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Does Media Matters Violate 501c3 Status?

From FrontPage Magazine:

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Hillary and the Fairness Doctrine

By Joseph Klein
Monday, January 22, 2007

…Just to make sure that Hillary does not get Swift-boated like poor Senator Kerry or shown up for the hypocrite and opportunist that she is, a progressive media-monitoring organization with Clinton ties known as Media Matters for America is standing watch for her.

It helped to sponsor an online petition drive back in 2005 to “renew the Fairness Doctrine.” Interestingly, Media Matters also has a whole section on its website dedicated specifically to tracking anti-Hillary stories but none specifically devoted to any of her Democratic competitors.

Former Clinton Administration chief of staff John Podesta helped Media Matters get off the ground. And it has received a generous grant from a shadowy organization called Democracy Alliance, which was set up by a group of wealthy liberals in 2005 to act as a funding clearinghouse for progressive groups, led by former Clinton Treasury official Rob Stein.

In addition to funding from George Soros, we know that Democracy Alliance has received significant support from some of Hillary Clinton’s most important backers including Susie Tompkins Buell and her husband, Mark Buell, and financier Alan Patricof.

In short, through a layered web of well-funded progressive groups that have the revival of the Fairness Doctrine as one item on their agenda, Hillary’s supporters are doing their level best to eviscerate the conservative media before they can do anything effective to challenge her candidacy.

Rep. Louise Slaughter of New York, a friend of Senator Clinton, introduced a bill in 2005 to bring the Fairness Doctrine back.  She said that conservative radio is “a waste of good broadcast time, and a waste of our airwaves.”   She has also sought to include cable TV in her censorship net…

From Alt Press Onllne:

MEDIA GROUPS UNVEIL WEB SITE TO SUPPORT SLAUGHTER’S FAIRNESS DOCTRINE BILL

Thursday, 21 October 2004

Washington, DC – Leading media experts Tom Athans of Democracy Radio, David Brock of Media Matters for America and Andrew Jay Schwartzman of the Democracy Access Project have unveiled www.fairnessdoctrine.com to promote U.S. Rep. Louise M. Slaughter’s (D-NY28) legislation to reinstate the Fairness Doctrine.

Abolished during the Reagan Administration, the Federal Communications Commission’s Fairness Doctrine required broadcasters to equally cover all sides of important issues. The new web site offers comprehensive information on why the nation needs the Fairness Doctrine reinstated and a petition for supporters to demand that Congress restore balance to the airwaves…

Alas, the website fairnessdoctrine.com has been pulled down. Its records have even been scrubbed from the Internet Archive’s “Wayback Machine.”

Still, it is abundantly clear what was the purpose of the site, and how it ran counter to the guidelines of 501c3 tax exempt charities like Media Matters.

Here is a general summation of the requirements for tax exempt status from the Internal Revenue Service:

Exemption Requirements

To be tax-exempt under section 501(c)(3) of the Internal Revenue Code, an organization must be organized and operated exclusively for purposes set forth in section 501(c)(3), and none of its earnings may inure to any private shareholder or individual.  In addition, it may not attempt to influence legislation as a substantial part of its activities and it may not participate in any campaign activity for or against political candidates

The organization must not be organized or operated for the benefit of private interests, such as the creator or the creator’s family, shareholders of the organization, other designated individuals, or persons controlled directly or indirectly by such private interests.  No part of a section 501(c)(3) organization’s net earnings may inure to the benefit of any private shareholder or individual.  A private shareholder or individual is a person having a personal and private interest in the activities of the organization

Section 501(c)(3) organizations are restricted in how much political and legislative (lobbying) activities they may conduct

Despite the above guidelines Media Matter does seem to have worked quite often for the benefit of particular individuals, especially Hillary Clinton.

Indeed, it could be argued that the organization was formed to work for the benefit of Mrs. Clinton, which would also be a violation of the IRS rules.

But getting back to the “fairness doctrine,” here is more elucidation about lobbying from the IRS:

Lobbying Activity

In general, no organization may qualify for section 501(c)(3) status if a substantial part of its activities is attempting to influence legislation (commonly known as lobbying)…

Legislation includes action by Congress, any state legislature, any local council, or similar governing body, with respect to acts, bills, resolutions, or similar items (such as legislative confirmation of appointive office), or by the public in referendum, ballot initiative, constitutional amendment, or similar procedure…

An organization will be regarded as attempting to influence legislation if it contacts, or urges the public to contact, members or employees of a legislative body for the purpose of proposing, supporting, or opposing legislation, or if the organization advocates the adoption or rejection of legislation.

It is quite obvious that Media Matters has lobbied for the passage of the Slaughter “fairness doctrine” bill.

Also from the IRS, this more general guideline would seem to apply:

Political Campaign Activity

Under the Internal Revenue Code, all section 501(c)(3) organizations are absolutely prohibited from directly or indirectly participating in, or intervening in, any political campaign on behalf of (or in opposition to) any candidate for elective public office. 

Contributions to political campaign funds or public statements of position (verbal or written) made on behalf of the organization in favor of or in opposition to any candidate for public office clearly violate the prohibition against political campaign activity. 

Violation of this prohibition may result in denial or revocation of tax-exempt status and the imposition of certain excise tax. 

All of which would seem to indicate that Media Matters is very probably in violation of the IRS guidelines for 501c3 charities and that they should have their tax exempt status rescinded.

This article was posted by Steve Gilbert on Friday, October 5th, 2007. Comments are currently closed.

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