The IRS initially granted tax exemption to the progressive group “Emerge America” but revoked that status in the spring of 2010 when it came to the attention of agency officials that the group is devoted to training women to run for office as Democrats. The group has several state offshoots, including “Emerge Maine” and “Emerge Nebraska”; screeners were instructed to flag those applications because the agency was in the process of revoking the exemption of their parent group. A spokeswoman for Emerge America told Salon’s Joan Walsh in May:
Emerge America and its initial state programs were granted 501(c)(4) status by the IRS several years ago. Later, when a new state program applied for the same status, it was denied because Emerge works only with women who are in the Democratic Party, so the IRS determined this did not meet the definition of “social welfare” for the common good. We believed this denial triggered a review of the Emerge programs that had already been granted c4 status, and consequently those statuses were revoked. Becoming 527 organizations has not hurt our fundraising or organizational expansion — we report our donors and continue our work fully transparently.
David Marshall, an attorney in the IRS chief counsel’s office, supported the agency’s decision to revoke the group’s exemption. He had the following exchange with congressional investigators about the “Emerge America” cases:
Q: And was the issue in that case the level of political activity?
A: There was no question in my mind that there was political activity in that case.
Q: Enough activity to deem it —
A: It was clearly — it was clearly a problematic case. It was decided that it would be denied based on private benefit.
The IRS chief counsel’s office took seven months to come to this conclusion and, during that time, the “Emerge America” affiliates that had already received tax exemption continued to operate with that status.
“There is no comparison between screening applicants for a known bad actor that was having its tax-exempt status revoked after inappropriate conduct had come to light [and] systematic screening for groups who were subjected to inappropriate and disparate treatment above and beyond other groups simply because they had ‘Tea Party’ in their name,” Oversight Committee spokesman Frederick Hill tells National Review Online. “The fact that Emerge was initially approved for tax-exempt status, but had it revoked after its improper behavior came to light, underscores how much more stringent the IRS was with tea-party applicants.”
The IRS correctly denied some liberal groups tax exemption. That, it turns out, is what leading House Democrats mean when they talk about the IRS’s discrimination against their allies.
— Eliana Johnson is NRO’s media editor.