ZOA's Uncertain Status

Zionist Group Argues Over Publicizing Loss of Tax Exemption

Gala Dinner: Morton Klein chats with Glenn Beck and Rep. Michele Bachmann at the Zionist Organization of America’s 2011 dinner.
naomi zeveloff
Gala Dinner: Morton Klein chats with Glenn Beck and Rep. Michele Bachmann at the Zionist Organization of America’s 2011 dinner.

By Josh Nathan-Kazis

Published September 11, 2012, issue of September 21, 2012.

The Zionist Organization of America’s tax-exempt status has been revoked after the group missed three consecutive years of filings to the Internal Revenue Service, the Forward has learned.

The 115-year-old Zionist group has not been allowed to accept tax-deductible donations since February.

Read new Forward story about questions over ZOA

ZOA spokesman David Drimer, the group’s executive director, said that the sanction was the result of a “technical misunderstanding,” and that since it happened, the ZOA has “never intentionally” misrepresented itself . He said that the group is nearly ready to apply for a retroactive reinstatement of its tax exemption.

In an email provided to the Forward, ZOA tax attorney Tyler Korn wrote that “serious failures by the ZOA’s accountants, management and Board” led to the loss of the group’s exemption.

Drimer, who previously was associate publisher of the Forward, said that the lost exemption is no secret and that he talked “with numerous individuals about it every day.” But Drimer cited a memorandum prepared by Korn saying that the group has no obligation to broadly publicize the sanction.

That opposition to publicizing the lost exemption has been a cause of dissent on the group’s national board. Steven Goldberg, a vice chairman of the national board and the chair the ZOA’s Los Angeles chapter, has argued for broader public disclosure.

“I believe we have a fiduciary responsibility to disclose,” Goldberg told the Forward. “I don’t understand not telling people.”

The ZOA’s national board is set to meet at the organization’s offices today to discuss the issue.

An institution with roots in the beginning of the Zionist movement in America, the ZOA is now to the right of the American Jewish political spectrum. Former Fox News host Glenn Beck addressed the group’s annual dinner last November, as did Tea Party favorite Michele Bachmann. National president Morton Klein has led the ZOA for the past 18 years.

“Our tax attorney has told us he has every confidence we will shortly be reinstated,” Klein told the Forward.

The ZOA’s current trouble with the IRS began in May of 2011, when the organization missed the filing deadline for its 2008 Form 990s, the tax documents that the IRS requires exempt groups to file annually.

The ZOA, like many other exempt groups, habitually runs a few years behind in filings its 990s. Groups are not allowed to run three years late, however, and the missed 2008 filing made the ZOA three years delinquent.

According to Drimer, the missed deadline was due to a misunderstanding on the part of ZOA management and the group’s outside auditors. The 2008 990s were filed in November 2011, when the group believed them to be due. The IRS informed the group in February 2012 that the deadline had been in May 2011, and that the ZOA’s exempt status had been automatically revoked.



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