N.J. tea party group feels victimized by IRS

Unlike some nonprofit groups that have obtained tax-exempt status to help influence elections with millions of dollars in TV ads, the Greenwich Tea Party Patriots of South Jersey say they have no desire to flood the airwaves.

They just want to pay less for U.S. mail.

But the group's application for 501(c)(4) status, submitted in early 2011, has yet to be approved or denied by the IRS.

And amid a scandal unfolding in Washington that has led to the ouster of the IRS's acting chief, the group claims it was unfairly targeted by the agency and is threatening litigation if not granted tax-exempt status by Friday.

"We have a very large elderly population in our membership. Many don't have computers," said Brenda Roames, 61, president of the 2,000-member group. "We communicate through regular mail. We do send enough out that we can send bulk mail. But if we had the tax status, it would be relatively cheaper to do this."

On Tuesday, the Treasury Department's inspector general for tax administration released a report slamming the agency for using "inappropriate criteria" in reviewing organizations applying for tax-exempt status and making "unnecessary information requests" that resulted in "substantial delays" in processing applications.

For more than 18 months beginning in 2010, the agency flagged groups with words such as tea party or patriots in their names or that were critical of "how the country is being run," among other things, according to the report. The inspector general reviewed 296 targeted applications, only 108 of which had been approved. The remaining were pending or withdrawn.

"We have tea party in our name and patriots in our name. We fit all the target points they were going for," Roames said. "Not surprised."

Section 501(c)(4) of the tax code exempts nonprofits "operated exclusively for the promotion of social welfare," though they may lobby and participate in limited political campaign activity as long as that is not their "primary" purpose. Such groups include the National Rifle Association and the Sierra Club.

Tax-exempt status has been attractive to groups such as Crossroads GPS, backed by Republican leader Karl Rove, and Priorities USA, run by allies of President Obama, because it means they are not required to disclose their donors.

In its two-year-old application, Roames recalled, her group said it was an educational organization and included the core values of its mission statement: "Fiscal Responsibility, Constitutionally Limited Government and Free Markets."

The IRS is barred by law from discussing pending tax-exemption applications, a spokesman said. It has said that while the targeting of conservative groups was wrong, it was not politically motivated.

The Greenwich Tea Party meets once a month in Elmer, Salem County, but draws members from Gloucester and Cumberland Counties as well. The group holds Constitution classes and rallies, and has invited Democratic and Republican political candidates to speak, Roames said.

After it filed for tax-exempt status, the group was contacted by the IRS on April 27, 2011. The agency acknowledged receipt of the application and said the group could expect to hear back in 90 days, according to copies of correspondence the group provided to The Inquirer.

The group said it did not hear from the IRS again until 10 months later. On Feb. 23, 2012, the IRS's Cincinnati office - which vetted applications for conservative groups - sent it a letter asking for more information about its operations, including: the time, location, and content of each public event it had held; copies of handouts provided to the audience; "detailed contents" of speeches; and printouts of "Internet social media" used to promote the organization.

It was not clear whether the IRS violated its rules by asking for such information from the group. The inspector general's report says "unnecessary" information requested included questions about donors, "issues important to the organization," and its position on those issues.

On the advice of attorneys at the Washington-based American Center for Law and Justice, the Patriots did not provide the IRS with all of the information it sought. They say the IRS has not contacted them since.

"The IRS took a caricature of the tea party and essentially viewed it as a political party, as opposed to what these groups actually were: individual entities with individual purposes," said David French, senior counsel at the ACLJ.

In a letter dated Monday, the ACLJ wrote the IRS's then-acting commissioner, Steven Miller, demanding that its 10 clients - including the Greenwich Tea Party - be granted tax-exempt status by Friday. Otherwise, it said, it would advise its clients of their right to sue.

On Wednesday, Miller was forced to resign. Also, the Justice Department is investigating whether the IRS violated civil rights and misled Congress.

Roames said her group's board will meet Monday to discuss its options.

"It upset me because when I see things like this happening, here in America, it just makes me feel like I'm in a third world country," she said.