Engaging in political activities as 100% of their operation. For instance, Karl Rove's Crossroads GPS entity. If you can point to any social welfare activity Mr. Rove is engaged in, I'd love to see it. But his group's primary purpose is required to be social welfare.
Rove's group pays no taxes because it is supposedly a social welfare group, but it's actually a political slush fund. And the Republicans, having broken the law flagrantly, are now attempting to prevent the IRS from taking any action to end their abuse of the tax-exempt nonprofit status. That's the scandal.
Crossroads GPS claims public policy advocacy, which is certainly allowed under 501(c)(4) (compare to the NRA's lobbying arm, the Institute for Legislative action, also a 501(c)(4), albeit not partisan, see again Republican ex-Senator Lugar spending more time with his family), and fits into the broad category of "social welfare".
"Rove's group pays no taxes..." because it is a non-profit. Contributions for political activity are taxed. And claims that it's a "slush fund", with all the connotations that implies, need more than just a bald accusation.
Look, this corruption of the political process is worse than Watergate, because it was successful in suppressing a lot of election year political activity, compared to the latter getting caught early and therefore not going very far. It calls into question the very legitimacy of Obama's reelection, as pointed out by e.g. James Tatarnto: http://online.wsj.com/article/SB1000142412788732371630457848... A lot of people including myself were wondering where the "Tea Party" was in the 2012 election ... well, now we know part of the answer: getting stomped upon by the IRS, or avoiding that and staying too small to matter.
You can stop your ears up and say "La, la, la" all you want, but we on the other side are not buying it. And your side should think really hard about the ultimate long term consequences of illegally suppressing the loyal opposition, if we're pushed out of the political process, that doesn't leave us with any palatable options.
Rove's group pays no taxes because it is supposedly a social welfare group, but it's actually a political slush fund. And the Republicans, having broken the law flagrantly, are now attempting to prevent the IRS from taking any action to end their abuse of the tax-exempt nonprofit status. That's the scandal.
http://www.newyorker.com/online/blogs/comment/2013/05/irs-sc...