We all know that in the 2012 election season, outside groups fueled by unlimited checks from wealthy donors have been flooding America’s airwaves with campaign ads. Most of the attention in this sphere has focused on super PACs, the turbocharged offspring of political action committees.

But super PACs have in fact been outspent by another, more secretive type of political organization—nonprofits that declare their primary activity to be advancing “social welfare.” Dozens of so-called social welfare groups—such as the conservative Koch brothers’s Americans for Prosperity, the liberal Priorities USA, and Republican strategist Karl Rove’s Crossroads GPS—have been blanketing swing states with political messages, as the law allows. These organizations do not reveal their donors, and until 60 days before the general election, they were not required even to reveal their expenditures to the Federal Election Commission, as long as their ads do not endorse specific candidates.

None of this is illegal. But some of these social welfare groups do appear to have crossed the legal line. In August, a sweeping investigation by ProPublica found that many of them got formal approval and tax-exempt status from the IRS by misrepresenting their activities. A number of them, in fact, sailed through the IRS approval process by claiming that they would not spend money on influencing elections—only to turn around and purchase political ads as soon as the same day.

Last week, another ProPublica report revealed that a nonprofit was running clearly political ads in the Ohio Senate race—ads that praised the Republican candidate, Josh Mandel, and attacked his Democratic opponent, Sen. Sherrod Brown. That was the Government Integrity Fund, which had pledged to the IRS that it would not spend money on politics.

In the final sprint to the elections, many nonprofits are continuing to pour money into political ads—including some who misrepresented themselves to the IRS. On Tuesday, Politico reported that the nonprofit American Action Network will be launching a multimillion dollar ad campaign in partnership with the super PAC Congressional Leadership Fund on behalf of Republicans in the House of Representatives. This is a group that ProPublica found to have broadly misrepresented its spending in tax returns to minimize its political activity.

Many of these “social welfare” nonprofits properly told the IRS that their activities would be political in nature. But as ProPublica has reported, many social welfare groups got formal recognition by misrepresenting their activities to the IRS. The motive may have been to avoid a slower and more careful IRS approval process.

Who is keeping an eye on this kind of illegality? The media certainly should. And the profusion of nonprofit political ads offers a particularly golden opportunity to do so for reporters in swing states. Testing the accuracy of IRS filings of self-declared social welfare groups that run political ads is a straightforward and easily replicated process. CJR went through it, and also spoke with ProPublica reporters Kim Barker and Justin Elliott, to figure out exactly how its done.

Here’s what we learned. Below are three steps for determining whether a social welfare group is deceiving the public:

1) Identify the sponsor organization

Before anything else, figure out the name of the group that is running the ads. Whether you see a political ad on TV that makes you want to dig into its backers—or you want to search political ads in your local market—you can do so using ProPublica’s Free the Files application. Free the Files scrapes the Federal Communications Commission website each day for the disclosure files that some broadcast stations are required to post when they run political ads. Free the Files can be searched either by television market or by ad buyer.

When you get to the market or organization that you’re looking for—for example, here’s the page for the nonprofit Crossroads GPS—you can click on the ad files shown in the lower left section of the screen to examine specific ad buys. Keep in mind that the overall numbers shown in ProPublica’s application are not totals: they reflect the sum of ad spending that Free the Files volunteers have downloaded, rather than overall spending, and the application only covers several dozen major television markets and not all of the country. For markets not covered in Free the Files, you can go directly to the more cumbersome FCC website, and search by network or affiliate name.

For our story, we decided to examine the group Special OPS OPSEC Education Fund. OPSEC is a group of former special forces officers and CIA officers that has run ads in Virginia markets and on the web accusing President Obama of deliberately leaking national security information for political advantage. PolitiFact has evaluated three of its claims and found them Half True, Mostly False, and False, respectively.

2) Find out whether the sponsor is a nonprofit “social welfare” group

Now that we have the ad and its sponsor, we want to find out the nature of that sponsor. The simplest way to find out whether a group is a PAC, a super PAC, or a nonprofit is simply to Google the group. As ProPublica’s Justin Elliott explained, many groups will state on their website whether they are a nonprofit or a political action committee. The website may also refer to the group’s tax status: a 501(c)(4) organization is a social welfare nonprofit, a 501(c)(6) organization is nonprofit business or trade group, and any kind of committee is likely to be a PAC.

If the group’s website does not describe its tax status, then its filings to the Federal Election Commission will. Enter the name of the group into the FEC’s candidate and committee search form. If the group lists its contributors under a link to “Itemized Individual Contributions,” then it is a political action committee such as a super PAC. If the group only lists several expenditures without any information on its backers—or if it does not show up at all—then it is a “social welfare” nonprofit. For example, you can compare the FEC search results for the pro-Obama super PAC Priorities USA Action—which includes an “Itemized Individual Contributions” link and pie charts showing the group’s receipts and money spent—with the absence of results for its nonprofit sister, Priorities USA, to see the difference in the filings.

In the case of Special OPS OPSEC Education Fund, the procedure was straightforward: the group’s website identifies it at the bottom of the page as “a 501(c)(4) a social welfare organization.” When we looked it up on the FEC website, we did not find any records of expenditures. OPSEC does not list a telephone number on its website, and did not return our email inquiring about its tax status or whether it considered its activities to be political.

3) Find the group’s IRS filings

A few social welfare nonprofits did not apply for IRS recognition at all, a rare but legal course of action than can hamper an organization’s fundraising. But most do, and any group that does seek recognition as a social welfare nonprofit must file a publicly available IRS form called a 1024, which includes a questionnaire about its activities. The questions it must answer include: “Has the organization spent or does it plan to spend any money attempting to influence the selection, nomination, election or appointment to federal, state, or local public office or to an office in a political organization?”

ProPublica’s Kim Barker said that answering “yes” to political activity was believed to raise a yellow flag with the IRS that significantly slowed a group’s recognition as a tax-exempt nonprofit. As a result, ProPublica found, a number of groups answered this question “no,” and then went on to purchase political advertising anyway. “You’re committing perjury if you know at the time that you’re going to spend money on politics, and you fill out a form saying you’re not going to be doing that,” Barker said.

This summer, ProPublica created a dark money database which included every nonprofit group that it could find that was spending money on political ads. It has been updated.

The easiest way to find out if a particular nonprofit has been honest in its IRS filings is to look it up in ProPublica’s database, and examine the column that shows its answer to the question of whether its engages in political activity. This answer can then be compared to the spending the group reported in their 2010 tax returns—listed in the adjacent column of the ProPublica database—to determine whether they abided by their pledge or instead, after obtaining tax-exempt recognition, went on to conduct and report political spending.

There are two other tests of whether the group has abided by its declarations about political activity: Go to its FEC files to see if it has reported any spending, and consider any advertisements that it currently or recently aired on television. The IRS standard for whether an advertisement is political, by the way, is a common sense evaluation of its content. Basically, “If it walks like a political ad and it talks like a political ad, then it’s a political ad,” Barker said.

One hitch: the continuing emergence of new nonprofits and the long lag time between the airing of a political ad and public disclosure means that many groups may not be included in ProPublica’s database. For these groups, it is necessary to request their 1024 form directly from the IRS. An IRS spokeswoman provided the following instruction: “You may request a copy of the [1024] Form from the IRS by FAXING a request that is prepared on your MEDIA LETTERHEAD to 1-513-263-5900, Attention: Group I: Media Liaison.”

The Special OPS OPSEC Education Fund, which just began airing ads this summer, is not included in ProPublica’s dark money database. So we faxed in a request for their 1024 forms on Tuesday, and are awaiting a response. Elliott of ProPublica, who employed this approach in his story last week about the misleading nonprofit in Ohio, said it took about two weeks for him to hear back from the IRS.

We hope to soon find out if the OPSEC Education Fund is abiding by campaign funding laws, and will let readers know. And if reporters around the country do similar stories about “social welfare” groups, CJR would love to see them.

Related stories:


The Ad Wars: How do we cover them?

The Ad Wars: Super PACs not super? Not so fast


The Ad Wars: The numbers don’t add up

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Sasha Chavkin covers political money and influence for CJR's United States Project, our politics and policy desk. He has written for ProPublica, the Center for Public Integrity, and The New York World. Follow him on Twitter @sashachavkin.