After pressuring dues-paying corporations to ditch the American Legislative Exchange Council, the good-government group Common Cause has launched a new attack on the American Legislative Exchange Council (ALEC) by challenging its status as a tax-exempt nonprofit.
Late last week, lawyers representing Common Cause filed a lawsuit under the Tax Whistleblower Act with the Internal Revenue Service accusing ALEC of violating its status as a 501(c)(3) nonprofit by “massive[ly] underreporting” its lobbying activities. The suit alleges that ALEC exists primarily to give corporate members the ability to “lobby state legislators and to deduct the costs of such efforts as charitable contributions.” Non-profits like ALEC can’t make lobbying a majority of their activities. (For a primer on ALEC, check out this 2002 Mother Jones story, “Ghostwriting the Law.”)
Bob Edgar, Common Cause’s president, said in a statement that ALEC “tells the IRS in its tax returns that it does no lobbying, yet it exists to pass profit-driven legislation in state houses all over the country that benefits its corporate members.” Edgar adds, “ALEC is not entitled to abuse its charitable tax status to lobby for private corporate interests, and stick the bill to the American taxpayer.”
SOURCE: Progressives: Yank ALEC’s Nonprofit Status! | Mother Jones.