By: Fern Sidman

Senator Tom Cotton, R-Ark., has formally called on the Internal Revenue Service (IRS) to revoke the nonprofit status of the Council on American-Islamic Relations (CAIR), citing what he describes as the group’s longstanding ties to extremist organizations including Hamas and the Muslim Brotherhood. In a letter on Tuesday to the IRS, Cotton framed his request as a matter of national security and public accountability, arguing that federal tax exemptions should not extend to organizations with connections to terrorist financing.

According to a report at Fox News Digital, Cotton underscored his position by pointing to CAIR’s identification as an unindicted co-conspirator in the federal government’s largest terrorism financing case: the prosecution of the Holy Land Foundation (HLF). That case, adjudicated more than a decade ago, resulted in multiple convictions and established that HLF and its associates funneled millions of dollars to Hamas, a U.S.-designated terrorist organization.

The Holy Land Foundation trial remains one of the most significant terrorism-financing prosecutions in U.S. history. As the report at Fox News Digital recalled, the Justice Department demonstrated that HLF, once the largest Muslim charity in America, and five of its senior leaders had collaborated with others to provide substantial financial and material support to Hamas. The government estimated that roughly $12.4 million had been transferred to the Iranian-backed terrorist group.

The case concluded with sweeping convictions: 10 counts of conspiracy to provide, and the actual provision of, material support to a designated foreign terrorist organization; 11 counts of conspiracy to provide, and the actual provision of, funds, goods, and services to a Specially Designated Terrorist; and 10 counts of conspiracy to commit, and the commission of, money laundering.

Within that framework, prosecutors identified CAIR as part of the Muslim Brotherhood’s Palestine Committee in the United States, a body alleged to have been created to advance Hamas’s interests domestically. Although CAIR sought to have its name removed from the list of unindicted co-conspirators, Fox News Digital reported that the organization’s efforts to clear its designation were ultimately unsuccessful.

In his letter, Cotton argued that tax-exempt status is not an entitlement but a discretionary benefit granted by the government. He emphasized that the IRS possesses broad authority to review whether an organization’s current activities align with the purposes for which its exemption was granted.

“Tax-exempt status is a privilege, not a right, and it should not subsidize organizations with links to terrorism,” Cotton wrote, as quoted by Fox News Digital. He added that nonprofit protections must never be used to shield groups whose activities or leadership rhetoric demonstrate alignment with violent extremist movements.

Cotton’s demand to the IRS comes amid heightened scrutiny of CAIR following controversial statements by its leaders in the wake of Hamas’s October 7, 2023, assault on Israel.

In response to Cotton’s demand, CAIR issued a statement to Fox News Digital categorically rejecting the senator’s claims. The organization described the accusations as being “based on debunked conspiracy theories” and compared Cotton’s initiative to the political excesses of the McCarthy era.

“We are an independent American civil rights organization that has spent over thirty years defending the Constitution, countering anti-Muslim bigotry, and opposing injustice here and abroad, including discrimination, hate crimes, terrorism, ethnic cleansing, and genocide,” CAIR said.

The group further insisted that it has consistently condemned acts of terrorism, including the October 7 attacks on Israeli civilians. “We specifically condemned the Oct. 7th attacks on civilians, just as we condemn the ongoing genocide in Gaza. This is called moral consistency. Senator Cotton should try it,” CAIR’s statement to Fox News Digital declared.

Despite CAIR’s insistence on its role as a civil rights organization, the former Biden administration distanced itself from the group after its executive director, Nihad Awad, appeared to express support for Hamas’s October 7 attacks. In November 2023, just weeks after the massacre, Awad said he was “happy to see” Palestinians “breaking the siege and throwing down the shackles of their own land.”

As the Fox News Digital report highlighted, Awad also suggested that the people of Gaza had “the right to self-defense” while denying Israel’s right to the same. Those remarks, widely circulated at the time, prompted swift condemnation from both the administration and Jewish advocacy organizations.

The New York Times reported that then-White House spokesperson Andrew Bates condemned Awad’s statements as “shocking, antisemitic” and said the administration “denounces them in the strongest terms.”

CAIR’s leaders have continued to face criticism for their rhetoric surrounding the Israel-Hamas conflict and related developments. According to the information provided in the Fox News Digital report, the Anti-Defamation League (ADL) recently condemned further remarks made by Awad in response to U.S. and Israeli strikes on Iranian nuclear sites. Awad suggested that “Netanyahu calls the shots. Trump pretends to be in charge,” a formulation the ADL said promoted conspiratorial and inflammatory narratives.

The ADL has also pointed to other troubling statements by CAIR leadership. For example, Hussam Ayloush, the executive director of CAIR’s Los Angeles chapter, once referred to Congress and the White House as “Israeli-occupied territories.” Such rhetoric, critics argue, undermines CAIR’s claim to be a mainstream civil rights organization and reinforces allegations of alignment with extremist views.

The IRS holds significant discretion in determining whether a nonprofit organization’s activities are consistent with its tax-exempt purpose. Federal tax law requires that such organizations operate exclusively for religious, charitable, educational, or other exempt purposes, and that they refrain from activities that substantially deviate from those purposes.

As the Fox News Digital report noted, Cotton’s letter frames the matter not as a political dispute but as a question of whether taxpayer dollars indirectly subsidize an organization whose leaders and history reveal concerning ties. If the IRS were to act on Cotton’s request, CAIR could lose its nonprofit designation, which would strip the organization of tax advantages and undermine its fundraising capabilities.

Cotton’s intervention reflects a wider national debate over the role of advocacy organizations and the standards by which nonprofit status is granted or revoked. In particular, the issue raises questions about where the line is drawn between protected political advocacy and activities that may constitute material support for groups designated as terrorist organizations by the U.S. government.

Cotton’s demand has the potential to set a precedent. Should the IRS take action, it could invite renewed scrutiny of other nonprofits whose rhetoric or affiliations have been challenged, as was observed in the Fox News Digital report. On the other hand, inaction could further inflame critics who argue that groups such as CAIR enjoy privileges that should not be extended given their past associations.

At present, the IRS has not publicly commented on Cotton’s letter. Historically, the agency has moved cautiously in matters involving politically sensitive organizations. However, given CAIR’s prominence and the highly public nature of the allegations, the issue is likely to remain in the spotlight in the months ahead.

For CAIR, the stakes are significant. Losing nonprofit status could curtail its operational capacity and damage its credibility among allies. For Cotton, the issue represents both a national security concern and a broader campaign to ensure that taxpayer-supported benefits are not extended to groups accused of undermining American interests.

Fox News Digital has reported that this is not the first time CAIR has faced calls for greater scrutiny, but Cotton’s appeal to the IRS represents a direct push for regulatory action rather than political condemnation. Whether the IRS will act remains uncertain, but the clash has once again placed CAIR’s contested reputation at the center of American debates over terrorism, civil rights, and the responsibilities of nonprofit entities.