Karl Rove's Donor Plan Could Run Afoul Of IRS, Congressional Report Suggests
Source: Huffington Post
For instance, a recent $4.2 million Crossroads GPS ad buy attacked four Democratic Senate candidates, using the figleaf of calling on them to do such things as repeal health care or "cut the debt" -- as if there was imminent action about to be taken on the Hill.
The CRS report notes, however, that "when there is no pending legislative vote or other non-electoral activity, the IRS rulings suggest it can be difficult for an ad to avoid being classified as campaign activity."
Crossroads GPS publicly released its 2010 and 2011 tax filings in April, claiming tax-exempt status as a social welfare group under section 501(c)(4) of the tax code.
But the IRS has not yet approved its status. Should the IRS conclude that the group is primarily political in nature, the results could be politically explosive. Tax experts tell The Huffington Post that political groups that don't disclose their donations and expenditures to the IRS are subject to a 35 percent penalty on all donations that should have been disclosed but weren't and another 35 percent for the expenditure of that donation.
Read more: http://www.huffingtonpost.com/2012/08/31/karl-roves-donor-plan-afoul_n_1847834.html
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