Following up on its lawsuit against the Internal Revenue Service (IRS), today Citizens for Responsibility and Ethics in Washington (CREW) filed a rulemaking petition with the agency seeking a revision to existing regulations to eliminate a glaring loophole that allows certain tax-exempt groups to engage in substantial political activity while keeping the identities of their donors secret.
Current IRS regulations grant tax-exempt status under section 501(c)(4) of the Tax Code to groups with a “primary purpose” of promoting social welfare. The tax laws, however, require such groups to be operated “exclusively” for social welfare purposes.