Israel Matzav

IRS: Does your organization support the existence of the land of Israel?

You will recall that Philadelphia-based Z Street is suing the IRS for denying it 501(c)(3) tax exempt status in a discriminatory manner. On Wednesday, the group introduced a letter in court from an IRS agent to another organization, asking whether that organization 'supports the existence of the land of Israel.'

"Does your organization support the existence of the land of Israel?" IRS agent Tracy Dornette wrote the organization, according to this week's court filing, as part of its consideration of the organizations application for tax exempt status. "Describe your organization's religious belief sytem toward the land of Israel."

The document emerged in the course of a lawsuit filed in August by Z Street, a hawkish group that casts itself as the Zionist answer to the liberal J Street. Z Street claims that a different IRS agent reviewing its application for tax exempt status said the agency is "carefully scrutinizing organizations that are in any way connected with Israel" and that "a special unit" is determining whether its activities "contradict the Administration's public policies.'"

The IRS can deny tax exempt status to groups that work against "established public policy," a precedent established in its denial of a tax exemption to Bob Jones University over racial discrimination, and Z Street is suggesting that the IRS has begun applying some such policy to pro-Israel groups. The State Department has complained of tax exempt contributions to groups that fund weapons and equipment for West Bank settlers, which Z Street co-founder Lori Lowenthal Marcus said Z Street has never come close to doing.

"Given that we have fallen within this net, how big is the net?" she asked.

The agent's question was contained in correspondence with "a Jewish religious organization" with no stated position on Israel, Z Street says in its court filing. The group's tax adviser, Z Street says, shared the correspondence with Z Street. Z Street does not know the name of the group and may subpoena the tax adviser, who is no longer cooperating with them, for more information, Marcus said.

Several experts on non-profit tax law said the questions to the organization were unusual, at best, though they were also skeptical of the claim that the IRS is specifically targeting pro-Israel groups.

Read the whole thing.

Are pro-Israel groups being targeted? With this administration in power, anything is possible.

Labels: Internal Revenue Service, Z Street

posted by Carl in Jerusalem @ 7:37 PM