Stacey Abrams-founded Nonprofit Faces Scrutiny Over Tax-Exempt Status

FIRST ON FOX: The House Ways & Means Committee Chairman, Jason Smith, R-Mo., is urging the Internal Revenue Service (IRS) to revoke the tax-exempt status of the nonprofit New Georgia Project, founded by former Georgia gubernatorial candidate Stacey Abrams. Smith’s appeal follows a hefty fine of $300,000 levied against the organization for violating state election laws, a penalty he described as "possibly the largest ethics fine ever issued in the United States."

The Georgia Ethics Commission unanimously concluded that the New Georgia Project failed to disclose over $4 million in campaign contributions and more than $3 million in expenditures, primarily during Abrams' unsuccessful 2018 gubernatorial campaign. Smith argues this constitutes a clear breach of the organization's 501(c)(3) tax-exempt status, which prohibits political campaign interventions.

"Under Internal Revenue Code Section 501(c)(3), organizations are strictly prohibited from participating in or intervening in any political campaign on behalf of or in opposition to any candidate for public office," Smith wrote in a letter to IRS Commissioner Melanie Krause. He further urged the IRS to "examine and revoke" the nonprofit’s status, asserting that the group had crossed the line by intervening in the 2018 election cycle.

The New Georgia Project, established by Abrams in 2013 to enhance voter registration in Georgia, has not been under her direct leadership since 2017. However, its affiliated group, the New Georgia Project Action Fund, which can endorse candidates, operates without the tax-exempt privileges of a 501(c)(3) organization. Smith insists that the parent organization’s activities during the 2018 elections breached federal rules governing tax-exempt entities.

Smith did acknowledge that nonprofits are permitted to engage in nonpartisan voter education activities such as public forums and voter guides. However, he claimed the New Georgia Project’s actions went beyond these boundaries, urging the IRS to prioritize this matter.

The situation has reignited discussions about the delicate balance between nonprofit advocacy and political neutrality. In response to the Ethics Commission’s ruling, New Georgia Project attorney Aria Branch said, "While we remain disappointed that the federal court ruling on the constitutionality of the Georgia Government Transparency and Campaign Finance Act was overturned on procedural grounds, we accept this outcome and are eager to turn the page on activities that took place more than five years ago."

Fox News Digital reached out to both the New Georgia Project and the IRS for comments, but no responses were received by press time.