The NRA faces yet another epic battle, this time with an entity that it originally created as its own charitable foundation. The prize in the latest struggle is not the political power of the NRA, but the Foundation’s treasury, with assets estimated to be well above $200 million. The new drama features some convoluted plot twists and an unfortunately familiar cast of characters.
A court-imposed consent judgment allowed the Foundation’s Trustees to create a new set of bylaws, allowing those Trustees to break away from the NRA and take the Foundation’s money with it. The Foundation has since rebranded itself as the “1791 Foundation.”
The story is complex, but becomes easy to understand with an explanation of tax law and a bit of NRA history.
While the NRA is a not-for-profit corporation, it is not considered a charity for tax purposes. Its tax status falls under 501(c)(4) of the Internal Revenue Code which designates it as a social welfare organization allowed to engage in political activity. Contributions to the NRA are not tax-deductible, and some of its income and expenditures may be taxable.
It is routine for a “C4” organization to set up a parallel foundation as a charity registered under IRC 501(c)(3). A C4 often has projects that qualify as “charitable” as defined in the tax code. The foundation typically operates on a track similar to the parent organization, but money the C3 charity receives and hands out is subject to stricter rules. As a qualified charity, the foundation, like a church, pays no taxes, and contributions are “tax-advantaged,” meaning donors may be able to deduct contributions. The charitable activities of the C4 organization are typically funded through grants from the C3 foundation that specify in detail how the money is to be spent.
Although the C3 is legally independent of the C4, it is also routine for their governing boards to “interlock,” that is, they may have members in common, as well as for certain C4 officers to hold ex officio positions on the C3 board that often include voting rights. For example, the American Civil Liberties Union is a C4 advocacy organization with a large board of around 80 members. The ACLU Foundation has around a dozen members, all of whom also serve on the board of the C4.
The 1990 creation of the NRA Foundation allowed the NRA to develop a dedicated vehicle for raising tax-deductible contributions to support charitable and educational activities aligned with its mission. Like charities established by other C4 organizations, the NRA Foundation designed its governance to align with its parent organization. Prior to the court-ordered changes of 2024, the Foundation’s bylaws required that a majority of Foundation Trustees be NRA Directors. The NRA President and Executive Vice President (CEO) served as ex officio trustees with full voting rights.
In 2020, the DC Attorney General filed suit against both NRA and the Foundation, alleging in the original complaint that “the Foundation has allowed itself to be financially exploited through, among other things, unfair loans and management fee payments to the NRA,” in effect plundering the Foundation’s assets through questionable grants, multi-million-dollar loans, and unjustified fees. So, in other words, business as usual under the LaPierre regime.
The case ended in a 2024 consent judgment that required the Foundation to strengthen its governance, adopt formal policies ensuring arm’s-length decision-making on grants and shared services, and adhere strictly to its own articles and bylaws. It looked great on paper. The Foundation would become independent of the Association’s proven corrupt management and the sycophants on its Board.
In reality, the judgment turned the Foundation and its treasury over to members of the same crew that had been narrowly prevented from running the National Rifle Association into the ground.
NRA officers and Directors, most of whom had been voted off the Board by a furious membership, had migrated to the Foundation, and now appear on the masthead of the 1791 Foundation’s website. The Foundation’s leadership now boasts three former NRA presidents, all of whom either stood idly by, or actively abetted the worst of LaPierre’s financial chicanery for at least the past dozen years, and a bevy of NRA Directors, most of whom, like the ex-Presidents, failed in their fiduciary responsibility to the Association. They were not backbenchers who can plausibly claim ignorance of the corruption that happened on their watch.
The ex-Directors include former NRA Second Vice-President David Coy who now serves as the Foundation’s Treasurer and CFO. A Certified Public Accountant and tenured professor of accounting, Coy served on the NRA Audit Committee that failed to find anything suspicious about LaPierre’s spending habits, or his dealings with NRA’s former public relations firm Ackerman McQueen. Several other Directors-turned-Trustees went on the record, some of them here on Ammoland, to defend the past regime before the 2024 NRA Board election which swept in the first slate of reform candidates, including my brother Jeff Knox. I’m not really a conspiracy buff, but it’s hard not to believe that this crowd moving to the Foundation was just happenstance. As my dad used to say, “I know the wind’s blowing because I see the trees moving.”
With the good intentions of separating the Foundation from the then-corrupt NRA Board, the court simply created a new pocket of corruption and threw in a fat bankroll. Citing court orders, the “reformed” Board of Trustees changed the process of electing Trustees to selecting its own members. Money contributed over the past 30-plus years, mostly by NRA members, is now controlled by a self-selected cabal of refugees from Wayne’s world. The more things change, the more they stay the same.
NRA Sues the NRA Foundation as Internal Power Struggle Freezes Program Funding
NRA Reform Gains Steam, But the Fight to Restore Trust Continues
About Chris Knox
Chris Knox has a lifelong interest in every aspect of guns, ranging from the history of firearms technology to hunting to competition. Brother to regular Ammoland contributor Jeff Knox, Chris considers protection of gun rights the family business. “Gun owners don’t need to like politics,” he says, “but ignoring politics is how you become a former gun owner.” Chris serves on the board of Arizona Citizens Defense League and competes in practical shooting, high-power rifle, and shotgun games.
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