The only group I've seen to date that has been denied for 501(c)(4) status was Emerge America. They had previously been approved in 2006, did no electoral work, and didn't campaign at all. Their mission was to train democratic women for office. When they tried to expand in Maine, it was denied. Furthermore, 501(c)(4) status was denied for the entire national organization.
Originally Posted by Dickieboy
Emerge America and its initial state programs were granted 501(c)(4) status by the IRS several years ago. Later, when a new state program applied for the same status, it was denied because Emerge works only with women who are in the Democratic Party, so the IRS determined this did not meet the definition of “social welfare” for the common good. We believed this denial triggered a review of the Emerge programs that had already been granted c4 status, and consequently those statuses were revoked. Becoming 527 organizations has not hurt our fundraising or organizational expansion – we report our donors and continue our work fully transparently.
Contrast that with Central Valley Tea Party . They were approved for 501(c)(3) status meaning they weren't allowed to engage in any politics. It's pretty hard for me to look at the CVTP and say that they're a legitimate 501(c)(3) considering that all they do is to "educate" people about conservative issues. I'm not even sure I'd qualify them as a 501(c)(4).
We should want two things. 1). All groups should be held to the same well defined standard. While they made efforts and at least recognized the problem, there is obviously no consistency in the way the IRS approved 501(c) organizations. 2). Donations used for independent expenditures should be made public. People and groups of people have a right to free speech in elections, but we also have a right to know who's speaking.