Write-Offs: Environmental Group Accused of Lobbying, and IRS Releasing Donation Lists

March 7, 2002 | Read Time: 1 minute

A conservative organization wants the IRS to strip an environmental group of its tax-exempt status, charging that the group’s advocacy efforts amount to political lobbying, which is sharply restricted for groups organized under section 501(c)(3) of the tax code. The group, the Center for the Defense of Free Enterprise, says in a letter to the IRS that the Environmental Working Group submitted false or misleading reports to the IRS about its lobbying expenditures, among other things. The charity has denied the accusations, saying all of its actions have been legal and proper.
In a change from its previous policy, the IRS has begun releasing to the public “Schedule B,” the attachment charities submit with their informational tax returns that lists contributors. The IRS used to deny requests from the public to see the list, but the revenue service says it will now provide the form after redacting the names and addresses of contributors. The list would still show the dollar amounts for each gift and the type of gift, such as cash, real estate, or stock. Some charity leaders say they are concerned that releasing the list, even with the redacted information, will make it possible for people to identify individual donors. But the IRS has decided that public-disclosure laws require it to release the form. The revenue service is revising the Schedule B form for the 2002 tax year so that it will no longer state that it is “generally is not open to public inspection.”