Like all of us, labor unions are obligated to accurately report income on annual tax returns. The money collected from assessment and collection of dues must be reported as income on a union’s tax return.

But unlike us, unions generally don’t have to pay taxes on their income. They are exempt from taxation because they serve a public purpose - improving the working conditions for their membership. Certain union expenditures, however, can be taxed because they are not strictly in line with traditional activities. For example, when a union uses general treasury revenue for political activities, the union must report and pay taxes on such expenditures.

Thus, when a union’s president, who is paid more than $400,000 a year, spends much of her time campaigning for the election of candidates for public office, expenses associated with this conduct are subject to taxation. When a union transfers hundreds of thousands of dollars in general treasury funds to a political action committee during an election year, that transfer is subject to taxation. And when a union pays for the fees incurred in hosting a political rally, those expenses are also taxable.

Last year, Landmark Legal Foundation uncovered evidence suggesting the American Federation of Teachers uses the income it receives from its members to fund its extensive political activities. The evidence includes hundreds of tweets from AFT President Randi Weingarten advocating the election of Joe Biden and the defeat of Donald Trump, AFT sponsorship of an “AFT Votes” bus tour, and tweets memorializing AFT voter mobilization for the election of Joe Biden.

AFT has failed to acknowledge the expenses for its bus tour or Weingarten’s travel to and from political rallies on its tax returns. This appears problematic, and Landmark Legal Foundation submitted a complaint to the Internal Revenue Service this week alleging that AFT had neglected to report and pay taxes on these political activities.

In response to Landmark Legal Foundation's allegations, AFT said that it conducts all its political activities through its PAC, called AFT Solidarity. But, according to AFT’s public records, the union doesn't appear to be telling the whole truth.

New research into AFT’s public disclosure reports shows more than $3 million in political expenditures made during the 2018 and 2020 election cycles that are not accounted for on AFT Solidarity’s disclosure reports. This includes contributions to political action committees, public relations firms that work to advance progressive candidates, and event management companies that specialize in organizing and supporting political rallies. It appears that the money used to finance these activities arose from the dues-paying union membership, not from AFT’s political action committee.

Yet according to its tax returns, AFT (a union with 1.72 million members and more than $200 million in revenues) doesn’t spend one penny of that revenue on political activities. How does this square with AFT’s seemingly ubiquitous political presence?

Union members, the public, and the IRS should ask a few simple questions: Does the AFT spend any of its general treasury funds on activities that support candidates for political office? If the answer is no, then where does the money to pay for political rallies, the salaries for high-level executives who campaign relentlessly for candidates, and contributions to political action committees come from?

The public disclosure reports seem to conflict with the facts on the ground. Is the AFT playing by the rules? And will the IRS cast aside its bias favoring left-wing groups and make a good faith effort to investigate?

Michael O’Neill is the vice president of legal affairs at Landmark Legal Foundation.