Correction to This Article
A Sept. 1 article incorrectly said that the Internal Revenue Service had named the NAACP as a group whose tax-exempt status was being investigated in response to questions from congressmen. Though the NAACP's status was investigated, the IRS did not name the group. A Sept. 1 article incorrectly listed several Republicans as having called for an Internal Revenue Service investigation into the tax-exempt status of the NAACP. Named were Sens. Lamar Alexander (Tenn.) and Susan Collins (Maine); Rep. Jo Ann S. Davis (Va.); and former representatives Larry Combest (Tex.), Joe Scarborough (Fla.) and Robert L. Ehrlich Jr. (Md.). The lawmakers forwarded complaints and requests for an investigation from constituents to the IRS.

IRS Ends 2-Year Probe Of NAACP's Tax Status

By Darryl Fears
Washington Post Staff Writer
Friday, September 1, 2006

Nearly two years after a controversial decision to investigate the NAACP for criticizing President Bush during the 2004 presidential campaign, the Internal Revenue Service has ruled that the remarks did not violate the group's tax-exempt status.

In a letter released yesterday by the NAACP, the IRS said the group, the nation's oldest and largest civil rights organization, "continued to qualify" as tax-exempt.

If the NAACP were stripped of the status, donors would not be allowed to claim contributions to the group on income tax returns.

Federal law requires tax-exempt nonprofit organizations to be politically nonpartisan.

"It was an enormous threat," NAACP Chairman Julian Bond said of the investigation. The opposite outcome, he said, "would have reduced our income remarkably."

Bond reiterated his belief that the investigation was politically motivated. He said the decision, received by the NAACP on Aug. 9, "meant that they thought they had harassed us enough and they could stop."

In a response to lawmakers who expressed outrage over the investigation in 2004, IRS Commissioner Mark W. Everson said the agency's examinations are based on tax law, not partisanship.

The commissioner said the investigation of the NAACP was undertaken because two congressional leaders, whom he declined to name, requested it. They were unhappy because Bond criticized Bush in a speech in July 2004, saying his administration preached racial neutrality and practiced racial division.

"They write a new constitution of Iraq and they ignore the Constitution at home," Bond said.

After filing four freedom-of-information requests, NAACP lawyers discovered that far more than two members of Congress called for an investigation and that all were Republicans.

Republican Sens. Lamar Alexander (Tenn.) and Susan Collins (Maine) called for the investigation.

Others included Rep. Jo Ann S. Davis (R-Va.) and then-Rep. Larry Combest (R-Tex.). Former GOP representatives Joe Scarborough of Florida, who now hosts a talk show, and Robert L. Ehrlich Jr., currently governor of Maryland, also requested a probe.

The investigation started Oct. 8, 2004, a month before the election. As the investigation dragged on into the following February, the NAACP announced that it would not continue to cooperate.

Angela Ciccolo, an NAACP lawyer, noted that although Bond's remarks were made in July 2004, the investigation did not begin until October, just when the NAACP was attempting to register voters. "The timing of the investigation is critical," she said.

When the investigation started, Bush and the NAACP were locked in a long-running feud that started shortly before the president's first election victory in 2000.

During that campaign, the NAACP ran television spots featuring the daughter of James Byrd Jr., a black man who was dragged to death behind a pickup truck in Texas in 1998. She criticized Bush, then governor of Texas, for not signing hate-crime legislation.

The rift grew when the NAACP charged that Republicans in Florida stole the 2000 election by turning black voters away from the polls.

Recently, however, the relationship between the group and Bush has begun to warm. Bush addressed the NAACP convention in July for the first time in his six years in office, avoiding becoming the first president since Warren G. Harding to snub the group for an entire presidency.

"It's disappointing that the IRS took nearly two years to conclude what we knew from the beginning: The NAACP did not violate tax laws and continues to be politically nonpartisan," said its president, Bruce S. Gordon.

© 2006 The Washington Post Company