At the request of Subcommittee Chairman Sheldon Whitehouse, End Citizens United // Let America Vote Action Fund President Tiffany Muller submitted written testimony to the Senate Finance Committee Subcommittee on Taxation and IRS Oversight on today’s hearing on the laws and enforcement governing the political activities of tax-exempt organizations that claim to be apolitical and nonpartisan, yet engage in obvious partisan, electoral work.
Since the Supreme Court’s Citizens United v. FEC decision, there has been explosion of political spending by so-called “dark money” groups that are able to use 501(c)4 tax exemptions to hide their donors, whie influencing our elections. While the IRS is supposed to enforce laws that prevent these groups from engaging in electoral work, their enforcement has been feckless and nonexistent, allowing 501(c)4 tax-exempt groups to shirk the rules and spend millions of dollars on our elections without disclosing their wealthy donors.
Muller stressed in her testimony that these tax-exempt dark money groups face little-to-no oversight despite engaging in often explicitly partisan, political activity and urged Congress to pass a series of anti-corruption reforms to ensure transparency. The American people deserve to know who is working to influence our elections and for what purpose.
Click here to watch the Senate Finance Committee hearing
See below for key points from Muller’s testimony:
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Since the Supreme Court’s disastrous Citizens United v. FEC decision over 12 years ago, we’ve seen an explosion of political spending by “dark money” groups that don’t have to disclose their donors. In fact, there has been a more than ten-fold rise in undisclosed campaign spending since the decision, increasing from roughly $6 million in 2006, to more than $1 billion in 2020.
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Right now, the public knows the occupation of every donor who gives $200 to a campaign but almost nothing about wealthy individuals or corporations who give $2 million to political advocacy organizations trying to elect their politicians or secure judicial confirmations in hopes of securing their preferred policy outcome.
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There are several commonsense policies that can be implemented to address these issues.
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The IRS should institute rulemaking to develop clear definitions for political activity by these organizations and create clear bright lines for what constitutes political campaign intervention.
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Congress must permanently remove “riders” from appropriations bills that prevent the IRS from finalizing, issuing, or implementing such rulemaking.
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The House and Senate must also take up and pass the DISCLOSE Act (S. 443, H.R. 1334), legislation that would require groups that spend money to influence elections and judicial nominations to disclose their largest donors. Specifically, the DISCLOSE Act would require an organization that spends $10,000 or more on campaign expenditures to file a disclosure report with the Federal Election Commission within 24 hours of purchasing the expenditures. The DISCLOSE Act also addresses serious vulnerabilities in the system that currently allow foreign actors to meddle in our elections.
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