Arkansas Attorney General Tim Griffin has been asked to review the behavior of a group promoting third-party candidates. The donor situation and legal status of No Labels, a centrist political group, has recently been called into question.
The No Labels website says the group's members want a “unity presidential ticket” for 2024. They claim to be against political extremism, saying that their group is made up of people from different political parties.
“We must recommit to the fundamental beliefs that have historically united Americans,” their website says.
No Labels is listed as a 501(c)(3) nonprofit that is tax exempt. In the U.S., there are rules about the way nonprofits are allowed to treat political campaigns. For example, under IRS code, “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.” Although, this regulation is often enforced sporadically.
Additionally, there are different rules governing the way money is collected within political parties versus tax-exempt charities. Political parties are required to reveal their larger donors and have donation limits, while nonprofits aren't held to the same standards.
In 2022, No Labels raised over $21 million from anonymous donors. A report from NBC said most donations came from a handful of larger donors. Because it's a non-profit, the group does not have to reveal the names of individuals or groups who gave money.
A separate left-leaning group called End Citizens United is concerned about the behavior of No Labels. They filed a complaint with the Internal Revenue Service saying the group is not operating as a non-profit as they are technically classified. Instead, the group alleges No Labels is functioning as a political party and acting to further their own financial interests.
“The facts strongly suggest that No Labels no longer operates exclusively for an exempt social welfare purpose as required by the Code,” the letter says. “Instead, No Labels’ public statements and reports of its financial activity strongly suggest it is operating in substantial part to sustain the political fortunes of the No Labels Party.”
End Citizens United is questioning No Labels' financial backing and asking for them to be reclassified as a political party. Reporting by the PBS Newshour says granting this request would be unusual in American politics, but the chances are not impossible.
End Citizens United also sent a request to Republican Arkansas Attorney General Tim Griffin asking for No Labels' status as a tax-exempt organization to be examined. The attorney general's office said this request is out of the scope of what the office does.
A spokesman said they do “not determine whether nonprofits follow federal tax law.” It went on to say that there is no evidence No Labels have broken any laws.
End Citizens United was formed after a 2010 U.S. Supreme Court decision, Citizens United v. Federal Election Commission. Justices ruled 5-4 that corporations could not be restricted form giving money to political campaigns on First Amendment grounds. End Citizens United now works to “get money out of politics.”
Meanwhile, No Labels asked in January for Democratic political groups to be investigated, claiming they're using “intimidation tactics” to silence them.
