contained in Appendix A.

From four identical solicitations titled KPph3, mailed July 6, KPph4, mailed
August 9, KPph5, mailed August 30, and KPph6, mailed September 27,

(The heading states “Americans for Truth About A Project of the
and lists the websites

and

lf you're outraged that candidate
refuses to release to the
American public, then please ston y your enclosed
petition to
When was recently asked to provide evidence of

attendance, _ willingly produced dental records and
other evidence of —_— service.

But refuses to a itical questions about liv
fourin home, and _ant rican activities

after the (emphasis in original)
I want to know what is hiding. .

Why did get a “free pass”

How did I avoid a
(emphasis in original)

And most importantly, what evidence of anti-American activities and
ties to Communist sympathizers is contained in secret FBI file that was
compiled by FBI agents who monitored —_ for more than a year? . ..

Some say is a shameless opportunist who denounced
to get into Congress and is now reinventing as I

& war hero to get into the

truth about before it’s too late. fate in original)
The last thing America needs is another liar in the

That's why I’m launching a very special project of The

in these last months before the election:

’ June 30,
My goal? To find out the truth about shady “service”
in .. “free pass" home...and ties to anti-American

Communist sympathizers when — got back.

But we are running out of time to expose ies, (emphasis in

original)
Recent polls show that is running neck and neck with
in the campaign.
But while has politely answered every question about his
service in the wee
(emphasis in
original)
From a solicitation titted PHH13, mailed August 3,
I have concluded that today’s are alike in two important ways:
_ are common liars and thieves! (emphasis in original)
... The fallout here in is still resonating now that we all

know that [sic],
is under FBI criminal investigation for

[sic] Is consultant and spokesman on
national security affairs! . . .

Incredibly, a significant number of these “forgetful” Americans would

actually consider giving another chance to lead this nation from
the .... (emphasis in original)
After left after a short term as a naval officer, then

engaged in a highly destructive, violently anti-American effort to force the
United States to abandon our fight against World Communism.

While engaged in activity that many would consider treasonous,
became the subject of a major FBI investigation! . . .

Form Explanation of Tteme Exhibit

We have already devoted significant resources to a new webpage,
and we will continue to appear on various media

Outlets to get the word out. .

‘PS, please send your most generous “summertime” gift and we'll continue
our important missions without pause. Together we'll keep t iars and

thieves out of power! (emphasis in original)
From a solicitation titled UBph1, mailed August 11,

may be out of the but another power
couple is shelling out millions of dollars to take it back over.

Yes, I'm talking about and _.

Just like are
who want to destroy the America you and I love. (emphasis in original) . . .

‘but shameful voting record

may call a
exposes for the really is:
A tax-and-spender who voted against middle-class tax
cuts.
A weak-kneed “leader” who voted to slash our defense spending and gut
the CIA.
A so-called “man of faith” who voted in favor of the gruesome partial-birth
abortion procedure. .
Make no mistake: is every bit as dangerous as

From a Solicitation titled PHH15, mailed October 28,

With the Election just one week away — I am facing an
Emergency. Here’s why: As you know, your
has spent the past eight months waging a petition campaign to demand

that release _— secret to the American Public - - and
find out once and for all what been hiding from us. (emphasis in
original)

I... joined with the in exposing ties to anti-

American communist sympathizers. . . .
You can — and should ~ feel very proud of the role you 1 played in helping

the expose the real
Can you help the Honor our debts from our “Expose
campaign with a tax-deductible gift of or today? ...

And if wins the we must be prepared to alert
Americans to any and every left-wing assault on our national security, our
sovereignty, and our U.S. Constitution!

Activities Relating to the Election

Shortly after the presidential campaign ended, the organization began making
campaign for re-election in These

statements opposing
statements included two fundraising solicitations, PHH-16 Low$, dated December 10,
and item PHH-16 High$, dated December 15 . These solicitations are
included in Appendix B and contained the statement:
You and I know is coming and we must be ready for can
be defeated in as tries to be elected ‘ from the state of
But, everyone expects _—to be the first choice to run for the
in I will be here to fight every inch of the way, but only

with your continued financial backing. (emphasis in original)

Similar statements appeared in the organization's newsletter, , and on the
website. The front page of the July edition of

‘contains an article, reprinted from an April 13, post on the
entitled !’ This article is included in

Appendix B and contained the following statements:
Is it too soon to get agitated about the possibility of

running for in Not according to
the head of ‘. In a recent fundraising letter he wrote, “It's
a race for America . . . stopping is the most
important thing you and I can do as in the next two years.”
went on to remind his readers that it is the duty of to
stop quest by running out of the It

might be helpful if the would focus on a few good candidates who
could replace but it’s a step in the right direction to remind voters who
really are. . . .

What will be effective if is to be defeated in and again in
is to inform voters not only about actual political agenda, but
also actual atrocious conduct. . . .

There may not be a party for political
activists who work to keep from power — but they will march forth
with a passion because they know the country will be better off without
in the

LAW

Section 501(c)(3) of the Internal Revenue Code (“the Code”) provides, in part, that an
organization is exempt if it is both organized and operated exclusively for religious,
charitable, scientific, testing for public safety, literary, or educational purposes and if it
does not participate in, or intervene in (including the publishing or distributing of
statements), any political campaign on behalf of (or in opposition to) any candidate for
public office.

Section 1.501(c)(3)-1(c)(1) of the Federal Income Tax Regulations (“the Regulations”)
states:

An organization will be regarded as “operated exclusively” for one or
more exempt purposes only if it engages primarily in activities which
accomplish one or more of such exempt purposes specified in section
501(c)(3). An organization will not be so regarded if more than an
insubstantial part of its activities is not in furtherance of an exempt
purpose.

Section 1.501(c)(3)-1(c)(3)(i) of the Regulations provides that an organization is not
operated exclusively for one or more exempt purposes if it is an “action” organization.
Section 1.501(c)(3)-1(c)(3)(iii) provides:

An organization is an “action” organization if it participates or intervenes,
directly or indirectly, in any political campaign on behalf of or in opposition
to any candidate for public office. The term “candidate for public office”
means an individual who offers himself, or is proposed by others, as a
contestant for an elective public office, whether such office be national,

State, or local. Activities which constitute participation or intervention in a
political campaign on behalf of or in opposition to a candidate include, but
are not limited to, the publication or distribution of written or printed
statements or the making of oral statements on behalf of or in opposition

to such a candidate.

Government's Position
General Summary

The organization has demonstrated a deliberate and consistent pattern of support for
and opposition to various candidates for public office, and engaged in these activities
during the election and the election. This is a
violation of the prohibition on political campaign intervention in section 501(c)(3) of the
Code.

Intervention in Election
The organization intervened in the election by making numerous

statements on its websites and in its fundraising solicitations which opposed
and

and . and endorsed for the offices
of and Some of these statements were explicit, such as

should be reelected for that reason alone,” “It's ludicrous to suggest we change
.” and “it's up to you and me to make sure the American people know the
truth about before it’s too late. The last thing America needs is another
liar in the ." Others contained more general statements supporting or

opposing candidates.

General statements made in opposition to candidacy in the months

leading up to the November election include an April 20, statement that “The last
we ran out of gasoline . . . let’s not go

time a guy like occupied the

back to those bad old days of ,” an August 17, statement that “I

think voters must assume true character is highly questionable,“

• an August 25, Statement that lacked leadership qualities and that

“all has to offer is short tour in which happened more than thirty

years ago.” The organization also made statements supporting the candidacy of
such as “ ideas and leadership have been the sole basis of

our comfort and safety as the rest of the world faces unspeakable horror.” In addition,

the organization unfavorably compared and with

and ', through statements such as “We have
seen as for the past four years. We know who is

not. What else do we need to see, or hear?,” “But while has politely
answered every question about service in the ...
refuses to tell the truth by releasing military records, military file and FBI file!,” and

*How else do you explain that two lightweights, acting like used car salesmen with few
sales to their credit, are running neck and neck with two real men who rose to the
occasion after September 11, , driving the terrorists back into their primitive caves

and to the very depths of hell?”

All of these statements were either made or were available after the
primaries had begun in January of and all of the individuals mentioned were on

the ballots in those primaries and, therefore, candidates for public office. These
statements, as well as the large number of similar statements contained in Appendix A,
demonstrate the organization's support for and its
opposition to and were published as website and newsletter
articles or distributed in the form of printed solicitation notices at numerous times in the
months leading up to the election. Therefore, the organization engaged in
prohibited political campaign intervention during the election

campaign.

Intervention in Election for in

The organization intervened in the election for U.S. Senate in by
making statements that urged defeat. These statements were
published on the organization's website and in the organization's newsletter in articles
entitled ” The articles contain statements opposing in
the election, including “What will be effective if is to
be defeated in and again in is to inform voters not only about — actual
political agenda, but also actual atrocious conduct.”

fundraising solicitations

Additionally, the December 10, and December 15,
candidacy by stating:

(PHH 16 Low $ and PHH 15 High $) opposed

You and I know is coming and we must be ready for
can be defeated in as tries to be elected _ from

the state of . But, everyone expects to be the first

choice to run for the in I will be here to fight every

inch of the way, but only with your continued financial backing.

was a candidate for re-election in Indeed, had maintained a
re-election website since as well as a political action committee for purposes of

‘promoting candidacy. Therefore, was a candidate for public office when these
statements were published.

Through the above statements published on the organization's website and in its
newsletter and fundraising solicitations, the organization demonstrated its opposition to

candidacy for the and, therefore, engaged in prohibited
political campaign intervention during the election for in
Taxpayer's Position

The organization has asserted that many of its statements were published to “illustrate
the dangers for individuals if they choose to come forward to reveal a controversial or
unpopular truth.” The organization asserts that its statements about the character of
various candidates could be interpreted differently by different people and may have
been considered unimportant. Finally, the organization asserts that many of its
statements do not contain statements that a person should vote for or against any
candidate. With regard to the fundraising solicitations, the organization has also
asserted that they were sent solely for fundraising purposes and not to influence an
election and that no funds received from such solicitations were used for campaign

intervention.

RECOMMENDATION

The organization engaged in prohibited political intervention in the
election and the election for in’ __ /The organization
published a series of written statements favoring the candidacy ¢ of

and opposing the candidacies of
throughout the relevant political campaigns. These written, published statements
therefore constitute intervention in a political campaign.

The taxpayer’s assertions that its statements were used to illustrate the dangers of

whistleblowing, that the character traits highlighted could be either positive or negative,
that no explicit mention of voting was included, and that some statements were made

solely for fundraising purposes, do not alter this conclusion. As set forth above, the
organization made repeated statements supporting or opposing various candidates by
expressing its opinion of the respective candidate's character and qualifications. The

statements included explicit support for re-election and disparaging
remarks about and fitness for office. These constitute

statements for or against a candidate, and therefore political campaign intervention,
regardless of whether the readers of the statements agree. There is no requirement
under the section 501(c)(3) prohibition on political campaign intervention that such

statements explicitly reference voting and there is no exception for fundraising
solicitations.

The organization has shown a pattern of deliberate and consistent intervention in
political campaigns in violation of section 501(c)(3) of the Code and section
1.501(c)(3)-1(c)(3)(i)(iii) of the regulations. Therefore, it is recommended that the
exempt status of the organization be revoked effective July 1,