A Point about the IRS 501(c) scandal

Talk about a tempest in a tea (party) pot.

These social welfare tax exempts are entities that don’t pay taxes on their income which does not include contributions.  So these groups suck in money, spend it on ads, consultants and so forth.  How much income could they have?  Probably none.  A little interest earned on their bank accounts?  Totally offset by salaries, office expenses, etc.  See the point?

Contributions to these groups are not tax deductible.  Now if contributions were deductible then yes the IRS should police these vehicles closely.

So from a revenue standpoint, granting “tax exempt” status to “social welfare” entities makes zero difference to the federal fisc which is after all what the IRS should be trying to protect.

 

 

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