Under questioning from a Democratic congressman, a top Treasury Department official testified that the kind of reported self-dealing that has transpired at the National Rifle Association would merit further inquiry into an organization’s tax-exempt status.
The exchange happened during a hearing on Thursday before the House Ways and Means Committee. Representative Bradley Schneider of Illinois asked J. Russell George, who serves as an ombudsman for the Treasury Department on matters related to the Internal Revenue Service, to respond to a set of actions alleged to have taken place at a hypothetical nonprofit organization. The examples included executives owning stakes in firms to which they directed business, a newly installed board president receiving a lucrative contract from the organization’s largest vendor, and the group’s leader charging travel and wardrobe expenses to the same top vendor.
“Would that be something the IRS should look into?” Schneider asked.
“Definitely,” George replied.
Schneider then revealed that his questions all pertained to specific actions by the NRA and its vendors, as revealed through an ongoing investigation by The Trace and The New Yorker, and additional reporting by The Wall Street Journal and The New York Times.
Separately, Schneider sent the IRS a letter formally asking the agency to investigate the NRA’s tax-exempt status.
“The allegations against the NRA reported in The New Yorker on April 17, 2019, including instances of egregious self-dealing, deceptive billing practices, and preferences in contracting are most troubling,” Schneider wrote. “The American people trust the government will actively ensure all organizations are not engaging in misconduct, and specific to tax-exempt organizations, refraining from impermissible political activity.”
Here is Schneider’s letter in full:
