November 13, 2003 | Read Time: 1 minute
The Internal Revenue Service has abolished a process through which it restored the tax-exempt status it had stripped from two groups tied to Newt Gingrich, former speaker of the House.
But ending the independent-review process has not stopped speculation that the IRS’s decision to restore tax-exempt status to the two groups was politically motivated.
In the spring, the IRS used the review process to restore the tax-exempt status of the Abraham Lincoln Opportunity Foundation, which helped pay for lectures by Mr. Gingrich, and the Howard H. Callaway Foundation, which made grants to the other group. The move reversed the IRS’s decision three years ago to take away the groups’ tax-exempt status on the grounds that they had improperly furthered Republican Party interests. Groups registered under Section 501(c)(3) of the Internal Revenue Code, as these groups were, are barred from engaging in partisan political activities.
Some critics of the IRS’s decision questioned whether the process was created solely to restore the groups’ tax exemptions. The IRS publicly denied the charge.
U.S. Representative Jim McDermott, Democrat of Washington, told the IRS that he continues to question how and why the review process was created. “The public deserves some explanation as to why ALOF [the Abraham Lincoln Opportunity Foundation] and the Callaway Foundation now are tax-exempt and eligible to receive tax-deductible contributions,” Mr. McDermott wrote in a letter to the tax agency.
