What is a 501 (c) (4) and “Dark Money”

Written by Barbara Smith,

Blogger at Hamilton Wenham Liberals for Democracy

https://www.facebook.com/HWdemocrats/

I am very concerned about the impact of “dark money” that allows unlimited amounts of money to pour into non-profits called 501 (c) (4) both at a national level and right here in the small town of Hamilton, Massachusetts.

What is a 501 (c) (4) ?

According to Ballotpedia:

https://ballotpedia.org/501(c)(4), 501(c)(4) refers to a section of the U.S. federal income tax code concerning social welfare organizations.[1] Corporations that have been granted 501(c)(4) status by the Internal Revenue Service are exempt from federal income tax.[2] However, unlike 501(c)(3) organizations, donations to 501(c)(4) entities are not tax-deductible for the individual or corporation making the donation. These organizations may engage in political lobbying and political campaign activities. This includes donations to political committees that support or oppose ballot measures, bond issues, recalls or referenda.

Dark Money

Since 501 (c) (4) nonprofits are no longer required to disclose the name and address of any contributor- the donations are also called “Dark Money”. The contributors may be connected to political candidates, churches or other entities such as the NRA.

According to the IRS:

“with the exception of private foundations, an exempt organization is not required to disclose the name and address of any contributor to the organization.”[6] As recently as in July 2018, the U.S. Department of the Treasury and the IRS announced that tax-exempt nonprofit groups under section 501(c) of the nation’s tax code would no longer be required to disclose the names and addresses of their donors on tax documents, as was previously the case. The policy change applied to 501(c)(4) groups.[7][8]

The organization may choose to disclose donors, or the donor may choose to disclose that he or she donated to a 501(c)(4) organization.

According to Senator Sheldon Whitehouse (D-R.I),

this decision could make it easier for foreign entities to influence U.S. elections by making undisclosed donations to politically active nonprofit groups. “When you have dark money, you have an avenue for foreign influence that by definition you cannot police. And why, in this world in which every red light is blinking, according to our own [director of national intelligence) about Russian interference, why would we want to expand this avenue, not narrow it?” Sen. Ben Cardin (D-Md.) said, “It jeopardizes our national security. It allows for us not to have transparency in our political system.”[19]

Senator Whitehouse describes how “dark money” impacts the selection of Supreme Court judges…. The Scheme 12 -JCN’s Opening Salvo / Twitter

Now I don’t believe that the people of Hamilton have to worry about anything as nefarious as foreign powers donating to a human rights coalition. However, I don’t believe that non-profits supposedly designed to provide social welfare should engage in partisan politics as the Hamilton Wenham Human Rights Coalition has done during the November 2021 election for state representative. This is anti-democratic!!!!

The HWHRCoalition blocked me from posting/commenting on their Facebook page because I did not support their candidate Jamie Belsito for state representative!

Adding insult to injury, is the way that the Coalition pressures Hamilton employees, officials and districtwide candidates to pledge allegiance to the HWHRC. The coalition may claim that nobody is pressured to sign a pledge, but clearly individuals who assert themselves by NOT signing are at a political disadvantage. They may be accused of being racist, a commie, a witch or whatever the current term used when an individual is an independent thinker.

The political neutrality of nonprofits is important so they can continue as safe places where people can come together to solve community problems. Indeed, in a recent letter to Congress, 4,500 nonprofits around the country signed onto a Community Letter in Support of Nonpartisanship.Source Name: Concord MonitorSource Link: https://www.concordmonitor.com/Protect-NH-nonprofits-10193569

One last word,

It is not normal for one individual, a School Committee member to strive control of all things Hamilton: the Board of Health, the Hamilton Wenham Human Rights Coalition, the Hamilton Human Rights Commission, the schools, even how Covid Test kits get distributed, etc. This power grab is out of control. I predict that next, she will be grooming a Select Board candidate, someone moldable, who signs her pledge and obeys orders. Hamilton residents, please be alert….

Resources

The Real Story Behind 501(c)(4)s and 527s — Part I | citizens for truth (wordpress.com)

https://nonprofitquarterly.org/501c4-nonprofits-image-problem-is-a-problem-for-all-of-us/

https://www.nationofchange.org/2020/10/28/280m-dark-money-spent-by-us-christian-right-groups-globally/

https://www.concordmonitor.com/Protect-NH-nonprofits-10193569

https://ballotpedia.org/501(c)(4)

https://www.propublica.org/article/irs-political-dark-money-groups-501c4-tax-regulation

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