The Heritage Foundation Is Using Anonymous, Tax-Deductible Donations To Blast Marco Rubio

Heritage Foundation ad on immigration with Marco Rubio

At right is an ad from the Heritage Foundation, attacking Sen. Marco Rubio (R-Fla.) for supporting immigration reform.

The graphic is part of a $100,000 online ad campaign that Heritage is running to stop immigration reform. And it’s financed with anonymous donations which the donors get to write off their taxes.

Heritage is a 501(c)(3) tax-exempt charitable organisation. As the IRS notes, any such organisation “may not be an action organisation, i.e., 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.”

Heritage has an action-organisation affiliate, called Heritage Action for America, which is organised under a different section of the tax code. Heritage Action runs lots of ads, and the donors who support its activities don’t get a tax deduction. But this ad isn’t coming from Heritage Action, it’s coming from regular Heritage, which means it was financed by anonymous, tax-deductible donations.

This isn’t to suggest the ad is illegal. 501(c)(3) organisations have a fair bit of scope in their activity. Not every statement for or against a bill counts as lobbying and not every ad that mentions an elected official counts as campaign activity.

But the ad does reflect a failure of our current laws: We have campaign finance laws designed to ensure political spending, and its funders, are disclosed. This ad campaign constitutes political spending by any reasonable lay definition, and yet its financing is not only undisclosed but tax-advantaged.

More broadly, the ad campaign reflects the ongoing debasement of think tanks: Nominally, these groups are supposed to be engaged in policy research, but they look increasingly like tax-advantaged vehicles for political activism. Tevi Troy wrote a great piece for National Affairs last year explaining and lamenting this trend.

It’s hard to see how the trend can be changed without a change in the tax laws that would make 501(c)(3) groups less appealing vehicles for political activism. So you should expect more ads very much like this one.

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