IRS Responds to Ethics Watch Call for Investigation
The Internal Revenue Service ("IRS") has responded to Colorado Ethics Watch's call for an investigation of four nonprofit groups, American Future Fund, Coloradans for Economic Growth, Freedom's Watch and Western Skies Coalition, that may have violated their tax-exempt status through their efforts to influence elections in Colorado.
On September 29, 2008, Ethics Watch called upon the IRS to investigate the four groups, all organized as tax-exempt organizations under Section 501(c)(4) of the Internal Revenue Code. Ethics Watch’s research uncovered evidence that more than half of the activities engaged in by the four groups have been partisan, non-educational activities that provide benefit to various conservative candidates for state and federal public office in violation of statutory requirements for 501(c)(4) organizations.
In a December 2 letter to Ethics Watch, the IRS stated that while it could not disclose the status of any investigation of the four groups, the information submitted would be considered by the IRS's enforcement program for tax-exempt entities.