Americans Elect Press Conference Today: Democracy 21 President Challenges Americans Elect to Comply with Tax Laws and Campaign Finance Disclosure Laws

To accomplish this goal, Americans Elect already has qualified on a number of state ballots as a political party in order to run a candidate for president in 2012 who will be nominated by citizens using the Internet.

A report published yesterday by the Associated Press states about Americans Elect that, “The group, whose backers include both Republicans and Democrats anxious to open up the political process, has raised $22 million so far and secured ballot slots in Florida, Alaska, Nevada, Kansas, Arizona and Michigan. It has submitted signatures for certification in California, Utah and Hawaii.”

At the same time, Americans Elect claims to be a “social welfare” organization eligible for status as a tax-exempt 501(c)(4) organization. Such groups do not have to disclose their donors.

However, a political party is not entitled to be treated as a “social welfare” organization under federal tax laws and is required to disclose its donors.  Period. The idea that a political party – whose whole purpose is to nominate and elect candidates for office – can also be a “social welfare” organization for tax purposes is an oxymoron.

Whatever one thinks about the goals of American Elect, the organizations should not be misusing the tax laws or circumventing the campaign finance disclosure laws.

Americans Elect should be registered as a section 527 “political organization” under the tax laws, which would require it to disclose its donors.

Americans Elect was registered as a federal political committee until last October, when it switched and claimed it was a "social welfare" organization under section 501(c)(4) of the tax code. The reason for the switch appears quite clear: to keep secret from the American people the donors supporting its political activities.

Americans Elect correctly states on its website that “Americans are tired of politics as usual.”

However, attempting to claim that a “political organization” is a “social welfare” organization for the apparent purpose of keeping secret from the American people the donors financing its political activities is classic “politics as usual.”

Democracy 21 strongly urges Americans Elect to withdraw its request for 501(c)(4) tax status and to disclose its donors as required by section 527 of the tax code and by the disclosure rules that apply to federal political committees.