Politico, Pro-Israel Group Claims IRS Persecution:

A hawkish pro-Israel group today filed a lawsuit against the Commissioner of the IRS containing the explosive allegation that the IRS is devoting special scrutiny to pro-Israel groups whose policies conflict with that of the administration.

The group Z Street, intended as a conservative Zionist answer to the liberal J Street, says in its complaint that its counsel was informed that its status as a tax-exempt group was delayed, and could be denied, because of that scrutiny.

Agent Diane Gentry told the group's lawyer that the IRS is "carefully scrutinizing organizations that are in any way connected with Israel," the complaint, filed in federal district court in Pennsylvania, says. "Agent Gentry further stated to counsel for Z STREET: 'these cases are being sent to a special unit in the D.C. office to determine whether the organization's activities contradict the Administration's public policies.'"

The Jewish Daily Forward, Lawsuit Accuses IRS of Screening Israel-Related Charities:

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.

Legal experts were split on the question of longstanding foreign policy, such as America’s opposition to Jewish settlements in the West Bank, could fall within the realm of “public policy” as described in Bob Jones. All agreed, however, that the IRS had never used Bob Jones to deny tax-exempt status to nonprofits that oppose American foreign policy.

The Weekly Standard, Is the IRS Discriminating Against a Pro-Israel Group?:

Z Street was told by an IRS agent that it might not be granted 501(c)(3) status, which would allow the group to be tax exempt, because its position toward Israel differs from the Obama administration's official policies. Z Street alleges that this is unconstitutional:

These statements by an IRS official that the IRS maintains special policies (hereinafter the “Israel Special Policy”) governing applications for tax-exempt status by organizations which deal with Israel, and which requires particularly intense scrutiny of such applications and an enhanced risk of denial if made by organizations which espouse or support positions inconsistent with the Obama administration’s Israel policies, constitute an explicit admission of the crudest form of viewpoint discrimination, and one which is both totally un-American and flatly unconstitutional under the First Amendment.