A legal group has filed a complaint with the Internal Revenue Service and the U.S. Justice Department alleging the nation’s largest teacher’s union has failed to file proper federal reporting and tax statements regarding its political activity.
The Landmark Legal Foundation, which specializes in constitutional issues, said the National Education Association, or NEA, “has flagrantly ignored its tax obligations.”
“We have given the IRS and the Justice Department a step by step roadmap to investigate the NEA and, where warranted, pursue criminal charges,” said LLF’s president, Mark Levin.
The legal group points out the NEA is “required to report – and pay taxes on – all tax-exempt funds spent by the union to influence the election or defeat of any candidates.”
But LLF says it has examined thousands of NEA documents and determined “the union has concealed from the IRS tens of millions of dollars of tax-exempt dues it has spent on political activities.”
“The complaints we filed today show, in meticulous detail, how the nation’s largest, most powerful and most political union has flagrantly ignored its tax obligations,” said Levin.
As per IRS codes, said the legal group, the NEA is required to report and to pay taxes on “all tax-exempt funds spent by the union to influence the election or defeat of any candidates.”
That would include “millions of dollars in other political expenditures funded out of tax-exempt member dues over the past several years,” said the group.
Specifically, the legal group claims NEA:
- Spent $1,993,735 in the NEA’s Strategic Plan and Budget for fiscal years 2000-2002 for “[a] coordinated state-specific campaign developed and implemented to elect bipartisan pro-public education candidates in the 2000 general election.”
- Spent $76,400,000 to fund the UniServ program in 1999-2002 NEA Budget – a nationwide network of more than 1,800 NEA-funded affiliate employees who, according to one account, act as “the largest army of paid political organizers and lobbyists in the U.S., dwarfing the forces of the Republican and Democratic national committees combined.”
- Spent $ 9,600,000 in the NEA’s 1996 Strategic Focus Plan to “build bipartisan constituencies among those running for and elected to public office to support public education.”
Levin’s group claims none of those expenditures were reported to the IRS. However, said NEA legal representatives, LLF’s claims are without merit.
“In the past, what Landmark has done is make gross representations of fact and lifted statements badly out of context,” Richard Wilkof, an NEA attorney, told the Associated Press. “We feel there was nothing wrong with our activities in the past, and we continue to feel that way.”
Randall J. Moody, the NEA’s federal policy manager, said at the union’s political convention in 2003, “Politics move our policy. We work through UniServ.”
Uniserv is NEA’s network of representatives who provide services to the local affiliates, said the AP.
IRS officials, meanwhile, told AP they could not comment on the case.
But the legal group said under Internal Revenue Code (IRC) Section 6033, even tax-exempt organizations such as the NEA must file a form 1120 POL detailing the group’s political activities and expenditures.
“Landmark’s complaints demonstrate that the NEA has not filed a single 1120 POL with any of its tax returns since 1994,” said the group’s complaint. “In addition, the union claims on each of its tax returns that it spends nothing on political activities.”
Earlier legal opinions have supported LLF’s claims that the NEA has been in violation of IRS reporting rules.
According to a Sept. 15, 2000 letter from former IRS agent Edward D. Coleman, the nation’s tax agency found the NEA failed to report appropriate activities to the IRS.
“For at least the tax years ending August 31, 1994, 1995, 1996, and 1997, NEA has reported no such political expenditures” as appropriate to the IRS, the tax agency said in a Sept. 15, 2000, letter to the legal group.
Some lawmakers also have called for a tax investigation into the IRS.
U.S. Rep. Charles Norwood, R-Ga., formally asked the IRS in July 2002 to investigate the political expenditures of the NEA.
“The NEA’s own records seem to show a serious misallocation of dues money for political purposes, which its own general counsel, Robert Chanin, cannot explain,” Norword said.
“It’s about time the IRS begins to look at the accuracy of the NEA’s tax filings and the hundreds of thousands of dollars they owe in back taxes,” he added. “Let’s treat the NEA like any other tax-paying American.”