POLITICS
05/19/2013 11:40 am ET Updated May 20, 2013

Karl Rove Talks IRS Scandal, Compares His Group To NAACP

WASHINGTON -- Karl Rove on Sunday defended his group Crossroads GPS, a 501(c)4 non-profit organization, against charges that it improperly benefited from a tax exemption intended for social welfare organizations.

Rove said liberal organizations had first exploited the loophole, which has garnered attention in the wake of news the IRS scrutinized applications for tax-exempt status from small tea party groups.

"501(c)4s have been around for a long time and the Democrats and the left have used these for years to do some politics and a lot of social welfare," Rove said on "Fox News Sunday," listing the NAACP, the Sierra Club and Planned Parenthood as groups that serve a social welfare function and still engage in political activity. "You have to spend a majority of your money on social welfare and a minority of your resources on political activity."

Rove, a career political strategist, raised hundreds of millions of dollars during the 2012 election and spent them on political advertisements designed to influence the presidential and congressional races. Rove's Crossroads GPS is one of hundreds of essentially political organizations that receive tax-exempt status designed for "social welfare" groups.

While many have called for reforms to the law allowing such groups to receive tax breaks, Rove insisted that the exemption is justified, and that organizations that support the Democratic Party have been working the statute longer.

"What happened is the Democrats had this for decades, for literally decades, and no criticism at all. Then Republicans began in 2010 to say, wait a minute, if it's good enough for them, we'll duplicate that structure as well. Then suddenly we get what we get, which is a huge bunch of activity aimed at conservative groups."

The Bush administration probed the NAACP's tax-exempt status between 2004 and 2006, and ultimately allowed the group to maintain its classification.

Rove's organizations do not provide the counseling, legal assistance and other support functions that the NAACP provides on civil rights.

Federal agencies frequently target smaller players who may be abusing the system to avoid lengthy legal battles with more prominent companies or organizations. Sen. Robert Menendez (D-N.J.) on Sunday criticized the IRS for targeting small Tea Party groups while allowing bigger fish, like Rove's Crossroads GPS, to pass through with little scrutiny.

"It's outrageous that the IRS went after these small tea party groups when Karl Rove is out there saying that he wants to use these groups to change the outcome of the election," Sen. Robert Menendez (D-N.J.) said on ABC's "This Week."

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