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IRS grants Kemp’s advocacy group tax-exempt status

December 3, 1997

WASHINGTON (AP) _ Proof that Democrats took part in Empower America activities has helped convince the Internal Revenue Service that the conservative policy group deserves nonpartisan tax-exempt status after all.

The IRS earlier had concluded that activities of the organization, led in part by former GOP vice presidential candidate Jack Kemp, ``substantially benefited the Republican Party and politicians affiliated with the Republican Party.″

``All we had to do is provide everything we had done and that was enough to change their minds,″ said Empower America spokesman, Christian N. Pinkston.

The group hired former IRS Commissioner Donald Alexander and pulled together ``every piece of paper produced by this organization″ to make the case its work crosses partisan lines, said Pinkston.

For example, Empower America showed it produced a videotape on education reform that featured Rep. Charles Rangel, D-N.Y., and a March 1996 conference on urban renewal featuring Sen. Joe Lieberman, D-Conn., and Al From, president of the Democratic Leadership Council.

In a Nov. 21 letter, the IRS said Empower America’s detailed presentation of its activities ``indicate clearly that you have engaged and are engaging in nonpartisan activities and are a nonpartisan issue advocacy organization.″

``They also indicate clearly that you have not engaged and are not engaging in activities that benefit selected parties or individuals,″ the IRS added.

Empower America, founded in 1993, describes itself as a ``unique combination of public policy institute and political advocacy organization″ which promotes ``progressive-conservative policies based on the principles of economic growth, international leadership and cultural renewal.″

The group counts House Speaker Newt Gingrich, R-Ga., and Senate Majority Leader Trent Lott, R-Miss., as board members. The IRS had noted that the group took many stances critical of the Clinton administration while its publications endorsed such GOP initiatives as the ``Contract with America.″

In February, the IRS initially rejected Empower America’s bid for tax exemption as a nonprofit group organized under Section 501c(4) of the tax law to promote ``social welfare.″ Tax-exempt status is lost if such an organization explicitly campaigns for individual politicians or political parties.

Harvey J. Berger, a specialist on nonprofit organizations with the accounting firm Grant Thornton LLP, said such a public reversal by the IRS ``doesn’t happen too often.″ Usually, the IRS will make a preliminary decision and offer the group a chance to respond before making a final decision.

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