Pro-Israel Group Sues IRS Over Delay in Charity Applications
August 27, 2010 | Read Time: 1 minute
A pro-Israel activist group alleges that the Internal Revenue Service is holding up applications for tax-exempt status from organizations that oppose the federal government’s policy on Israel, according to the Forward.
The organization, Z Street, applied for nonprofit status in December. In a lawsuit in federal court, the group says an IRS agent told a Z Street lawyer applications from groups working on Israeli issues were getting extra scrutiny to determine if their activities “contradict the [Obama] administration’s public policies.”
The IRS declined to comment on the lawsuit, citing its traditional policy of declining to speak publicly about specific charities.
Tax experts were skeptical about Z Street’s contention that a special IRS unit is screening applications from Israel-related charities, the Forward writes.
A 1983 U.S. Supreme Court decision allows the tax agency to deny nonprofit status to organizations that act “contrary to established public policy”—by practicing racial discrimination, for example—but legal experts said the IRS has never invoked the ruling in relation to foreign policy.
