Center for the Defense of Free Enterprise
12500 N.E. 10th Place Bellevue, WA 98005 425-455-5038 fax 425-451-3959

May 1, 2002

Commissioner Charles O. Rossotti
Commissioner of Internal Revenue Service
1111 Constitution Avenue, NW
Washington, DC 20224

Re: People for the Ethical Treatment of Animals, Inc.

Dear Commissioner Rossotti:

This is to amend and add to our letter of complaint of March 2, 2002, concerning violations of U.S. tax laws by the People for the Ethical Treatment of Animals ("PETA"), an I.R.C. 501(c)(3) tax-exempt charitable organization based in Norfolk, Virginia. That letter is incorporated by reference to this complaint.

We have discovered irregularities in reporting grants and allocations by PETA that reinforce our request to revoke recognition of PETA’s tax-exempt status under I.R.C. Section 501(c)(3):

  • PETA failed to provide a schedule of its grants and allocations to other organizations in addition to the totals in Part III of the Form 990, for the fiscal year ending July 31, 1998; and
  • PETA failed to provide a schedule of its grants and allocations to other organizations in addition to the totals in Part III of the Form 990, for the fiscal year ending July 31, 1997.

    • Based on examination of PETA’s Form 990 annual reports for those two fiscal years, we find that the public inspection copy now on file with the IRS contains no detailed accounting for nearly one million dollars of PETA funds in grants and allocations to other groups. No schedule of grants and allocations was attached containing any list of any grant amount, any recipient, and any purpose. There is no evidence that such a schedule was ever filed with the IRS for either of the two fiscal years in question. PETA, however, did attach such a schedule to its Form 990 for the fiscal years before and after the two fiscal years in question. This irregularity in reporting prompted this complaint.

    Given PETA’s grant to an FBI-declared domestic terrorist group, the North American Earth Liberation Front, reported on its fiscal year 2001 Form 990 "Schedule of Grants and Allocations," it is a matter of public concern who received PETA grants and allocations, how much they received and why they received it. It is a legitimate question to ask whether PETA gave grants to any FBI-declared domestic terrorist group during the fiscal years ending July 31, 1997 and July 31, 1998.

    Commissioner Rossotti, we urge you to incorporate this complaint into any investigation of PETA’s activities, and we urge the IRS to revoke PETA’s status as a tax-exempt organization.

    Sincerely,

    (Signed)

    Ron Arnold
    Executive Vice President

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