The Department of Justice announced on Thursday that it has settled its final lawsuit with a pro-Israel group that was targeted by the Internal Revenue Service during the Obama administration.
The settlement on Thursday was with a pro-Israel nonprofit called Z Street, founded by Lori Lowenthal Marcus in 2009. In its lawsuit, Z Street contended that it had been unfairly targeted by the IRS due to its support for Israel, and in particular its alleged support for Jewish activity over the pre-1967 “Green Line.”
“Tax exemption eligibility should be based on whether an organization’s activities fulfill requirements of the law, not a group’s policy positions or the name chosen to reflect those views,” Principal Deputy Assistant Attorney General Zuckerman said in a statement. “The attorneys at the Department of Justice work hard to ensure that all Americans receive equal treatment under the law. Today’s settlement further illustrates this commitment.”
Z Street, a non-profit whose mission is to educate the public on Israel and the Middle East, was among several non-profits; the IRS under the Obama administration had unfairly targeted mainly those linked to the Tea Party movement, that claims it. In October 2017 the Justice Department entered into settlements with other Tea Party organizations to pay claims of each of the groups in the case.
In October, Attorney General Jeff Sessions said that the IRS’s past practice was “inappropriate” and “wrong.”
“It is improper for the IRS to single out groups for different treatment based on their names or ideological positions,” Sessions said.
Z Street’s Marcus told the Jewish Press that she was thrilled about the settlement after a nearly a seven-year long battle with the IRS.
“It is thrilling to actually wrestle the IRS to the ground and force it to admit Z Street was targeted because we support Israel and the right of Jews to live everywhere, and that the Obama administration’s IRS violated Z Street’s constitutional rights by discriminating against us,” she said.
While the group ultimately won its battle against the IRS, its lack of non-profit status prevented it from raising funds and effectively led to its operations being shut down.