Party Lines Stay Firm in Disagreement Over IRS Scandal

Mark Wilson/Getty Images

Mark Wilson/Getty Images

Unsurprisingly, the bipartisan subcommittee that set off to review the IRS scandal returned with quite partisan results. Instead of one report, the committee released a two-part report with both a majority and a minority section, each differing on whether conservative groups were unfairly targeted by IRS auditors.

“After reviewing nearly 800,000 pages of documents and conducting nearly two dozen IRS and TIGTA (Treasury Inspector General for Tax Administration) employee interviews, the investigation found that the IRS used inappropriate selection criteria, burdensome questions, and lengthy delays in processing applications for 501 (c)(4) tax exempt status from both conservative and liberal groups,” said Senator Carl Levin (D-Michigan), the Chair and ranking member of the U.S. Senate Permanent Subcommittee on Investigations.

While the majority report refuted the claims in the TIGTA’s original investigation that conservative groups were unfairly targeted because the IRS had searched terms like “tea party” when collecting files for auditing organizations, the minority report found that the administration’s “audit adequately covered the relevant material and the TIGTA findings are valid.”

The majority report said that the IRS’s 2013 report failed to accurately compare how liberal groups were handled, noting community organizing group ACORN and the Occupy movement were also targeted by the IRS. “TIGTA audit’s findings, which found that the IRS used inappropriate selection criteria for conservative groups and subjected them to intrusive questions and improper delays, told only half the story, because it left out that the IRS mistreated liberal groups in the same way, and its key finding that the IRS’ actions were not politically motivated,” Levin said in a statement. 

The majority report notes that liberal groups were targeted in “be on the lookout” notices (BOLOs) and that the Treasury Inspector General for Tax Administration J. Russell George and other IRS officials had been informed. “Even after learning about them, the senior TIGTA officials remained silent for weeks about the BOLO entries for liberal groups, and provided incomplete and inaccurate testimony about them at Congressional hearings,” the report says. “When the BOLO listings for liberal groups were finally disclosed by Members of Congress and the media, senior TIGTA officials insisted that the IRS had not disclosed those listings during the TIGTA audit, despite ample evidence to the contrary.”

Levin added that even without political bias, the IRS still acted improperly. “The report criticizes the IRS for its failure to enforce the law, which prohibits tax exempt social welfare groups from engaging in campaign activities, and lays out its shortcomings in detail,” he said. “We are also releasing hundreds of IRS documents so the public can judge for itself what happened.”

On the other side, the minority report upholds that conservative groups were more often the target, saying that, “The inclusion of a scant few liberal groups by the IRS does not bear comparison to the targeting of conservative groups.” The majority report does brush over the fact that the IRS began collecting tea-party applications in 2010 for a long review, and that in a February 2011 email, former IRS official Lois Lerner (who had more than two years worth of emails go missing during the investigation) referred to the “Tea Party Matter” as “very dangerous,” saying that the review of tea party organizations could lead to a change in restrictions concerning political activity for tax-exempt organizations. Perhaps a re-appearance of those Lerner emails will blow the investigation open once again, but it seems like the IRS keeps losing more.

“The majority’s interpretation of the evidence fails to capture the extent of the IRS’s bias against conservative groups and flagrant abuse of power,” said Senator John McCain (R-Arizona). “Our tax system should not — and cannot — be used as a weapon to target political opponents, as the IRS has clearly done, especially when that agency is, at times, tasked with administering laws that involve political free speech.”

Of course, both sides are playing up the aspects of the investigation that help their party look good. Republicans aren’t acknowledging how much of a problem there is with the current restrictions for political activity by tax-exempt groups, which often direct millions in political donations, especially for conservative groups.

The failure of these two sides to come to an agreed assessment of the scandal may lead to trouble for the IRS moving forward. While this story is far from over, its implications will also affect changes to regulations for tax-exempt politically active groups. The Obama administration’s proposed tightening to the current restrictions may not have landed, but it’s highly possible some changes will be made in the future — changes that will concern both liberals and conservatives, though probably for different reasons.

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