ACORN: Tax Cheats

ACORN CEO Bertha Lewis told Fox News Sunday on September 20 that her group “absolutely pays its taxes.” But her claim crumbles before the $548,213.25 federal tax lien that the Internal Revenue Service filed against the embattled New Orleans-based activist organization. Louisiana state tax officials also have slapped $334,121.43 in tax liens on ACORN since last October 29.

The Association of Community Organizations for Reform Now has been in boiling water lately for far sexier charges. Conservative filmmakers James O’Keefe, 25, and Hannah Giles, 20, posed, respectively, as a pimp and prostitute. Then, on hidden camera, they captured ACORN staffers from Brooklyn to Baltimore to San Bernardino advising them how to open a brothel and staff it with smuggled, underage illegal aliens. (The culprits on ACORN’s staff have been sacked.) Evidence that ACORN ignored its tax obligations may be less exciting than bordellos and voter-registration fraud, for the latter of which some ACORN workers have been convicted. However, these tax documents show that ACORN is not just rotten at its eastern and western edges. The group’s lawlessness begins at its Big Easy national headquarters. (Oddly enough, ACORN also counts New York and Washington, D.C. among its three HQs.)

Another New Orleans organization, the free-market Pelican Institute for Public Policy, uncovered official records that confirm ACORN’s deadbeat tax status. (Full disclosure: the Pelican Institute hosted my visit to the Crescent City last May.) Pelican researcher Steve Beatty visited the Orleans Parish Clerk of Courts office. There he found a September 3 IRS filing showing that “Elysian Fields Corporation, Inc., Alter Ego of” ACORN skipped five Social Security and Medicare tax payments between third quarter 2005 and first quarter 2008. ACORN made no federal unemployment-tax payments for the fourth quarters of 2007 and 2008.

“We have made a demand for payment of this liability, but it remains unpaid,” reads IRS form 668(Y). The IRS consequently has placed liens on ACORN’s New Orleans offices at 2609 Canal Street and 2610 Iberville Street. This latest federal action follows the $1 million invoice that the IRS already handed ACORN, as Pelican reported last August.

As if its federal woes were insufficient, ACORN is in big trouble with Baton Rouge, too.

“We have a full-scale investigation into ACORN and all of its subsidiaries,” Tammi Arender, spokesman for Louisiana Attorney General Bobby Caldwell recently stated. “No stone will be left unturned. We’re still looking into their recent activities.” Caldwell subpoenaed ACORN, former ACORN head Wade Rathke, and the group’s financial institution, Whitney Bank. Caldwell seeks information stretching back to 1998 on ACORN and some 361 tax-exempt and non-tax-exempt outfits in its universe.

The Pelican State’s chief prosecutor should peruse the Louisiana Workforce Commission’s July 2 notice indicating that ACORN dodged state unemployment insurance payments for all four quarters of 2008 totaling $1,382.69.

The Louisiana Department of Revenue last November 24 alerted ACORN that it owed $26,036.01 for nine state-withholding-tax payments that it failed to pay between June 30, 2007 and May 31, 2008.

Citizens Consulting, Inc. — ACORN’s bookkeeping arm, no less — scored a “Notice of State Tax Assessment and Lien” on October 29, 2008. It details 66 withholding-tax payments that Citizens Consulting skipped between December 31, 2002 and June 30, 2008. Total: $306,702.73.

These documents are online at

This news is doubly insulting to American taxpayers. First, they often struggle to pay their taxes fully and on time. While rarely easy, most Americans somehow manage to do this. ACORN routinely blew off this duty.

Second, since 1989, at least 53 million hard-earned dollars have flowed from the checkbooks of law-abiding taxpayers, via Washington, into the coffers of ACORN and its activist groups. ACORN, in turn, stiffs its workers by failing to pay for their Social Security and Medicare benefits. One expects better from self-styled “progressives.”

(ACORN spokesman Scott Levenson did not reply to repeated requests for comment.)

“Frankly, it’s not really something I’ve followed closely,” President Obama told ABC’s George Stephanopoulos on September 20’s “This Week.” “I didn’t even know that ACORN was getting a whole lot of federal money,” Obama added. “This is not the biggest issue facing the country. It’s not something I’m paying a lot of attention to.”

Obama, however, was far more attentive to ACORN while running for president.

“I’ve been fighting alongside ACORN on issues you care about my entire career…even before I was an elected official,” stated Obama — ACORN’s one-time attorney — on his campaign website in November 2007. “When I ran the Project Vote voter-registration drive in Illinois, ACORN was smack dab in the middle of it, and we appreciate your work.”

ACORN certainly has not felt appreciated lately. In overwhelming numbers, the Senate and House correctly voted last week to strip ACORN’s federal funding. Given ACORN’s history of corruption and illegal support of Democratic political candidates, Congress should go farther and yank the tax-exempt status of ACORN and its subsidiaries. If ACORN insists on being the criminal arm of the Democratic Party and the Left-liberal movement, it should do so with private money, not with direct federal outlays or indirect federal tax subsidies.