House lawmakers are urging the Treasury Department and the IRS to investigate U.S. nonprofits they say may have been used by the Chinese Communist Party to shape American politics and elections. The request centers on “hometown” associations, community groups created by immigrants from the same Chinese towns or provinces to build social ties, welcome newcomers, and preserve cultural links.
House Select Committee on the Chinese Communist Party Chairman John Moolenaar and House Ways and Means Chairman Jason Smith sent a letter to Treasury Secretary Scott Bessent and IRS Commissioner-designate Frank Bisignano expressing what they called grave concerns about these groups’ nonprofit status. The lawmakers said some of the organizations may be part of Beijing’s broader United Front influence strategy, which congressional researchers have described as a mix of outreach, pressure, and intelligence-related activity.
What lawmakers say is happening
The lawmakers said some groups that began as cultural and charitable associations now appear to be politicized. They argued that Chinese state-linked interests may be using tax-exempt entities to influence local communities, support favored candidates, and silence critics of Beijing.
Their letter cited reporting that found at least 53 organizations endorsed or raised money for political candidates, with at least 19 allegedly in clear violation of federal rules. Under U.S. tax law, most 501(c)(3) nonprofits cannot participate in political campaigns or support candidates for or against public office.
Key concerns raised in the letter
- Possible campaign activity by tax-exempt groups.
- Pressure on community members critical of Beijing.
- Links between nonprofit networks and China’s United Front system.
- Potential overlap with foreign influence and intelligence activity.
- Possible abuse of U.S. tax rules meant to protect nonprofit status.
Moolenaar and Smith said some organizations may operate as intermediaries for Chinese state interests while presenting themselves as ordinary diaspora groups. They warned that such activity could undermine democratic institutions and distort political participation at the local level.
Existing investigations add pressure
The lawmakers pointed to prior federal investigations involving Chinese diaspora organizations, including the FBI’s probe into the American Changle Association in New York City. Authorities alleged the site housed an illegal “secret police station” tied to China’s Ministry of Public Security, and two people were arrested on foreign-agent related charges.
One of those defendants, Chen Jinping, pleaded guilty to conspiring to act as an illegal agent of the People’s Republic of China. The other case remains in court, according to the information cited by the lawmakers.
The issue also follows a separate House hearing on foreign influence in the nonprofit sector. That hearing examined networks tied to tech tycoon Neville Roy Singham, who has faced scrutiny over funding groups that oppose the United States, support China, and in some cases back Iran.
Why the nonprofit angle matters
Nonprofit groups often play a visible role in immigrant communities, and many provide legitimate cultural, educational, or charitable services. Lawmakers say that is exactly why the sector can be attractive for foreign influence efforts, since such groups often earn trust and operate with less public scrutiny than political organizations.
That concern has become sharper as Congress examines whether foreign governments or aligned proxies can use nonprofit status to move money, shape narratives, or pressure community leaders without triggering the same oversight that applies to campaign groups.
The letter asked the IRS to brief lawmakers by April 22 on steps being taken to address the issue. It also said the Treasury and IRS should review whether affected groups are violating limits on political activity and whether current enforcement tools are strong enough to stop foreign-linked influence operations inside the nonprofit system.
As scrutiny grows, the debate is likely to focus on where to draw the line between legitimate diaspora advocacy and activity that lawmakers say crosses into coordinated political influence on behalf of Beijing.
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