(NEWS) Lawsuit Accuses IRS Of Screening Israel-Related Charities

"A hawkish pro-Israel activist group has filed a lawsuit alleging that the Internal Revenue Service is impeding or denying applications for tax-exempt status from nonprofit organizations that oppose the Obama administration’s Israel policies. But experts in nonprofit tax law say that the allegations seem far-fetched.

In a complaint filed in federal court in Pennsylvania on August 25, the group, called Z Street, alleged that an IRS agent told an attorney for the organization that delays in the processing of its application for tax-exemption were due to the case receiving extra scrutiny over whether it would oppose administration policy on Israel.

As the Forward reported in January, some argue that the 1983 U.S. Supreme Court decision in the case of Bob Jones University v. United States could be interpreted to deny nonprofit status to organizations that oppose established American foreign policy. The Bob Jones decision, which found that 'an institution seeking tax-exempt status must… not be contrary to established public policy,' was written to bar tax exempt groups from participating in racial discrimination."