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Behind the Story: Tax forms and FEC filings reveal nonprofit's political activity

Learning about sources of political spending can be “like unpacking a Russian nesting doll,” says Michael Beckel, a politics reporter for the Center for Public Integrity.

Using tax filings as his primary source, Beckel investigated the third most politically-active nonprofit in 2012 as part of the Center for Public Integrity’s Consider the Source project.

 “In all, we examined records from the Internal Revenue Service, Federal Election Commission, Federal Communications Commission, the West Virginia Secretary of State’s office and the California Secretary of State’s office,”  Beckel said. The tax documents contained information the FEC filings didn’t have.  He called tax documents “a treasure trove, filled with information that is essentially hiding in plain sight.”

Part of the search is simply knowing where to look, Beckel said. He used Form 990s, the filings document all non-profits must submit to the IRS.  

“Within these filings, specific sections are focused on an entity’s lobbying activities, or the grants it’s doled out to other nonprofits, or the money it’s contributed to political organizations,” he said.  

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Beckel used sites like, and to learn how to search through the forms.

“For me, part of the process of understanding these filings has also meant tapping the expertise of other reporters around me and sources with intimate knowledge of them, including lawyers who specialize in tax law and campaign finance issues,” he said.  

Beckel compared the annual reports for the group and its largest donor, the Center to Protect Patient Rights, to determine their election activities.  

“Collectively, these documents showed detailed information about the groups’ receipts and expenses, with spikes in evenly numbered years when federal elections occurred,” Beckel said.  Beckel estimated that the difference in revenue for election years in comparison to non-election years was more than $20 million between 2009 and 2010 and again between 2011 and 2012.

“It was also noteworthy that when the IRS asked if the American Future Fund had any plans to spend money to ‘influence the selection, nomination, election or appointment’ of anyone seeking public office, it answered ‘no,’” he said.   Representatives for the American Future Fund wouldn’t comment on the purpose of their work for the Center for Public Integrity’s story.  

Beckel used information provided in the IRS Form 1024 in place of statements from American Future Fund representatives. Form 1024 is filed by nonprofits in order to obtain tax-exempt status from the IRS.

“While social welfare nonprofits, which are organized under Section 501(c)(4) of the U.S. tax code, are not required to file a Form 1024, many do,” Beckel said.  The American Future Fund had submitted about 100 pages of documentation through this form.

Despite sorting through hundred of pages of documentation, Beckel estimates the entire project only took a few weeks to complete.  “I found it gratifying to piece together all of these parts of the puzzle, combing through political spending records at the state and federal level, as well as tax returns for groups,” he says.  He hopes his work gives transparency to the way nonprofits and super PACs work and could potentially influence elections.    

You can reach Michael Beckel via email at or via twitter @mjbeckel.  

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