Colorado State House District 28 candidate Brittany Pettersen used to work (still works?) for New Era Colorado, a
nonpartisan left wing youth recruitment organization, so we weren’t surprised to see on Twitter that the embattled candidate leveraged the very partisan “nonpartisan” group’s volunteers to walk precincts. Unfortunately, that’s not allowed under the IRS rules.
According to the IRS, in order to be classified as a charitable organization eligible to received tax-deductible donations, such organization may not “participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office.” “The term ‘candidate for public office’ is defined as an individual who offers himself, or is proposed by others, as a contested for an elective public office, whether such office be national, State, or local.” Rev. Rul. 2007-41, 2007-25 I.R.B. 1421 (June 18, 2008).
Translation – if an organization is considered a 501c3 nonprofit, it means that they’re tax-exempt. That also means that they cannot coordinate with candidates. And Brittany Pettersen should know that, having worked at New Era in the past.
Following Pettersen’s bold admission on Twitter, the New Era Colorado Foundation – IRS Complaint 10-23-2012 (2) from a few Coloradans who thought perhaps Pettersen and New Era ought to color within the lines. The letter read:
Based on the activities described above and the relevant standards and requirements that apply to 501(c)(3) organizations, it appears that NECF may have violated the statutes and rules governing political activities of a 501(c)(3) organization. I respectfully request that the IRS commence an investigation into NECF’s activities as well as the tangled relationship between NECF and NEC.
If the IRS should find that NECF did participate or intervene in a political campaign at all, it should revoke NECF’s tax-exempt status as well as impose an excise tax on funds spent on or earned by such participation or intervention, or any other sanction that the IRS deems appropriate.
Given New Era’s participation in the uber-liberal, uber-rich funding scheme in Colorado, the amount that New Era (and possibly its contributors) could owe in taxes could be substantial. And, all because of problem child Brittany Pettersen’s belief that she doesn’t have to follow the same rules as the rest of us.