House GOP's top tax authority intensifies scrutiny on a nonprofit linked to Stacey Abrams.
According to Fox News, the chairman of the House Ways & Means Committee, Jason Smith, is vigorously pushing the IRS to evaluate and potentially withdraw the tax-exempt status of the New Georgia Project, an organization with origins traced back to Stacey Abrams.
This contentious initiative stems from recent penalties imposed on the New Georgia Project by the Georgia Ethics Commission. The agency fined the nonprofit $300,000 for not disclosing over $7 million in funds related to the 2018 gubernatorial campaign.
Such financial unaccountability involves major consequences. Jason Smith described it as a historic penalty, not just in the state but perhaps nationally. He marked it as "the largest penalty in the Ethics Commission’s history and possibly the largest ethics fine ever issued in the United States."
To address these concerns, Jason Smith wrote to IRS Commissioner Melanie Krause. He urged a thorough audit of the New Georgia Project to ascertain if they breached their status by engaging politically.
Founded in 2013 to promote voter registration in Georgia, the New Georgia Project parted ways with its founder Stacey Abrams in 2017. Nevertheless, its activities during the politically charged 2018 election have drawn significant attention and criticism.
The function of organizations under the IRS's scrutiny is clear. According to Jason Smith, Internal Revenue Code Section 501(c)(3) bars entities like the New Georgia Project from participating in political campaigns to maintain their tax-exempt status.
Jason Smith emphasized the gravity of the infractions:
The findings by the GSEC reveal that the New Georgia Project not only participated but intervened actively in the 2018 elections in favor of Stacey Abrams and others, which constitutes a significant violation of their tax-exempt status.
A key distinction is made between the New Georgia Project and its affiliated entity, the New Georgia Project Action Fund, the latter capable of endorsing candidates but without tax-exempt privileges.
The distinction under federal law is significant, as a result, it can lead to severe financial and operational ramifications for violators. Specifically, the IRS holds the authority to revoke an organization’s tax-exempt status or impose excise taxes on it.
Moreover, this isn't the first instance of its kind, and the detailed request from Jason Smith to Melanie Krause asked for a prompt response. He stressed the necessity for the IRS to act swiftly to examine and potentially revoke the organization's status.
Meanwhile, Aria Branch of the New Georgia Project expressed their intention to move beyond past issues. "While we remain disappointed that the federal court ruling on the constitutionality of the Georgia Government Transparency and Campaign Finance Act was overturned on entirely procedural grounds, we accept this outcome and are eager to turn the page on activities that took place more than five years ago."
As this issue continues to develop, the focus remains sharply on the integrity of political funding and the strict adherence to tax laws governing nonprofit organizations. Ultimately, the outcome could set a crucial precedent for similar cases in the future.
