Treasury Secretary Scott Bessent and the IRS could revoke the tax-free status of left-wing nonprofits such as George Soros’ Open Society Foundations, the Southern Poverty Law Center, and the Council on American-Islamic Relations, three sources familiar with the matter have told The Post.
It is part of a Trump-backed crackdown on “bogus” charities, and Treasury officials are drawing up a sweeping audit of outfits deemed to be using and abusing Uncle Sam’s tax code, the three people briefed on the Treasury Department’s internal policy deliberations said.
Bessent’s inner circle is drafting a blueprint that could ultimately strip non-compliant organizations of their 501(c)(3) status, according to two of the people familiar with the plans. The reviews could result in massive back payments and civil penalties, the same sources said.
The initiative leans in part on a 2025 executive order signed by President Donald Trump targeting nonprofits operating with a “substantial illegal purpose,” paving the way for the IRS to issue fines or even strip the tax-exempt status of charities allegedly tied to political violence, protests or radical ideologies.
Officials have also scrutinized a number of anti-corporate and labor-aligned advocacy groups that could end up on the blacklist, including the Private Equity Stakeholder Project, the anti-Amazon Athena Coalition, left-leaning watchdog MediaJustice, and the Strategic Organizing Center alongside its parent union, the SEIU, according to the three insiders briefed on the matter.
One of the sources warned that Treasury Department officials were “like a dog with a bone” and reckoned that many of the groups and their donors could be “on borrowed time.”
“There’s a lot of internal pressure to get it done, but some people are still moving too slowly at the IRS,” the source said. “That is expected to change very soon.”
The aggressive crackdown is already facing fierce legal blowback. Left-leaning legal powerhouse Protect Democracy sued Treasury and the IRS earlier this year, accusing the administration of illegally weaponizing the tax code against its political opponents.
The suit claims Bessent and the White House are bypassing strict federal tax laws to conduct a partisan witch hunt that violates the First Amendment rights of progressive charities.
While there is intense internal pressure from some administration officials to get “a good chunk of the crackdown” over the line before the midterms, others have argued for delaying formal enforcement until later in the term to avoid triggering massive, protracted legal battles, the three sources said.
There is a fear that adding high-profile domestic political targets like the SPLC and Soros’ network will trigger a wave of lawsuits, potentially stalling any momentum against foreign terror-linked groups like CAIR, these people told The Post.
The Treasury Department declined multiple requests to comment, but Bessent confirmed last October on the “Charlie Kirk Show” that work on compiling the hit list had begun.
Formally stripping a group of its 501(c)(3) status is a notoriously sluggish process that can take years, involving protracted IRS audits, internal administrative appeals, and inevitable battles in federal tax court.
To help with the review of nonprofits, Bessent enlisted Tony Saffier, a former special operations veteran and AI executive recently tapped to spearhead the interagency task force.
Penalties under consideration range from corrective fines to the ultimate regulatory sanction: full revocation of tax-exempt status, which would force the nonprofits to pay the standard 21% federal corporate tax rate.
A Post analysis of the latest IRS filings for all three organizations shows they would have owed about $165 million in federal income tax for 2024 if taxed at that 21% rate.
Almost all of it comes from a single source: the Soros network accounts for $163.6 million of the total. The SPLC would owe roughly $354,000, and 17 CAIR chapters would owe about $860,000 between them. That combined total amounts to a mere rounding error for the US government’s coffers.
The targets face unique controversies that the administration is leveraging to justify the crackdown.
Now chaired by George Soros’ 40-year-old son, Alexander, the Open Society Foundations funnels billions to NGOs pushing diversity initiatives, bankrolling climate-change lawsuits, and supporting undocumented migrants.
A spokesperson for the Soros nonprofit told The Post: “Threatening any nonprofit’s tax status for political reasons would be nothing more than an illegal attempt to target and stifle work that the administration disagrees with.”
Bessent is eyeing Soros’ charity despite famously spearheading global currency bets for the Hungarian-born billionaire—including a wildly lucrative wager against the British pound.
When Bessent stepped down as chief investment officer for Soros Fund Management in 2015, Soros staked his new firm with a cool $2 billion.
OSF’s beneficiaries include Black Lives Matter, the US Campaign for Palestinian Rights, and United We Dream Action, a group that actively works to frustrate the deportation of illegal migrants.
The Southern Poverty Law Center is reeling from the recent federal indictment of its former intelligence director. While OSF and SPLC are being scrutinized under the president’s domestic executive order, the administration is treating CAIR strictly as a national security target.
Prosecutors allege the self-described anti-racism outfit secretly funneled donor funds to extremist informants, including an operative who allegedly helped organize the violent 2017 Charlottesville rally.
Meanwhile, the Council on American-Islamic Relations has long faced scrutiny over alleged foreign entanglements.
Federal prosecutors named the group as an unindicted co-conspirator in the 2007 Holy Land Foundation terror-financing trial. CAIR adamantly denies any ties to illicit foreign funding or terror organizations.
CAIR and the SPLC did not respond to The Post’s requests for comment.
Samuel Handwerger, a tax policy professor at the University of Maryland, says the fear of losing an exemption misses the larger picture.
“If I were assessing real-world exposure for these organizations, I would rank it: bank de-risking first, donor and grantmaker chill second, examination costs third, and actual revocation a distant fourth,” the certified forensic accountant said.
The tax expert warned that expanding executive power to target specific groups sets a dangerous precedent.
“Every administration inherits the precedents of the last one. Organizations across the political spectrum have an interest in the answer (to this question), and many of them have not yet noticed that,” he told The Post.