Former Congressional Candidate Sues IRS Over Campaign Regulations

A 2012 Democratic candidate for Congress is suing the Internal Revenue Service, saying a tax loophole allows groups like the American Action Network to spend millions on negative campaign ads.

Former 13th district candidate and Bloomington physician David Gill is filing the suit, along with Citizens for Responsibility and Ethics in Washington. The plaintiffs contend the IRS has failed to act against 501(c)(4) organizations that accept large contributions to influence elections. 

Gill said attack ads contributed to his loss to Republican Rodney Davis, and forced him to spend more than a million dollars himself to counter those ads.  Gill says campaigns should be transparent

“It is offensive that the IRS turns a blind eye to reality and allows partisan political groups to seek refuge in a provision of the IRS code that is meant to govern companies like volunteer fire organizations and homeowners associations," Gill said. "In joining the benefit of exemption from federal income taxes, and permitting them to hide the identity of donors."

The plaintiffs contend groups have been able to accept large donations for electioneering in the Supreme Court’s 2010 ruling favoring Citizens United.  Gill said lots of complaints have been filed, but he said the IRS has only noted ‘it’s aware of public concern.’ 

Gill lost to Davis by 0.3 percent of the vote.  Gill says the ads falsely claimed that he wanted to destroy Medicare and raise taxes, and he spent a lot of time and money to counter those ads.

“It was shameful to be out and about on the campaign trail and talk to people who indicated ‘oh, my mom is a Medicare recipient and she would have voted for you until she heard that you wanted to tear Medicare apart' when it fact, for all my career, I have stood for exactly the opposite of that.”

Former campaign manager Sherry Greenberg says campaign staff received a ‘tremendous’ number of phone calls, e-mails, and Facebook posts about what was seen in those ads.

“We had to spend an inordinate amount of time dealing with refuting these claims as well as trying to tailor our own media to counteract, or attempt to counteract what was being put forth in these ads,” she said.  “We basically didn’t know who it was that we were going against because the donors aren’t disclosed.”

The lawsuit asks a federal court to strike down the IRS regulation, and require 501(c)(4) groups to run exclusively for the promotion of social welfare.