Your Donations To Progress NC Are Tax Exempt… Except When They’re Not. (UPDATES)

It appears that possibly Progress NC hasn’t been following the law with regards to donations made to the organization. The general gist here is that Progress NC apparently did not renew its solicitation license for non tax exempt status around mid-May of this year, yet has been receiving donations under the pretext the organization was compliant. If true, who knows how many donors have been affected as the Progress NC website still claims donations made to them to be tax exempt. Progress NC’s donation page says the same. NC Republican Party Chairman Claude Pope has called on NC Secretary of State Elaine Marshall to investigate.

From NCGOP:

Raleigh, NC – Progress North Carolina (Progress NC) has been asking for money under the pretense of being a federal tax exempt non-profit organization.  But, the truth is, Progress NC does not have a non-profit federal tax exempt status.

“Progress NC doesn’t pay taxes because they claim to be a tax exempt organization.  The problem is, they have not been granted federal tax exempt status,” said Chairman Claude Pope. “Maybe they qualify for the exempt status and maybe they don’t.  But the law is the law and they are not following the law.  As such, I am calling on Secretary of State Elaine Marshall to conduct a full investigation into Progress NC’s questionable fundraising practices and efforts to avoid paying taxes.  I think we can all agree that NC has been embarrassed enough by shady fundraising practices over the past decade that folks were willing to simply laugh it off.”

* Progress NC has duped their donors into thinking that their donations are tax deductible and they should immediately cease and desist their operations.

* All donations received while operating under an expired license should be returned.

Duped might be putting it mildly. If these allegations are accurate and Progress NC knowingly proceeded, there are potential fraud issues to contend with.  The press release gives more detail as to the expiration of Progress NC’s paperwork as being May 15, 2013 and that Progress NC has failed to disclose their status to donors. From the release, emphasis added:

On March 7, 2013, Progress North Carolina submitted a charitable solicitation license with the North Carolina Department of the Secretary of State. On March 11, 2013 the Secretary of State Charitable Licensing Office granted Progress NC a solicitation license. The license expired on May 15, 2013 and has not been renewed.

On the charitable solicitation license application, question 15 states: “Has applicant received a federal tax exemption determination letter?” Progress North Carolina marked their response as “No.” Therefore, the Secretary of State Solicitation Licensing office licensed Progress NC as a “Non Tax Exempt Entity.”  The North Carolina Administrative Code (18 NCAC 11.0305(e)) calls for Non Tax Exempt charitable organization or sponsor to provide disclosure in its solicitations that the charitable organization or sponsor is a “Non Tax Exempt Entity” and that donations are not tax deductible. Progress NC has failed to do either and, to the contrary, illegally advertises that donations are tax deductible.

Details of the Progress NC filing information here.

Link to the Progress NC profile at NC Secretary of State here with overview here. Update: The second link to the overview seems to have been altered at some point since this article posted. The refreshed link is here.  There seems to be additional filing information dated 9/16/13 in the document filings:

Open the Image 9/16/2013 10:00:00 AM L201325900001 Renewal Charity

Looks like quite a flurry of activity there and a folder dated before the NCGOP article. Somebody find an application behind a file cabinet or something?

It is worth noting that former reporter and now liberal activist, Gerrick Brenner, is listed as the contact and Executive Director/CFO and that Progress NC is a noted partner of Blueprint NC – the group who circulated an attack memo calling for the evisceration of state leaders, specifically Pat McCrory.

Flashback to 2012: Who pays Progress NC?

Gerrick Brenner tried to pull the ‘show me your tax returns’ dance on McCrory that Obama was trying to pull on Romney. It backfired and calls for Progress NC and Progress Action’s paperwork to be made available instead. Brenner complied in 2012, but it looks like 2013 may now be a different story.  WRAL, emphasis added:

And conservatives backing McCrory have quietly suggested that more should be known about Progress NC, a 501(c)3, and Progress Action, a 501(c)4.

At WRAL-TV’s request, Gerrick Brenner, the executive director for both groups, sent along the IRS form 990 for both group. The 2011 form, the latest available, gives rough outline of their budgets and operations.

But neither the 990 for the 501(c)3, which cannot directly advocate in a political campaign, or the 501(c)4, which is allowed to speak more directly about candidates and issues, lists donors for the group.

We follow the rules of the road and the letter of the law, which are ultimately set by Congress,” Brenner said. Neither group is required to disclose its donors. We asked him if he would voluntarily give a list of donors or top donors for either organization.

“We have donors of all shapes and sizes all across the state, who share progressive values about the value of funding our public universities and public schools, and smart investments like Research Triangle Park,” Brenner said. But he declined to list specific donors.

More about the Blueprint NC Connection

Blueprint NC was created by NC Justice Center and initially driven by former NC Justice Center employee, Julie Mooney.  Money was funneled from NC Justice Center for Blueprint NC for its start-up; likely some of which came from the Z. Smith Reynolds Foundation.  Later in the incubation, much larger sums were directly sent to Blueprint NC from the Z. Smith Reynolds Foundation (Also from AJ Fletcher Foundation – the charitable organization run by WRAL/Capital Broadcasting owner Jim Goodmon).

More on this backstory and Progress NC connection to Blueprint NC to come.

About A.P. Dillon

A.P. Dillon is a freelance journalist and is currently writing at The North State Journal. She resides in the Triangle area of North Carolina. Find her on Twitter: @APDillon_
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2 Responses to Your Donations To Progress NC Are Tax Exempt… Except When They’re Not. (UPDATES)

  1. Pingback: Your Donations To Progress NC Are Tax Exempt… Except When They’re Not. | Grumpy Opinions

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