Cotton: IRS Needs to Relook at SPLC's Tax-Exempt Status

April 3, 2019

Sen. Tom Cotton (R., Ark.) said on Tuesday that the Internal Revenue Service (IRS) needs to relook at the Souther Poverty Law Center's tax-exempt status.

"They were founded decades ago, and they claim that their role was to fund lawsuits to eliminate the Democrats’ system of Jim Crow and segregation. Now, they’ve turned into just a serial defamer of their political opponents," Cotton said about the SPLC. "That’s why the IRS needs to relook at their tax-exempt status."

Cotton sent a letter to the IRS, urging the agency to investigate whether the SPLC should keep its classification as a 501(c)(3) nonprofit organization amid news reports of the organization's turmoil and

"The business model has paid well," Cotton wrote in the letter. "The SPLC has accrued more than $500 million in assets. According to the group's most recent financial statement, it holds $121 million offshore in non-U.S. equity funds. The SPLC uses these assets to pay its executives lavish salaries far higher than the comparable household average."

The Washington Free Beacon has previously reported about SPLC's finances. In early March, the Free Beacon reported the group has $518 million in assets, with $120 million now offshore.

"I don't know many charitable advisors who say it is best practice to send your endowment to overseas accounts in the Caribbean. That’s one of the reasons why Charity Watch gives them an "F" rating. A very well deserved "F" rating," Cotton said.

Cotton added that the organization has become a hate group themselves for defaming political opponents.

"As you said Tucker, they have really become kind of a hate group themselves. They have a so called 'Hate Map' and they use it to stigmatize their political opponents. Respectable, center-right organizations like the Family Research Council, or the Alliance Defending Freedom. It’s fine if you don’t agree with those organizations, there are plenty of groups on the left I don’t agree with, but I don’t try to stigmatize them as a hate group and then go pedal that to CNN, New York Times, or try and attack their donors," Cotton said.

The senator also referenced the recent turmoil at the organization. SPLC co-founder, Morris Dees, was recently fired over the turmoil among its treatment of its workers. Some workers have come out and described the work environment being toxic due to racism and sexism. Richard Cohen, the group's president, has also stepped down.

"Again, a five hundred million dollar so-called charity that has systematic racial and sexist discrimination problems and at the same time it’s simply using that money to target its political opponents," Cotton said. "That's not what American tax payers are subsidizing when we give people tax-exempt status. We give those things to churches, or adoption shelters, or shelters for battered women, not to defame political opponents, sexually harass every woman that works in your office, and discriminate against minorities."

Published under: IRS , SPLC , Tom Cotton