Grassley Seeks IRS Counsel on Tax-exempt Group Facing Allegations of Vote Fraud

Grassley Seeks IRS Counsel on Tax-exempt Group Facing Allegations of Vote Fraud

Sen. Chuck Grassley, chairman of the Committee on Finance, today asked
the Internal Revenue Service to describe any enforcement action it might consider in response to
serious allegations of inappropriate activity by a tax-exempt group, the Association of Community
Organizations for Reform Now (ACORN). Four employees of the group recently were indicted for
allegedly submitting false voter registrations in Kansas City, Missouri. The indictments come on top
of many press stories across the country about ACORN's potential involvement in voter fraud.
On Oct. 25, Grassley wrote to ACORN about its activities but has not received a response.

The text of today's letter to the IRS and the text of the Oct. 25 letter follow here.

November 8, 2006
The Honorable Mark Everson
Commissioner
The Internal Revenue Service
1111 Constitution Avenue, NW
Washington, DC 20224

Dear Commissioner Everson:

I am writing to you regarding a tax-exempt organization, Association of Community Organizations
for Reform Now (ACORN) that recently had four employees indicted for allegedly submitting false
voter registrations in Kansas City, Missouri. These recent indictments come on top of many press
stories across the country about ACORN's potential involvement in voter fraud.

The Internal Revenue Service (IRS) has responsibility for enforcing our tax laws and ensuring that
nonprofit organizations such as ACORN abide by the rules. Engaging in vote fraud is not an
appropriate activity for an organization that receives special treatments and exemptions under the
tax code.

I have recently written to ACORN asking a number of questions as part of the Finance Committee's
ongoing review of nonprofit organizations being utilized as political campaign or lobbying vehicles.
ACORN has failed to respond to the deadline provided in the Finance Committee letter and I have
heard nothing to date from ACORN officials.

To assist the Committee in its review I request the following:

1) Please inform me of what actions the IRS is taking or intends to take in response to the indictment
of four ACORN employees for voter fraud in Kansas City?

2) Please provide me copies of all correspondence between ACORN and the IRS for the last five
years. Note: for this question and all questions, I am requesting it for all affiliates, subsidiaries and
related entities of ACORN both for-profit and nonprofit - these would include, but are not limited
to, the following ACORN affiliates and organizations:

ACORN Community Land Association of Illinois 58-1994668
ACORN Community Land Association of Pennsylvania 58-2122155
ACORN Dumont-Snediker Housing Development Fund Corporation 06-1548990
ACORN Law for Education Representation & Training 72-1325684
ACORN Television in Action for Communities 72-1054493 990PF
ACORN Tenant Union Training & Organizing Project 72-1384225 501(c)4
Arizona ACORN Housing Corp., Inc. 86-0748438
Mott Haven ACORN Housing Development Fund Corporation 11-3517199
Cypress ACORN Housing Development Fund Corporation 83-0385829
ACORN 2005 Housing Development Fund Corporation

3) If there have been audits of ACORN in the last five years, please provide me the copies of all the
results and findings of those audits. Please inform me of any current audits of ACORN as well.

4) Please provide copies of all ACORN filings with the IRS for the last five years.

5) In what instances, if any, does the IRS believe that the imposition of penalties under section 6700
and 6701 are appropriate for political campaigns, political parties or candidates who are engaged in
or plan or arrange activities with tax-exempt entities and the campaigns, candidates or political
parties provide false or fraudulent statements? Are there other circumstances in which penalties
under section 6700 and 6701 would be appropriate for improper political activity by a charity or
other tax-exempt entity?

6) Under what circumstances does the IRS believe it would be appropriate to bring an injunction for
a tax-exempt entity that is engaged in voter fraud under Section 7409? As a follow-up to the facts
in question 5, under what circumstances does the IRS believe it would be appropriate to seek an
injunction against a tax-exempt entity under Section 7408? Please provide the details of all actions
the IRS has taken under Section 7409 in the last five years.

7) It is my understanding that ACORN received a grant from the IRS for tax preparation/tax clinic
work. Please provide a copy of the grant as well as all reviews and audits of that grant. Please
provide me the details of how this grant was awarded to ACORN, including its score, reviewers
comments and the scores of all other applicants. Given the recent indictments of ACORN employees
for voter fraud, what steps are you taking to ensure that grant funds provided by the IRS to ACORN
are being used properly and appropriately?

Thank you for your time and assistance. Please provide this material within thirty days.

Cordially yours,
Charles E. Grassley

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