EXCLUSIVE — Rep. Jason Smith (R-MO), chairman of the congressional committee that oversees the IRS, is demanding the agency strip a progressive nonprofit organization of its tax-exempt status after the Treasury Department determined in October that one of its subsidiaries is a terrorist front group.
The Popular Front for the Liberation of Palestine, a U.S.-designated terrorist organization, uses Samidoun, which is housed within the Alliance for Global Justice through a fiscal sponsorship agreement, as a vehicle to fundraise in North America and Europe, according to the Treasury Department. Smith, as chairman of the House Ways and Means Committee, sent a letter to the IRS on Wednesday morning arguing that this kind of proximity to foreign terrorists should disqualify the AFGJ from receiving tax-exemption benefits in the United States.
“This case is not complicated, which makes the failure to revoke the Alliance’s tax-exempt status both concerning and confusing,” the letter reads. ”As you know, if a nonprofit organization conducts substantial activities that do not further its exempt purposes, such activity may result in the loss of the organization’s tax exempt status. Additionally, the IRS has found that conducting illegal activity is inconsistent with tax exemption. … Given Samidoun’s designation by the Treasury as a terrorist organization, coupled with the fact that the Alliance fiscally sponsors and provides support for Samidoun, the IRS must revoke the Alliance’s tax-exempt status immediately.”
The PFLP has ordered suicide bombings, hijacked planes, and shot rockets at civilians, according to the U.S. Office of the Director of National Intelligence.
Smith noted in his letter that he previously asked the IRS to strip the AFGJ of its tax-exempt status, alongside other nonprofit organizations involved in pro-Hamas demonstrations following the Oct. 7, 2023, terrorist attacks in Israel.
Fiscal sponsorship is an arrangement that enables an established nonprofit organization, such as the AFGJ, to confer tax-exempt status to an allied group, according to the American Bar Association. The agreement allowed Samidoun to operate as a tax-exempt organization and process tax-deductible donations without having to register independently with the IRS.
The Washington Examiner previously reported that the AFGJ fundraised for Collectif Palestine Vaincra, a France-based organization that is openly partnered with the PFLP. Collectif Palestine Vaincra also counts itself as a member of Samidoun’s coalition. Prior to the Treasury Department’s announcement, a number of watchdog groups and Israel had flagged Samidoun, and, by extension, the AFGJ, as having links to terrorists.
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“Organizations like Samidoun masquerade as charitable actors that claim to provide humanitarian support to those in need, yet in reality divert funds for much-needed assistance to support terrorist groups,” acting Undersecretary of the Treasury for Terrorism and Financial Intelligence Bradley T. Smith said in October. “The United States, together with Canada and our like-minded partners, will continue to disrupt those who seek to finance the PFLP, Hamas, and other terrorist organizations.”
Major left-of-center charities such as the Soros family’s Open Society Foundations and those managed by Arabella Advisors have poured millions into the AFGJ over the years, including nearly $20 million since 2020 alone. As a result of the Treasury Department’s findings, all transactions between U.S. persons and Samidoun are now prohibited.
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“The Alliance for Global Justice has not only supported illegal activity in the United States, but they have now been caught red-handed funding the terrorist-linked Samidoun group whom the Treasury Department has deemed a ‘sham’ organization,” Smith told the Washington Examiner. “These facts can no longer be ignored. American taxpayers should not be forced to subsidize terrorist activity. The IRS must act to revoke the organization’s tax-exempt status immediately.”
The AFGJ and the IRS did not respond to the Washington Examiner’s requests for comment.