WASHINGTON (CNN) -- Documents set to be released this week by the IRS watchdog show that the agency targeted tea party organizations and other groups focused on government spending and the federal debt that were seeking tax-exempt status.
The IRS also applied extra scrutiny to applicants with statements that "criticize how the country is run" or that sought to educate the public on how to "make America a better place to live," designations that would have included conservative political groups looking to apply for 501(c)(4) status.
Those disclosures are included in the appendix of an inspector general's report, obtained by CNN, that has caused widespread anger among lawmakers on both sides of the aisle as well as conservative groups.
So, what's a 501(c)(4)?
A "501(c)(4)" organization is tax-exempt under section 501(c)(4) of the tax code if it meets two criteria: the "organization must not be organized for profit and must be operated exclusively to promote social welfare."
To meet the IRS social welfare requirements, "an organization must operate primarily to further the common good and general welfare of the people of the community," The IRS further defines this critical criterion under section 501(c)(4) as "primarily for the purpose of bringing about civic betterment and social improvements."
But the IRS has said that "the promotion of social welfare does not include direct or indirect participation or intervention in political campaigns on behalf of or in opposition to any candidate for public office." That said, "a section 501(c)(4) social welfare organization may engage in some political activities, so long as that is not its primary activity." And, according to the IRS, a 501(c)(4) may also engage in lobbying.
For example, guidance from the IRS available online suggests that an organization is likely to be deemed tax-exempt under section 501(c)(4) if its educational activities are conducted in a non-partisan manner and if the organization is not affiliated with a political party -- even though the organization's philosophy on the issues it is providing education about is broadly consistent with the view of a major political party.
The same guidance also points to past rulings by the IRS that allowed tax-exempt status under section 501(c)(4) for "organizations primarily engaged in advocating a particular point of view on an issue of public concern, through lobbying and public education."
The same guidance points out that an organization exempt under section 501(c)(4) "may engage in political campaign activities if those activities are not the organization's primary activity."