Pro-Israel Activists Petition IRS To Pull UNRWA's Tax-Exempt Status

Palestinian aid organization played central role in Oct. 7 massacre

(Jordan Pix/Getty Images)
January 30, 2024

The IRS is facing calls from lawyers and human rights activists to revoke the tax-exempt status for the United Nations' Palestinian aid organization amid new evidence that at least a dozen of the organization's employees participated in Hamas's slaughter last year of more than 1,200 Israelis.

A group of attorneys and pro-Israel human rights activists on Tuesday urged the IRS to launch an investigation into the U.N. Relief and Works Agency (UNRWA), an internationally funded humanitarian organization that has long faced scrutiny for promoting anti-Semitic hatred and for its ties to Hamas.

"We hereby demand that the exempt tax status of UNRWA USA be immediately suspended, pending an investigation, and then revoked," the lawyers and activists wrote in a letter sent to IRS commissioner Daniel Werfel, obtained by the Washington Free Beacon. "Providing support for an organization that incites and commits murderous violence while harboring members of U.S. designated terrorist groups that specialize in killing Jews and that call for Jewish genocide is obviously against both the law and public policy."

The U.S. government and several European governments suspended aid to UNRWA late last week after information emerged that at least a dozen of the agency's employees participated in Hamas's Oct. 7 terrorist strike on Israel. The Israeli government alleged in an intelligence dossier provided to UNRWA donors that at least 190 UNRWA employees double as Hamas militants or members of Palestinian Islamic Jihad, a designated terror group. Around 1,200 employees in Gaza are believed to have links to Hamas or Palestinian Islamic Jihad.

UNRWA has long been accused of promoting anti-Israel educational materials in its schools, advocating for Israel's destruction, and employing Hamas sympathizers. It first became clear late last year that UNRWA employees worked with Hamas to hold Israelis captive following the Oct. 7 attack. Fresh revelations last week that U.N. employees helped slaughter Jews, however, sent shockwaves through the international community and prompted a host of major donors to cut off funds. UNRWA now says that without funding from Western nations, its aid operations in the Gaza Strip will collapse in the near-future.

While the United States has suspended all new funding for UNRWA pending an investigation, the organization's American arm, UNRWA USA, still enjoys tax-exempt status under U.S. law. UNRWA USA engages in fundraising and advocacy work on behalf of the aid organization and is a key cog that has kept U.S. taxpayer funds flowing.

Given UNRWA's role in Hamas's war crimes, the IRS is legally obligated to revoke this status, according to the coalition of lawyers, led by the International Legal Forum and National Jewish Advocacy Center.

"It is no longer debatable; UNRWA is Hamas," the groups wrote. "Nor is it merely a 'few rotten apples' as some politicians and pundits have tried to suggest. The entire organization is a systematic incubator of hate, incitement and terror." UNRWA USA, the coalition adds, "supports them."

The call has also been echoed by Sen. Tom Cotton (R., Ark.), who said "the IRS needs to immediately revoke UNRWA’s tax-deductible status" as a result of its participation in Hamas’s crimes.

Funding to UNRWA was frozen during the Trump administration, which cited the group's ties to terrorism, but restarted when President Joe Biden entered office. The United States is UNRWA's largest donor and has contributed upwards of half a billion dollars since 2022.

After the Biden administration restarted funding, the State Department determined that UNRWA was inciting violence against Jews and allowing terror groups like Hamas to use its facilities, the Free Beacon reported in July 2022.

Following the revelation that UNRWA employees participated in the Oct. 7 massacre, GOP members of Congress have pushed to disband the aid organization.

"UNRWA is a front, plain and simple," Rep. Brian Mast (R., Fla.) said Tuesday as he introduced the UNRWA Elimination Act. "It masquerades as a relief organization while building the infrastructure to support Hamas. It is indoctrinating Palestinian children to hate all Jews and filling the future ranks of jihadists. It is literally funneling American tax dollars to terrorism."

UNRWA maintains that its funding should not have been cut off in response to "allegations against a small group of staff."

"It is shocking to see a suspension of funds to the Agency in reaction to allegations against a small group of staff, especially given the immediate action that UNRWA took by terminating their contracts and asking for a transparent independent investigation," the organization said in a statement.