The Mad Hatter at the Tea Party

Many stories in the news about the IRS targeting Tea Party organizations which applied for tax-exempt status. Defenders of the IRS have attempted to explain away its actions, claiming that there was an explosion in applications for tax-exempt status.

There were other organizations seeking tax-exempt status during that time, notably the “Occupy” groups. They got tax-exempt treatment PDQ. How did this happen? It turns out that an existing tax-exempt organization can rent out its status to other groups. This is called “fiscal sponsorship“. The “Occupy”groups gathered under the umbrella of the Alliance For Global Justice (one-star rated by Charity Navigator, for its lack of transparency), paying them 7% of receipts.

Perhaps the GOP should be looking into the (ab)use of fiscal sponsorship. In the meantime, Tea Party groups may want to avail themselves of this means of securing tax-exempt status without the bother of IRS review.


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