By Michael Volpe
The Internal Revenue Service, which has been caught harassing conservative organizations with demands for personal ideological details, such as the content of prayers, now is doing the same to veterans’ groups.
Louis J. Celli Jr., director of the National Legislative Division at the American Legion, spoke exclusively with WND about the developing problem.
He said that officials at American Legion headquarters have been getting calls from a number of the group’s outposts complaining of IRS agents who, during the course of their inspections, were demanding personal information.
The information, Celli said, includes birth dates and Social Security numbers of members.
Celli said one outpost in Texas, where officials were unable to comply immediately with the requirements, was fined $12,000, or $1,000 for each of 12 days it failed to produce the documents the IRS demanded.
Celli lamented that such actions mean the American Legion will have less money for many of the veteran-related programs it sponsors.
“It’s such a shame, because that money could go to fund projects for our wounded warriors,” he said.
The situation has become so egregious that it has attracted attention in Congress.
On Aug. 28, Rep. Jeff Miller, R-Fla., fired off a letter to acting IRS Director Danny Werfel about the problem.
In the letter, Miller expressed concern about a change in bureaucratic language in an IRS field manual that now encourages IRS agents to ask groups like the American Legion for a series of documents that include unnecessarily personal information.
“As you know, 501(c)19 of the Internal Revenue Code provides tax exempt status to certain veterans’ organizations. Under Field Determination Guidelines published on January 27, 2011, these organizations are now required to provide IRS auditors with materials including ‘membership applications, DD Forms 214, or other discharge documents’ or risk significant financial penalties.”
The 501(c)19 tax code is most commonly used by veterans’ assistance organizations like the American Legion, same way churches use the 501(c)3 designation.
Celli explained that the DD 214 forms were not only cumbersome to provide but full of personal information on each individual member. He also said that on occasion, the IRS demanded that the American Legion provide discharge documents even on members who are still on active duty, without any explanation.
Miller blasted this rule in a statement in which he condemned the actions of the IRS as unfairly targeting groups trying to help veterans.
“As if we needed more proof the IRS is completely out of control. After illegally targeting innocent groups solely on the basis of their political beliefs, the IRS now appears to have America’s veteran’s service organizations in the crosshairs,” he wrote.
“Congress has already provided for the tax exempt status of many veterans’ organizations in recognition of both the selfless service of their members and the important role VSOs play in honoring, remembering and assisting some of the most vulnerable and worthy among us – wounded warriors, disabled veterans, military families, and the widows, orphans, survivors, and dependents of the fallen. Allegations that VSOs are now being unfairly targeted by the very government they sought to protect and defend are nothing short of unacceptable to me.”
Lori Lowenthal-Marcus said her pro-Israel group, Z Street, was subjected to similarly intrusive questions when that group applied for non-profit status.
She explained that after providing the IRS with a brief biography of each of her group’s board members, the IRS still demanded that she provide a formal resume of each of the board members without explaining what was missing in the biography already provided.
That dispute now is in court, with Z Street arguing that the IRS violated the group’s due process rights in the approval process.
Lowenthal-Marcus said that she believes that asking veteran’s assistance groups for such personal information could only be explained by bureaucracy run amok.
“Someone (within the IRS) must have gotten the idea that large organizations like these make for a good place to try and scam,” Lowenthal-Marcus said. “If that’s true, how offensive is that?”
Sen. Jerry Moran, R-Kan., also wrote Werfel, demanding that the new rule be suspended immediately while Congress has a chance to investigate the matter.
“At a minimum, I ask that the IRS cease carrying out this mandate until further review. We must be certain that the privacy of our nation’s heroes is respected. Given the American public’s increased frustration with the IRS and the failures of government bureaucracy at large, I am disappointed that such a policy targeting America’s servicemen and women would be a priority for the IRS. We must never forget that our country has a responsibility to protect its veterans who have put their lives on the line to defend our freedoms, and they deserve our utmost respect.”
The IRS has been the subject of intense scrutiny since it was revealed in May that it singled out conservative groups with “tea party” in their name for extra scrutiny. In those cases, IRS agents were instructed to pull any group with “tea party” in their name and perform a far more intense audit.
Multiple lawsuits have resulted from the IRS actions, and the Thomas More Society has said that several pro-life groups it represents allege IRS harassment. The legal group sent a letter to the House Ways and Means Committee complaining that several pro-life groups reported they were forced to answer intrusive questions such as “how often do you pray?”