Hey this is Debra Marie The Tax Queen coming back atcha. There has been a lot of discussion regarding the dissolution of the NRA due to Fraud and even having a lawsuit against them by Attorney General Letitia James. So, in this post, we will be discussing why the NRA may be finished and what may be the cause of their demise.
So, let’s get started!
So, New York Attorney General Letitia James Moves To Dissolve The NRA After Fraud Investigation.
The attorney general of New York acted Thursday to dissolve the National Rifle Association following an 18-month investigation that found evidence the powerful gun rights group is “fraught with fraud and abuse.”
Attorney General Letitia James claims in a lawsuit filed Thursday, August 6, that she found financial misconduct in the millions of dollars and that it contributed to a loss of more than $64 million over a three-year period.
The suit alleges that top NRA executives misused charitable funds for personal gain, awarded contracts to friends and family members, and provided contracts to former employees to ensure loyalty. The New York Attorney General is alleging that senior leaders of the non-profit group wasted millions of dollars of members’ money on their own luxury travel, personal gifts from retailers like Neiman Marcus and Bergdorf Goodman, family vacations to the Bahamas and big game hunts in Africa. Ms. James said that the four named defendants – Mr. LaPierre, Wilson Phillips, Joshua Powell and John Frazer – “instituted a culture of self-dealing, mismanagement and negligent oversight at the NRA that was illegal, oppressive and fraudulent”.
Seeking to dissolve the NRA is the most aggressive sanction James could have sought against the not-for-profit organization, which James has jurisdiction over because it is registered in New York. James has a wide range of authorities relating to nonprofits in the state, including the authority to force organizations to cease operations or dissolve. The NRA is all but certain to contest it.
The NRA said in a statement that the legal action was political, calling it a “baseless premeditated attack on our organization and the Second Amendment freedoms it fights to defend… we not only will not shrink from this fight – we will confront it and prevail.”
Now let’s get this straight. The NRA does not represent the 2nd amendment they represent gun manufactures. So, if you think this is an attack on the 2nd amendment you are 100% mistaken.
Within the NRA’s 5 million members are dissidents who have been clamoring for reform for years, only to be defeated as NRA leadership and its 76-member board of directors closed ranks behind Executive Vice-President Wayne LaPierre. In depositions cited by the lawsuit, LaPierre does not deny the expenditures but justifies them as legitimate expenses.
“I’ve been trying to wake people up for years as to the corruption,” said Tim Harmsen, a lifetime NRA member and host of the Military Arms Channel online. He goes on to say “The NRA is broken on the inside. It needs new leadership. Wayne has to go. It’s almost as if he’s purposely trying to run the organization into the ground.”
Ms. James alleges that the gun lobby is rife with corruption and no longer has the right to call itself a non-profit charity.
Let me explain in a short and simple way of how a nonprofit should work so that you can understand why the NRA may be dissolved like any nonprofit who does not go by the guidelines of having a charity. There are six areas where ethical issues arise in the nonprofit sector: compensation; conflicts of interest; publications and solicitation; financial integrity; investment policies; and accountability and strategic management.
According to National Council of Nonprofits, when people join a nonprofit board of directors, they agree to conduct prudent use of assets, make decisions in the best interest of the organization, and ensure that the organization abides by applicable laws and acts ethically.
Is the NRA a charity? I thought that charities could not be involved in politics. Well, the answer to that question is that The National Rifle Association (NRA) is not a charity in the same way that, say, Red Cross and United Way are charities. They are, however, both tax-exempt organizations.
The NRA is not a section 501(c)(3) organization. Rather, it is organized as a section 501(c)(4) organization. Those are described in the Tax Code as civic leagues or organizations not organized for profit but operated exclusively for the promotion of social welfare, or local associations of employees, the membership of which is limited to the employees of a designated person or persons in a particular municipality, and the net earnings of which are devoted exclusively to charitable, educational, or recreational purposes.”
Like section 501(c)(3) organizations, section 501(c)(4) organizations are tax-exempt for federal income tax purposes. But payroll, sales, real estate, and other taxes may still apply.
However, there is one significant difference: Section 501(c)(4) organizations may engage in lobbying so long as it pertains to the organization’s mission. The trade-off, as you might have guessed, is that donations made to 501(c)(4) organizations are typically not deductible by the donor as charitable contributions for federal income tax purposes.
So now that we got that out of the way. Is the NRA a Charity? You can now see the reason behind the decision of New York Attorney General Letitia James. It has nothing to do politically and it is not an attack on the organization and the Second Amendment freedoms it fights to defend. It is solely being done to protect the members and the taxpayers from fraud of mishandled funds.
Now you didn’t think I’d end this podcast without mentioning our president Donald Trump, did you? PRESIDENT DONALD TRUMP on Thursday called New York’s lawsuit against the National Rifle Association “a very terrible thing” and suggested the organization move to Texas and lead a very good and beautiful life,” calling the state “an appropriate place” for the NRA.
Now what he said makes no sense whatsoever, because no matter where they move it is still illegal and unethical to do what the leadership is doing and have been doing for years within the NRA.
So, there you have it folks. A breakdown of the Lawsuit against the NRA aka the National Rifle Association.