Moms for Liberty’s non-profit status under scrutiny

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The culture war between the right-wing group Moms for Liberty, which seeks to enact conservative policies in schools, and the growing number of grassroots coalitions working against them, is about to elevate to a whole new level.

A Michigan lawyer, Sarah Cross, who is allied with the national progressive group Defense of Democracy, has drafted and filed a number of complaints to the Internal Revenue Service challenging the national Moms for Liberty’s non-profit status, alleging that many of M4L’s practices are both deceptive and in violation of a variety of IRS regulations governing the conduct of non-profit entities. She also wants the IRS to look into the fiscal practices of M4L’s local chapters, many of which have incorporated as separate non-profit organizations.

Moms for Liberty was founded in Florida and is headquartered in Melbourne, Brevard County, deep in DeSantis country. The group was originally focused on challenging mask mandates in schools during the height of the Covid pandemic but quickly pivoted to banning books with LGBT content from school libraries, enacting anti-trans policies in schools, and fielding conservative extremist candidates for school boards and small-town city councils. 

M4L was organized as a non-profit 501(c)(4) educational organization, which would make it exempt from many — but not all — taxes. But the one major advantage that 501(c)(4) non-profit status has over the more common 501(c)(3) designation is that the former does not have to release the identities of its donors. Given M4L’s penchant for secrecy, this is a desirable advantage.

Cross first encountered M4L several years ago when she started attending school board meetings in her Michigan home town. “I came to know their agenda at a school board meeting,” she explains. “And I became familiar with their tactics when one of their allies threatened to punch me in the face. So, I went about researching them — to my horror.”

In the course of her research, Cross realized how M4L was flouting the IRS rules that were incumbent with being granted non-profit status. “I felt that they needed to be held accountable.”

Over the course of several months, Cross researched and drew up a number of complaints addressing how M4L was ignoring or sidestepping IRS regulations, which she began filing in December 2021. 

One of Cross’ first complaints was to point out how little of M4L’s activities involve education.

First would be M4L’s political activity: 501(c)(4) organizations are permitted to engage in political activity — provided that is not their primary activity. Cross’ filing lists hundreds of examples of M4L endorsing and/or campaigning for candidates, both by the national organization and its many local chapters. Moreover, regulations mandate that “political education” be inclusive, bipartisan and public; Cross points out how M4L’s political activities are usually none of these.

Cross also contends that M4L doesn’t qualify as a political educational organization because it doesn’t actually produce educational material of its own. In the complaint, she maintains, “Moms for Liberty does not produce training and educational resources. The organization links to outside sources for those materials. It seems disingenuous to characterize links to Fox News and Glen Beck broadcasts as education.”

One of the mandates of the IRS to political education groups is that it “promote the common good and general welfare.” Cross argues that M4L does quite the opposite. “Moms for Liberty has a public facing stated goal of advocating for parents’ right to participate in their child’s education,” she writes. “But, what an organization says it does and what the bulk of its actual work is can be very different things. The true advocacy of Moms for Liberty is to eliminate Diversity, Equity, and Inclusion for education [DEI]. DEI is really just a fancy term for civil rights. It’s hard to see how advocating to eliminate DEI from schools can be framed as furthering the common good or general welfare.”

Another wrinkle Cross brings up in this complaint is that, according to IRS regulations, political expenditures in support of a specific candidate are taxable. Cross argues that such political activity is M4L’s primary concern. Were the IRS to agree with Cross, M4L, both nationally and locally, and its allies, could be hit with a staggering tax bill.

Another filing addresses the deceptive or misleading way in which M4L conducts its fundraising. Since it is incorporated as a 501(c)(4) organization, donations to M4L are not tax deductible, unlike the more commonly known (c)(3) public charity organizations (like churches, community centers, and some arts organizations) where donations are tax deductible. These organizations are required to prominently inform potential donors that their donation is not tax deductible.

Cross alleges that M4L seldom follows this rule, and provides many examples of such info being placed in out-of-the-way spots in microscopic type, or spots on websites where donors are misdirected before reaching a disclaimer.

Cross acknowledges that it could be years before a final determination is made, given how understaffed the IRS has been. The agency is over two years behind in investigating such complaints. She admits that, even with the prospective increase in IRS personnel, it could take upwards of two to three years for the investigation to be concluded.

Additionally, the IRS has certain privacy policies which prevent it from providing public updates on the disposition of such cases. Thus, if Cross wants to find out the results of her efforts, she will have to check on M4L’s status.

In terms of her ultimate goal, Cross is blunt: “I would like to see Moms for Liberty’s [non-profit] status revoked.”

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