TaxProf Blog

Editor: Paul L. Caron
Pepperdine University School of Law

Wednesday, September 28, 2016

The IRS Scandal, Day 1238

IRS Logo 2Wall Street Journal, An Impeachment, the IRS and Accountability:

Regarding Rep. John Conyers’s op-ed A Dangerous Rush to Impeach John Koskinen (Sept. 23): My understanding of Mr. Koskinen’s actions is that as head of the IRS he did nothing to stop the destruction of email evidence, has not provided documentation requested under the FOIA and has continued to obstruct and obfuscate requests for information by the House of Representatives. If this is correct, I ask Rep. Conyers to explain, in a bipartisan fashion, why these as well as other IRS actions are not actions in “deliberate bad faith.” As head of the IRS, he is accountable for all actions taken by the IRS, period.
Stephen Kane
Troy, Mich.

Rep. Conyers lets the cat out of the bag in telling us that in government you must prove someone acted in bad faith to get fired. Mr. Conyers, in the private sector in Illinois and some other states, an employer doesn’t have to have a reason to fire someone. But Mr. Koskinen can be oblivious to employee malfeasance and not be held responsible. I bet Wells Fargo Chief Executive John Stumpf wishes he were head of a government agency.
Ken Nelson
Chicago

I’m pretty sure that if John Koskinen’s agency had targeted liberals using the IRS’s vast power, John Conyers would be leading the charge for impeachment.
Tom Fleming
Caseyville, Ill.

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September 28, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Tuesday, September 27, 2016

The IRS Scandal, Day 1237

Politifact

Politifact, John Fleming Attacks IRS in Inaccurate Radio Ad:

In a recent radio campaign ad, Louisiana senate candidate John Fleming claimed that the head of the Internal Revenue Service ordered 24,000 emails erased before Congress could see them.

"The head of the IRS ordered 24,000 emails erased before Congress could review them, making sure the American people will never know the real truth," Fleming’s ad says. "The officials in charge follow the same dishonest playbook they’ve used for every scandal from Fast and Furious to Hillary’s emails."

Fleming is running for senator of Louisiana against six Republican candidates, including David Duke, as well as three Democrats and one unaffiliated candidate.

Fleming — who currently represents Louisiana in the House — is calling for the impeachment of IRS commissioner John Koskinen.

So far, Democrats are largely against the impeachment, and Republicans are divided on it, citing due process concerns. A vote on the matter was expected on Sept. 15, 2016, but it was delayed.

Since destruction of documents is a serious charge, we wondered if it was true that the head of the IRS "ordered 24,000 emails erased before Congress could review them." Independent reports suggest that’s not the case. ...

Emails were erased, and up to 24,000 are likely unrecoverable. However, there’s zero evidence that the head of the IRS ordered them destroyed. Multiple independent investigations confirmed that the erasure was accidental and not intended to obstruct information from Congress. Fleming’s ad says the opposite.

We rate this claim False.

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September 27, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (12)

Monday, September 26, 2016

The IRS Scandal, Day 1236

IRS Logo 2Wall Street Journal, Reputation Under Fire, the IRS Pulls a Gun—Al Capone’s:

The Internal Revenue Service doesn’t enjoy an abundance of favorable press. At present, it finds itself mired in controversy as its director, John Koskinen, hauled before Congress last week, tries to fend off an impeachment attempt.

On Tuesday, however, the IRS will participate in an unveiling ceremony it hopes will remind people of the positive things its agents have done. At least, one positive thing.

The agency is playing on the great American story of how Chicago mob boss Al Capone ended up in prison 85 years ago. It wasn’t the FBI’s “G-men” who put him in Alcatraz, nor Elliot Ness’s Prohibition-era agents. It wasn’t on account of gangland murders such as the 1929 Chicago Valentine’s Day Massacre, either.

Capone was undone by an undercover operation of the “T-men,” members of the Treasury Department’s IRS investigative division. He was pinched for cheating on his taxes.

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September 26, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Sunday, September 25, 2016

The IRS Scandal, Day 1235

IRS Logo 2Wall Street Journal op-ed: A Dangerous Rush to Impeach John Koskinen, by John Conyers (D-MI; Ranking Member, House Judiciary Committee):

The power of impeachment is a responsibility entrusted to the House of Representatives by the Constitution and to the House Judiciary Committee by our peers. I take this charge very seriously—and, for the most part, so do my colleagues in the majority.

I have served on the House Judiciary Committee long enough now to see impeachment done right and to see impeachment done wrong. I have participated in six of the 19 impeachments approved by the House since its inception. I voted in favor of five of them. In the early 1970s I helped to draft articles of impeachment against President Richard Nixon. I joined with 20 Democrats and six Republicans to send three of those articles to the House floor.

But I have never seen anything quite like the obsession of a few House members determined to impeach IRS Commissioner John Koskinen—without much evidence to back their claims, without an independent investigation by the House Judiciary Committee, and without even basic due process for the accused. ...

In the past few days, the actions of a small group of conservative House members threaten to break from this precedent and to lead us down a dangerous path. ...

On the merits, Mr. Koskinen’s critics have simply failed to make their case. They have been unable to produce evidence that the commissioner acted in bad faith at any point in his tenure. The Senate Finance Committee, the Justice Department and the Treasury Inspector General for Tax Administration have all concluded that there is “no evidence” of intentional misconduct of any kind.

But even if there were some evidence of Mr. Koskinen’s wrongdoing, the push to impeach him without due process in the House Judiciary Committee is dangerously misguided. Never, in the history of this body, have we impeached a government official without first proving he has acted in deliberate bad faith. ...

If the commissioner’s critics have their way, I fear we will have a new rule going forward: The House may impeach any government official, for any reason, without supplying evidence of deliberate wrongdoing, without an independent investigation, and without regard to basic fairness toward the accused.

Forcing a vote on impeachment in this manner will certainly not result in the removal of Commissioner Koskinen. Even if his critics succeed in the House, Senators of both parties have already stated their intent to bury the matter. So for all their efforts they will have profited nothing. And in the process they will have turned impeachment from a constitutional check of last resort into a tool of political convenience.

Washington Post op-ed:  Republicans’ Kangaroo Court, by Dana Milbank:

Impeachment is among the most severe and solemn powers Congress has, right up there with declaring war. Not since 1876 has an executive-branch appointee been impeached, and not in the history of the republic has Congress impeached an executive-branch official below the Cabinet level.

Now, Republicans in Congress would change that. On Wednesday, they wheeled out the sacred tool of impeachment — weeks before an election — for the purpose of smearing an honorable public servant, IRS Commissioner John Koskinen, in service of a lie. ...

There are just a few wee problems with the Republicans’ logic. The targeting of conservative groups ended in 2013. The Treasury Department’s inspector general, originally a Republican appointee, reported no evidence of political motivation in the targeting. The Justice Department, too, found “no evidence that any IRS official acted based on political, discriminatory, corrupt, or other inappropriate motives” and “no evidence that any official attempted to obstruct justice.” The official responsible for the targeting resigned before Koskinen came to the IRS at the end of 2013. And the same IG said last year that “no evidence was uncovered that any IRS employees had been directed to destroy or hide information from Congress, the DOJ, or [the IG].”

House Speaker Paul Ryan, eager to avoid the spectacle of the House voting to impeach an innocent man based on false charges without a proper hearing, got impeachment advocates to settle for Wednesday’s hearing in which Koskinen testified before the House Judiciary Committee. But that hardly improved matters: To say this impeachment inquiry is a kangaroo court would be an insult to marsupials. ...

There’s no dispute that Koskinen misinformed lawmakers in 2014 when he said that all evidence had been preserved relevant to the targeting. In fact, IRS workers a few months earlier had destroyed backup tapes that contained relevant emails. Koskinen says he didn’t know that at the time. The IG spent a year investigating the matter and attributed the erasure to bureaucratic errors, finding “no evidence that the IRS and its employees purposely erased the tapes in order to conceal responsive e-mails from the Congress.”

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September 25, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Saturday, September 24, 2016

The IRS Scandal, Day 1234

IRS Logo 2Hot Air, The IRS Chief’s Meeting With the Judiciary Committee Didn’t Go Particularly Well:

You may recall that only a week ago the House decided to postpone an impeachment vote for IRS commissioner John Koskinen in favor of holding hearings instead. This clearly distressed a number of conservatives who feel that the mismanagement of the agency and its various scandals were more than sufficient grounds to give the man his walking papers. Still, the hearings were bound to produce some fireworks and the first round certainly didn’t disappoint. Today I wanted to hit a few of the highlights.

Right out of the gate, Koskinen was asked about previous statements he’d made under oath regarding the preservation and recovery of emails and other documents from the entire Lois Lerner affair. When pressed on the subject, the commissioner didn’t exactly say that he’d lied about it, but did admit that some of the things he said turned out not to be true. ...

I suppose that comes down to the age old question of whether you lied or you were simply wrong about something. That’s a question which the committee (and the public) will have to answer for themselves.

There was another question raised concerning the IRS employees who were found to have deleted all of those Lois Lerner emails. Surely these are the culprits we’re looking for here. I imagine they must be cooling their heels in jail by now or at least awaiting trial, right? Nope. Turns out that they are both still on the IRS payroll… just in a different department....

Don’t even get me started on that entire saga again. We’ve written about it here extensively and the idea that someone in that department could have been “unaware” of the maelstrom surrounding their office is beyond the pale. But as long as the stonewall continues, there doesn’t seem to be much that anyone can do about it… short of impeaching the boss. Yet when he was asked about the rather, er… suspicious timing of all those records being destroyed, Koskinen didn’t have much of an answer.

 

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September 24, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Friday, September 23, 2016

The IRS Scandal, Day 1233

Thursday, September 22, 2016

The IRS Scandal, Day 1232

IRS Logo 2New York Times, I.R.S. Chief Calls Efforts to Oust Him ‘Improper’:

The commissioner of the Internal Revenue Service, John A. Koskinen, expressed regret Wednesday for management mistakes, but called the attempt by House Republicans to impeach him “improper,” warning that such threats would discourage people from government service. ...

He also rejected Republican calls for him to resign, but said he would leave office if the next president so wishes. Otherwise, Mr. Koskinen’s term ends in November 2017. ...

At the Judiciary hearing on Wednesday, Mr. Koskinen again testified that the destruction of emails was inadvertent, and that his testimony in 2014 was based on what he thought was factual at the time. But he expressed regrets.

“The truth is, we did not succeed in preserving all of the information requested. And some of my testimony later proved mistaken,” Mr. Koskinen said. He added, “Even closer communication with Congress would have been advisable.” ...

Several Democrats denounced the hearings as a “sham,” and many changed the subject, instead asking Mr. Koskinen leading questions in reference to the Republican presidential nominee, Donald J. Trump.

While Mr. Koskinen said he could not talk about any specific taxpayer, he said the I.R.S. would not object to someone releasing tax returns under audit — as Mr. Trump has suggested the I.R.S. would do in refusing to release his own returns. Mr. Koskinen also described violations of tax law by charitable foundations in hypothetical terms, much like critics have alleged against Mr. Trump’s foundation.

“I appreciate your being here to clear some of that up,” said Representative Ted Deutch, Democrat of Florida.

Wall Street Journal, IRS Commissioner Pushes Back on Impeachment Attempt:

Internal Revenue Service Commissioner John Koskinen defended himself Wednesday against an impeachment attempt, labeling Republicans’ push to remove him from office as “improper” and warning that such a move would deter qualified people from serving in government.

House GOP hard-liners say impeachment is warranted because of the destruction of evidence sought by congressional investigators and because Mr. Koskinen failed to promptly inform Congress when he learned of the destruction. They also pressed him on the thoroughness of the agency’s search for records, which Congress demanded as part of inquiries into the IRS treatment of conservative groups under Mr. Koskinen’s predecessors.

“Your overall record is one of gross incompetence and extreme negligence,” Rep. Raul Labrador (R., Idaho) told Mr. Koskinen during a House Judiciary Committee hearing on Wednesday, urging the commissioner to resign.

Although he expressed regret for the agency’s shortcomings in protecting evidence and the fact that some of his statements later proved mistaken, Mr. Koskinen said he wouldn’t quit and said he hadn’t done anything to deserve impeachment.

“There is no evidence anywhere that I knew something I didn’t tell people about, that I falsified or misrepresented or lied,” he told reporters after the hearing, adding that it would set a “terrible precedent” if he were pressured out of office.

National Review: The IRS Commissioner Belongs in Prison, by Kevin D. Williamson:

I do not usually go out of my way to publicly disagree with National Review editorials, but I respectfully dissent from our piece calling for the impeachment of IRS commissioner John Koskinen.

He shouldn’t be impeached. He should be imprisoned.

When the feds couldn’t make ordinary criminal charges stick to the organized-crime syndicate that turned 1920s Chicago into a free-fire zone, they went after the boss, Al Capone, on tax charges. Under Barack Obama, the weaponized IRS has been transformed into a crime syndicate far worse than anything dreamt of by pinstriped Model-T gangsters — because Al Capone and Meyer Lansky did not have the full force of the federal government behind them. 

Koskinen was called before the House on Tuesday to explain a few things. One of those things is: Why is the IRS destroying evidence under subpoena in this case? Another was: Why is the IRS commissioner lying to Congress?

Koskinen is fluent in the mustelid dialect of Washington: “We did not succeed in preserving all of the information requested, and some of my testimony later proved mistaken.” There is a term for failing to “succeed in preserving information requested” during an official investigation: obstruction of justice.

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September 22, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Wednesday, September 21, 2016

The IRS Scandal, Day 1231

IRS Logo 2The Daily Signal, Judiciary Committee Set to Audit Top IRS Tax Agent:

A last-minute deal between House conservatives and Republican leadership delayed a floor vote to impeach the head of the IRS last week. But the top taxman isn’t in the clear just yet.

For the first time, IRS Commissioner John Koskinen will come under oath to plead his case, appearing before the House Judiciary Committee on Wednesday. A product of compromise, that impeachment hearing means different things to different factions of Congress.

Freedom Caucus members, who have been demanding Koskinen’s early retirement for months, see the hearing as a formality necessary to fire Koskinen. Others see it as a prerequisite to a longer impeachment process and an opportunity to afford the taxman his right to due process.

It’s undisputed that Koskinen will face an unfriendly jury Wednesday, though.

Fourteen of the 23 Republican Judiciary Committee members have said already that the taxman is guilty of wrongdoing, including Oversight Committee Chairman Jason Chaffetz, R-Utah, who first filed articles of impeachment last October.

Making matters worse for the IRS chief, seven Freedom Caucus members sit on the committee, including Chairman Jim Jordan, R-Ohio, who has helped quarterback the effort to send Koskinen into early retirement.

Conservatives argue that Koskinen is unfit to lead the IRS because he obstructed a congressional investigation into the agency’s unfair treatment of tea party groups applying for tax-exempt status before the 2012 elections.

The White House has been unwavering in their support of Koskinen. Speaking at a Democrat fundraiser last week, President Barack Obama said the impeachment effort “is crazy.” And Koskinen, who has hired a personal defense attorney, maintains that those allegations “lack merit.”

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September 21, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, September 20, 2016

The IRS Scandal, Day 1230

IRS Logo 2Americans for Tax Reform, Koskinen's IRS Failed to Search Five of Six Locations for Lois Lerner Emails:

IRS Commissioner John Koskinen will appear before the House Judiciary Committee to defend himself against impeachment charges following his role in the Lois Lerner targeting scandal.

Koskinen was appointed to lead the IRS after promising to bring transparency and openness to the embattled agency. He has failed.

The IRS failed to search five of six possible sources of electronic media for Lois Lerner’s emails, according to documentation released by the House Oversight Committee in July 2015.

Over the course of investigations into the Lois Lerner targeting scandal, Commissioner John Koskinen repeatedly assured Congress that he would provide all of Lois Lerner’s emails. But based on testimony from the Treasury Inspector General for Tax Administration (TIGTA), this did not occur. The agency’s ineptness -- or corruption -- resulted in 24,000 Lerner emails being lost when they were “accidently” destroyed. 

According to TIGTA official Timothy Camus, the IRS had six possible sources to search for Lois Lerner’s emails:

“The hard drive would have been a source, Blackberry source, backup tapes a source, the backup tapes for the server drives and then finally the loaner lap tops.”

When asked how many of these sources the IRS searched, Camus was unable to say for certain whether the IRS had searched for any. ...

Commissioner Koskinen stated that the IRS took “extraordinary efforts” to recover any emails, but this is clearly not the case. Years after the investigations into the Lois Lerner targeting scandal began, the agency’s unprecedented obstruction has meant Americans are no closer to the truth.

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September 20, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (8)

Monday, September 19, 2016

The IRS Scandal, Day 1229

IRS Logo 2Newsmax, Christie Backs Trump Tax Release Delay Given US Mistrust of IRS:

Donald Trump is being wisely advised to keep his tax forms under wraps during an audit "given the history of the Obama administration" to use IRS In "as a weapon" against conservatives, New Jersey GOP Gov. Chris Christie said Sunday.

In an interview on CNN's "State of the Union," Christie, a former primary presidential candidate who is now one of Trump's top advisers and surrogates, said most Americans' don't trust the IRS.

"Given the history of the Obama administration and IRS to use the IRS as a weapon against conservative groups and candidates, I don't blame the accountants for saying better safe than sorry," he said, in reference to the agency's tea party targeting scandal.

"I bet your listeners and viewers out there don't trust the IRS as far as they could throw them," he added. "I don't blame his lawyers and accountants for telling him until the book is closed, and the IRS can't go after you, you shouldn't release your tax returns."

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September 19, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Sunday, September 18, 2016

The IRS Scandal, Day 1228

IRS Logo 2Forbes: Congress To IRS: The Beatings Will Continue Until Morale Improves, by Stuart Gibson:

A subset of House Republicans often disagrees with the priorities of their leaders. And the rules allow them to force a floor vote. Their most recent override of leadership’s priorities involves bringing to the House floor a resolution to impeach John Koskinen, who has served as commissioner of internal revenue for the past 33 months – perhaps the longest 33 months of his life. And here I side with leadership.

Koskinen was brought in to help the IRS recover from a 2013 scandal over its handling of applications for tax-exempt status by both right- and left-leaning groups. He took charge of the agency, bringing a can-do attitude and expertise from his experience in private industry. He cleaned house in the offending office and changed the way the IRS processes applications for tax exemption.

Koskinen’s problem was that he took office before congressional Republicans had extracted their pound of flesh from the agency that everyone loves to hate. Having decided upfront that the Obama administration had used the IRS to target its political opponents – a conclusion, unlike President Nixon’s well-documented enemies list, wholly unsupported by the evidence – Republicans began investigations to prove their predetermined conclusion. When they found no proof, they attacked Koskinen for failing to produce evidence confirming their view of what happened.

And it wasn’t just Koskinen. Viewing his alleged non-responsiveness as indicative of the agency’s overall unwillingness to perform sufficient penance for the sins committed by a few employees in one small corner of the agency, Congress placed a tourniquet on the IRS budget. And when that failed to elicit the desired outcome – whatever that might be – Congress tightened the tourniquet.

Here’s the problem: In an effort to punish the IRS institutionally, Congress has punished 90,000-plus dedicated employees who did nothing wrong, along with millions of American taxpayers. The best and brightest IRS employees are leaving – and they are not being replaced. Constituents endure unbearable wait times to get IRS assistance and receive poor service when they manage to reach a human being.

What is Congress’s goal? If it expects to improve taxpayer service by starving the IRS budget, impeaching its leader, and berating its employees, Congress will be disappointed. The longer the beatings continue, the harder it will be for the IRS to attract great – or even competent – leaders and employees, and the longer it will take for Americans actually to receive the service they deserve from the IRS.

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September 18, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Saturday, September 17, 2016

The IRS Scandal, Day 1227

IRS Logo 2Letter From Reginald J. Brown (WilmerHale, Washington, D.C.) on Behalf of John Koskinen to House Judiciary Committee (Sept. 16, 2016):

As you know, Commissioner Koskinen deeply respects the work and authority of the Committee and has agreed to testify under oath on Wednesday, September 21, as requested. He hopes to address some of the confusion regarding basic facts and to explain the reforms that the IRS has implemented during his tenure to address unacceptable practices that took place before he arrived at the agency. We appreciate the professionalism and substantive nature of the Committee's inquiry to date under your leadership and hope that you will find the substance and tone of Commissioner Koskinen's testimony constructive and respectful as well.

We are concerned, however, that some may believe that Commissioner Koskinen's voluntary appearance at this hearing is an appropriate substitute for regular order and the traditional approach to addressing impeachment proceedings. As you know, the scheduled hearing, with an opening statement and timed rounds of Member-directed questions on any topic of their choosing, does not reflect the full range of deliberate and balanced procedures that this Committee has developed to ensure fairness and legitimacy in an actual impeachment inquiry.  Those procedures include the right to make opening and closing statements, the right to call and cross-examine witnesses, the right to present evidence, the right to examine all evidence obtained by the Committee, the right to make evidentiary objections for the record, the right to be formally and directly represented in proceedings by counsel, and the right to respond to all evidence cited by the Committee.

Should the Committee proceed to a formal impeachment inquiry, we would expect to be allowed to exercise those rights to present a robust legal and factual defense to the many false allegations that have been lodged against Commissioner Koskinen. Testimony under oath from a single witness-before he has even been allowed to see any evidence against him and with no right to present corroborating evidence to address false or mistaken allegations-is no substitute. Indeed a process of testimony followed immediately by a floor vote, with no established standards, validated evidence, or findings of fact would be more akin to a foreign show trial than the solemn process contemplated by the Framers and generations of Congressional leaders, including Members of this Committee. ...

We hope that, following Wednesday's hearing, this Committee will decide against reporting to the House floor a resolution authorizing a formal impeachment proceeding. However, should the Committee take that step, we are fully prepared to assist the Committee in developing a solid and vetted factual and legal record on which Members can rely in exercising their constitutional responsibility. After reviewing whatever documentary evidence the Committee gathers, we would expect to be allowed to make objections, cross-examine each witness that the resolution's proponents put forward, and call our own witnesses to expose what we believe are blatant factual errors in the resolution. We would also identify the proposed standards for impeachment in the resolution that are inconsistent with the Constitution's commands. We are confident that a complete record would show that the impeachment of Commissioner Koskinen is wholly unwarranted.

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September 17, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Friday, September 16, 2016

The IRS Scandal, Day 1226

IRS Logo 2Wall Street Journal editorial, The Impeachment Distraction: Koskinen and the IRS Deserve Rebuke, but Not If It Costs the Senate:

House Speaker Paul Ryan has managed to unite his fractious GOP caucus around some common campaign goals. So it’s a pity that two months from an election some House Members are driving an issue that could cost Republicans control of the Senate.

Louisiana Rep. John Fleming on Tuesday moved on a privileged resolution to force the House to vote as soon as Thursday to impeach IRS Commissioner John Koskinen. The IRS chief has earned public opprobrium, but the timing of this effort could boomerang and end up making the IRS less accountable.

These columns have been out front in documenting Mr. Koskinen’s failures after he promised to clean up the IRS following its political targeting of conservative nonprofits. Mr. Koskinen has failed to be candid with Congress and defied subpoenas. Documents requested by Congress were destroyed on his watch. He’s done nothing to reform the agency and he has supported a new draft regulation, now in temporary abeyance, that would reinforce the agency’s political vetting.

The question is whether impeachment is the right remedy at the current political moment. The case for it is that Congress needs to reassert its own powers against a runaway executive branch. President Obama has diminished the power of the purse and won’t prosecute contempt citations against witnesses who refuse to testify on Capitol Hill. Impeachment is about all Congress has left.

The problem is that a trial is doomed to fail in the Senate, where a two-thirds vote is required to convict. There are differing views on whether a House impeachment vote triggers an automatic Senate trial, but if it does this could require vulnerable GOP incumbents to stay in Washington at the height of the campaign. This would be a gift to Democrats trying to regain the majority. ...

No doubt many House Members genuinely believe Mr. Koskinen deserves impeachment, but other Republicans have legitimate doubts that his offenses rise to the level of “high crimes and misdemeanors” mentioned in the Constitution. An impeachment trial now will divide Republicans while uniting Democrats. Why take the risk when Mr. Koskinen is leaving office in a mere four months?

Congress needs to think seriously about how to reassert its powers no matter who wins the White House. But the reality is that a Senate Democratic majority would make that task impossible. Republicans should focus on re-electing their majorities in Congress as a check on the next President, instead of making self-defeating political gestures.

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September 16, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Thursday, September 15, 2016

The IRS Scandal, Day 1225

IRS Logo 2Politico, GOP Negotiators Reach Deal to Postpone IRS Impeachment Vote:

House Freedom Caucus Chairman Jim Jordan (R-Ohio) and Judiciary Committee Chairman Bob Goodlatte (R-Va.) have reached a tentative compromise to postpone a vote to impeach the IRS commissioner, sources familiar with the talks told POLITICO.

Under the terms of the emerging deal, IRS Commissioner John Koskinen would testify before the Judiciary panel next week, and any impeachment vote would likely be postponed until after the November election rather than take place on Thursday, the sources said.

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September 15, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Wednesday, September 14, 2016

The IRS Scandal, Day 1224

IRS Logo 2New York Times editorial, Will Speaker Paul Ryan Stand Up to the Freedom Caucus?:

The leadership of the House speaker, Paul Ryan, is about to be challenged by the latest partisan mischief from ultraconservative Republicans — a meritless and unprecedented attempt to impeach the commissioner of the Internal Revenue Service, John Koskinen. ...

To impeach the commissioner, his antagonists aim to bypass the House leadership and bring the measure directly to the floor as a privileged resolution. Such a move threatens to set a dangerous new low in congressional politicking. Should this shabby precedent be established, what sub-cabinet officials and bureaucrats might be singled out next? ...

The speaker could show some leadership by sending any such floor motion to a quick and quiet death in committee. That is exactly what the Democratic Speaker Nancy Pelosi did in 2008, when Representative Dennis Kucinich of Ohio brought a privileged resolution to the floor to impeach President George W. Bush.

But there is already speculation that Mr. Ryan, fearing the Freedom Caucus, might try to appease it with a measure of censure for the same baseless charges. This would be no less damaging to Mr. Koskinen’s reputation — or to the speaker’s. It would be another signal that Mr. Ryan remains hostage to his ultraright members.

Los Angeles Times editorial, Don't Impeach the IRS Commissioner:

[T]he bill of particulars that accompanies the resolution proves, at most, that Koskinen wasn’t as attentive to the importance of securing records sought by Congress as he should have been. It’s also clear that he misspoke when he told a congressional committee that ”every email”  associated with Lois Lerner, a former IRS official responsible for tax-exempt groups, had been preserved; in fact, IRS employees in West Virginia had erased as many as 24,000 of her emails. (A Treasury Department inspector general found no evidence that the erasures were a deliberate attempt to destroy evidence.) But inaccurate or incomplete testimony isn’t the same as willfully lying to Congress.     

In short, there is nothing to suggest that Koskinen is guilty of the “high crimes and misdemeanors” the Constitution cites as grounds for impeachment. And even if the House were to vote to impeach him, there is no chance that the Senate would provide the two-thirds majority necessary for a conviction. 

The GOP’s ire at the apparent targeting of conservative tax-exempt groups is understandable, but that’s not the only thing motivating the Freedom Caucus. Instead, the attempt to impeach Koskinen is a political exercise that can’t be divorced from longstanding efforts by conservatives to demonize and defund the IRS. More directly, it’s tied to Republicans’ apparent determination to stop the IRS from enforcing the law barring political campaigns from masquerading as charities. If the House were to impeach the commissioner — or even censure him — the reputation of that body would suffer and members would be tempted to use the impeachment power to push other pet political causes. The only fair outcome is for the House to refer the resolution to the panel the Freedom Caucus is trying to bypass, the House Judiciary Committee. The resolution is likely to die there, as it should.

Responsible Republicans — including Speaker Paul Ryan and Majority Leader Kevin McCarthy — need to support that action and stand against this abuse of the impeachment power.

Washington Times, Impeach IRS Commissioner John Koskinen:

The House Freedom Caucus will attempt to force a vote on impeaching IRS Commissioner John Koskinen Tuesday on the House floor.

Good. The man needs to go. Or at least be held accountable. ...

What are Mr. Koskinen’s crimes?

He’s actively tried to stonewall congressional investigation into the tea-party scandal. He’s failed to comply to several congressional subpoenas. In 2014, he was asked to supply all of Ms. Lerner’s emails, but he did nothing to track or preserve such documentation. Weeks after the subpoena, IRS employees in West Virginia erased 422 backup tapes, destroying as many as 24,000 of Ms. Lerner’s emails (obstruction of justice, anyone?), despite an agency preservation order.

In congressional hearings, Mr. Koskinen withheld from Congress both the preservation order and the destruction of tapes and also failed to disclose details regarding Ms. Lerner’s destroyed hard drive.

Mr. Koskinen also assured Congress that his agency has gone to “great lengths” to retrieve Ms. Lerner’s lost emails, however, when the Treasury Department inspector general did its own search, it found 1,000 new emails in 14 days. It appeared the IRS never searched disaster backup tapes, Ms. Lerner’s BlackBerry and laptop, the email server and its backup tapes.

Then, to put salt in the wounds, Mr. Koskinen then declined to show up to his own impeachment hearing.

It’s Congresses job to be a check on the executive branch’s power, and Mr. Koskinen has repeatedly shown his disrespect for legislative branch.

Jonathan Turley, of the George Washington University Law School, said in June testimony to the House Judiciary Committee that the Koskinen controversy “falls at the very crossroads of expanding executive power, diminishing congressional authority, and the rise of the Fourth Branch,” which consists of “federal agencies that exercise increasingly unilateral and independent powers.” ...

For Congress’s job to hold the executive branch accountable, to serve as a check on its power, it must act if it doesn’t want to become irrelevant.

Wall Street Journal Law Blog, Scholars Say Impeaching IRS Commissioner Would Set Dangerous Precedent:

As House Republicans weigh impeachment proceedings against IRS commissioner John Koskinen, a group of constitutional scholars are urging lawmakers to hold back. ...

In a letter last week addressed to House Speaker Paul Ryan and House Minority Leader Nancy Pelosi, a group of constitutional law professors say impeaching the IRS chief would set a dangerous precedent. ...

A larger group of tax scholars also said they opposed impeachment proceedings in an earlier letter to House leaders.

National Society Of Accountants Send Letter to House Leaders Opposing Koskinen Impeachment:

Leaders of the National Society of Accountants (NSA) have sent a letter to leaders of the U.S. House of Representatives opposing any resolution to impeach or censure Internal Revenue Service (IRS) Commissioner John Koskinen.

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September 14, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Tuesday, September 13, 2016

The IRS Scandal, Day 1223

IRS Logo 2Seattle Times, Conservative Effort to Impeach IRS Chief Won’t Succeed:

A campaign-season drive by conservative House Republicans to impeach the IRS commissioner won’t succeed. With solid Democratic opposition and resistance from many in the GOP, there simply aren’t enough votes to oust John Koskinen from his post.

Members of the conservative House Freedom Caucus are pushing it anyway, and it could come to a head over the next week or two. A look at the effort:

Q: Why do conservatives want to impeach Koskinen?

A:  They accuse him of lying to Congress, not answering subpoenas and overseeing an agency that destroyed documents. They say those actions hindered the House GOP’s long-running investigation of how the Internal Revenue Service unfairly treated tea party groups that sought tax exemptions several years ago, before Koskinen was with the agency.

Two months to the election, going after Koskinen and the IRS is popular with many conservative voters, for whom the IRS has long been a dirty word. They’ve not forgiven its handling of tea party organizations. And Koskinen was appointed by President Barack Obama, another favorite conservative target.

Q: What do Koskinen and Democrats say?

A: They say the accusations are unfounded. “There is no evidence that Commissioner Koskinen ever in any way sought to impede Congress’ oversight of the IRS,” Koskinen’s personal lawyers wrote in documents they provided Sunday.

While the IRS acknowledged it subjected tea party groups to unfairly harsh treatment, the Justice Department and the IRS inspector general found no evidence the agency was motivated by political bias, and it’s not been proved that documents were purposely destroyed. Democrats say the impeachment effort is aimed at stirring up conservative votes and campaign donations.

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September 13, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Monday, September 12, 2016

The IRS Scandal, Day 1222

IRS Logo 2Washington Times, IRS Refuses to Abandon Targeting Criteria Used Against Tea Party, Conservative Groups:

The IRS is refusing to recant the targeting criteria it used to single out tea party groups for intrusive scrutiny, according to court filings made public Wednesday that show the tax agency still struggling with the fallout from the scandal.

At least three tea party groups are still awaiting approval from the IRS more than three years after agents publicly admitted they’d asked inappropriate questions and put the groups through unreasonable delays in obtaining tax-exempt status.

Last month the IRS told both Congress and a federal judge that it would start processing the outstanding applications — but the agency has refused to say how or when, leaving the groups themselves struggling to make sense of things.

Making matters ever more difficult, the IRS specifically refused in court papers to reject further use of the criteria it used to single out tea party and conservative groups in the first place.

“Despite all the representations made by the IRS about having changed its ways, it still asserts that the viewpoint-based Targeting Criteria are relevant for making a determination of tax-exempt status,” Edward Greim, the lawyer representing tea party groups in a class-action lawsuit, told the U.S. District Court for the Southern District of Ohio.

Just weeks ago, IRS Commissioner John G. Koskinen had assured Congress the targeting was a thing of the past, and said his agency will no longer use the “Be on lookout,” or BOLO, lists. ...

Mr. Greim said to be wary of IRS promises, saying the agency has been willing to mislead the court in the past with a “willingness to say one thing (in a sworn declaration, no less) and do the other.” And he said the IRS has hinted that while it may replace its targeting list, which delays or blocks applications at the front end, it could step up “less well-known forms of scrutiny,” including ongoing reviews of tea party groups.

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September 12, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Sunday, September 11, 2016

The IRS Scandal, Day 1221

IRS Logo 2The Daily Signal, ‘Just a Charade’: House Conservatives Decry IRS Chief’s Capitol Hill Visit:

Internal Revenue Service Commissioner John Koskinen made the rounds Wednesday on Capitol Hill to discuss his potential impeachment, meeting with two of the largest GOP House caucuses.

Members of the conservative House Freedom Caucus were furious about Koskinen’s visits with lawmakers who belong to the moderate Tuesday Group or the conservative-leaning Republican Study Committee.

These conservatives have been calling for the top taxman’s impeachment since October.

One of the members who quarterbacked the impeachment effort, Rep. Tim Huelskamp, R-Kan., described the Koskinen tour as tantamount to allowing a defendant to chat up a jury “while the prosecuting attorney is away.”

“You’re going to give the most hated official in the Obama administration a free platform, without testifying under oath, to defend himself and his targeting of conservative groups?” Huelskamp told The Daily Signal. “This is just a charade.” ...

One member of the Freedom Caucus suggested conservatives might be persuaded to soften their stance on Koskinen if the establishment would agree to keep any spending bills from taking flight during the lame-duck session.

”It might very well be that we back off of Koskinen until the first of [next] year,” the lawmaker told The Daily Signal on condition of anonymity, “if you [GOP leaders] do a continuing resolution through March.”

Other members of the Freedom Caucus remain intent on getting their political pound of flesh. The IRS targeting scandal has been a focal point for Republicans since the public first learned in 2013 that the agency put conservative groups under extra scrutiny.

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September 11, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, September 10, 2016

The IRS Scandal, Day 1220

IRS Logo 2Washington Post op-ed: Congress Should Impeach The IRS Commissioner — Or Risk Becoming Obsolete, by George F. Will:

Republican congressional leaders ardently want conservative members of the House to not force a vote on impeaching the IRS commissioner. The public does not care about John Koskinen’s many misdeeds. And impeachment will distract attention from issues that interest the public. And because Democrats are not ingrates, the required two-thirds of the Senate will never vote to convict Koskinen, whose behavior continues the pattern of doing what Democrats desire with the most intrusive and potentially punitive government agency.

These Republican leaders’ reasons are cumulatively unpersuasive. Resuscitating the impeachment power would contribute to revitalizing Congress’s Article I powers. Impeachments are rare — no appointed official of the executive branch has been impeached in 140 years. But what James Madison called the “indispensable” power to impeach should not be allowed to atrophy, as has Congress’s power to declare war. ...

In June testimony to the House Judiciary Committee, Jonathan Turley of the George Washington University Law School noted that the Obama administration stands accused of “effectively weaponizing the IRS.” And the Koskinen controversy comes as Congress “is facing an unprecedented erosion of its authority vis-a-vis the executive branch.” The “increasing obstruction and contempt displayed by federal agencies in congressional investigations reflects the loss of any credible threat of congressional action. Congress has become a paper tiger within our tripartite system — a branch that often expresses outrage, yet fails to enforce its constitutional authority.”

The Koskinen controversy, Turley said, “falls at the very crossroads of expanding executive power, diminishing congressional authority, and the rise of the Fourth Branch,” which consists of “federal agencies that exercise increasingly unilateral and independent powers.” As Turley noted (and as Hillary Clinton can ruefully attest), “private litigants like Judicial Watch” are nowadays more successful than Congress in prying information from the executive branch. And (as the Lerner case illustrates) “the administration has effectively foreclosed avenues like the referral of criminal contempt and other sanctions that should be imposed for providing misleading statements to Congress.” ...

The Constitution authorizes impeachment for “high crimes and misdemeanors.” Madison favored this language and interpreted it to include “maladministration,” which surely encompasses perjury and obstruction of Congress. The idea that an IRS commissioner is not a high enough official for impeachment ignores, Turley says, “the realities of the modern regulatory state.” Commissioners have authority over 90,000 employees collecting $2.5 trillion in revenues annually. ...

One of the articles of impeachment filed by the House against Richard Nixon was that he, “acting personally and through his subordinates ” (emphasis added), had “endeavored” to use the IRS to violate Americans’ rights, causing IRS actions “to be initiated or conducted in a discriminatory manner.” If presidents are, as McCarthy says, “derivatively responsible” for misconduct by executive branch subordinates, surely those officials are responsible for their own misconduct and that of underlings. Refusing to impeach Koskinen would continue the passivity by which members of Congress have become, in Turley’s words, “agents of their own obsolescence.”

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September 10, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, September 9, 2016

The IRS Scandal, Day 1219

IRS Logo 2Wall Street Journal, House Republicans Weigh Impeaching IRS Commissioner John Koskinen:

House Republicans have no affection for the Internal Revenue Service after three years of mounting frustration about what they see as the tax agency’s slow and incomplete responses to congressional investigations. But many are shying away from the aggressive step urged by some hard-liners: impeaching IRS Commissioner John Koskinen now.

Lawmakers are debating how far to go as they weigh the political risks of irritating some of their most ardent supporters with any vote that even resembles letting Mr. Koskinen off the hook. What is giving them pause about impeachment are conservatives’ push to bypass the Judiciary Committee and the slim chances of removing Mr. Koskinen from office. That would require Senate Republicans to overcome their reluctance and also attract more than 20 Democratic votes—the number needed to get the necessary two-thirds majority in the Senate—making it a clear dead end.

House Republicans’ internal standoff shows the limits of raw politics in the general-election season after years of conservatives rallying against the IRS, a movement that has helped to restrict the agency’s budget and inspired calls from the right to eliminate the IRS entirely. ...

Impeachment backers plan to use a procedural tactic to force a vote on the House floor as soon as next week, and House Republicans will meet behind closed doors beforehand in an effort to hash out the internal disagreement. ...

The bill of particulars against Mr. Koskinen stems from his response to congressional investigations. Under his watch, the agency destroyed backup data that included emails belonging to Lois Lerner, who had led the office that oversaw nonprofit groups. The impeachment resolution says Mr. Koskinen “failed to act with competence and forthrightness” in disclosing the destruction and that the agency didn’t try hard enough to preserve all documents.

Mr. Koskinen has said the destruction was unintentional and that he waited to inform Congress until he had complete information.

Republicans say Mr. Koskinen’s actions prevented them from uncovering the truth about what happened to tea-party groups and why.

Democrats say there is no evidence the agency’s actions were politically motivated. Instead, they say it is clear the IRS was trying—clumsily and slowly—to come up with a rule for judging whether tax-exempt groups met the tax code’s rules that limit political involvement of nonprofits.

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September 9, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Thursday, September 8, 2016

The IRS Scandal, Day 1218

IRS Logo 2The Hill, IRS Chief Makes His Case to GOP Lawmakers:

IRS Commissioner John Koskinen on Wednesday made his case against impeachment to two groups of House Republicans. Koskinen met with members of the moderate Tuesday Group as well as with members of the conservative Republican Study Committee, where some lawmakers support his impeachment. “He just wanted to state his case,” said Tuesday group co-chair Charlie Dent (R-Pa.).

Bloomberg, House Will Hold Vote on Whether to Impeach IRS Chief, Ryan Says:

Speaker Paul Ryan said Wednesday the House will vote on whether to impeach Internal Revenue Service Commissioner John Koskinen, and he indicated members won’t be pressured to vote one way or the other.

Daily Caller, Hatch Insists The Senate Will Never Impeach IRS Commissioner:

Republican Sen. Orrin Hatch says there is not even the “slightest chance” the Senate will impeach IRS Commissioner John Koskinen anytime soon.

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September 8, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Wednesday, September 7, 2016

The IRS Scandal, Day 1217

IRS Logo 2Washington Post editorial, House Conservatives Want to Impeach the IRS Director. That Would be a Big Mistake:

Congress returned from its summer break Tuesday to what may be a brief but contentious pre-election legislative spell. Among the likely arguments: whether Congress should radically change its relationship with the executive branch and hobble the government in the process.

For months, a group of hard-line conservative lawmakers has been pressing to impeach Internal Revenue Service Commissioner John Koskinen, in an effort that may soon come to a head. The context for the campaign against Mr. Koskinen is the continuing GOP obsession with the way the IRS reviewed nonprofit groups’ tax-exempt status, following reports that conservative groups were disproportionately scrutinized. The initial reports turned out not to reflect much of a scandal, which was more about bureaucratic obliviousness than purposeful anti-conservative activity. ...

The Founders designed federal impeachment procedures to be used sparingly, erecting barriers to removing executive officers that did not exist in the English system, Michael J. Gerhardt, a University of North Carolina law professor, told the House Judiciary Committee in June. They also purposely avoided allowing impeachment in cases of mere “maladministration,” raising the bar to the much more serious “high crimes and misdemeanors” standard. “The Founders did not want high-ranking officials in the executive or judicial branches to be subject to impeachment for their mistakes in office,” Mr. Gerhardt testified.

The cumbersome and partisan Senate confirmation process has made it hard enough to fully staff the highest realms of government with competent people. Never-ending, partisan impeachment proceedings against executive officers would make it even harder to keep the essential mechanics of government working. The result would be more bureaucratic bungling, not less.

Politico, Senate GOP Plots Way to Dodge Koskinen Impeachment:

Fighting to hold onto their slim majority, Senate Republicans are planning to wriggle out of considering the impeachment of IRS Commissioner John Koskinen even if the House forces the issue.

It's a two-part plan: First Senate Republicans are attempting to convince their conservative House brethren to avoid the matter entirely. Then, if the House passes an impeachment resolution by a simple majority, Senate Republicans will seek a procedural out to avoid a controversial impeachment trial that would draw attention to a Senate GOP that's tried to portray itself as the stable arm of Congress.

But with House Republicans divided over the Freedom Caucus's charge to impeach Koskinen over his alleged obstruction of a congressional investigation, it's not too late, GOP senators say, to change course and punt on impeachment at least until after the November election.

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September 7, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Tuesday, September 6, 2016

The IRS Scandal, Day 1216

IRS Logo 2Charlotte Observer editorial, Should IRS Chief Be Impeached?:

Congress returns to work Tuesday, and at the top of several members’ to-do list is impeaching IRS Commissioner John Koskinen. ...

It’s hard, we know, to gin up much sympathy among Americans for the chief tax collector. It’s even harder when the Internal Revenue Service has made so many missteps in recent years. The extent of Koskinen’s imperfections, though, is debatable; they almost surely fall far short of the “high crimes and misdemeanors” that impeachment requires. ...

It’s possible his performance has been sporadic and his commitment to transparency inconsistent. That would, unfortunately, make him a Washington regular, but not a criminal traitor.

At a minimum, he deserves an exhaustive hearing and opportunity to defend himself in front of the House Judiciary Committee before such an extraordinary — and politically motivated — action is taken.

That’s not what Freedom Caucus members like North Carolina’s Rep. Mark Meadows envision. They are willing to take Koskinen’s fate to the House floor for an up-or-down vote with no due process. That would violate tradition and establish an ominous precedent.

Koskinen (a Duke grad and former chair of Duke’s board of trustees) took over in December 2013, charged with cleaning up the mess made by Lois Lerner. Lerner was at the center of a scandal prior to Koskinen’s arrival in which the IRS mostly targeted conservative political groups in their applications for nonprofit tax-exempt status.

Congress issued a subpoena to Koskinen seeking all of Lerner’s emails. Weeks later, IRS employees in West Virginia erased 422 backup tapes that contained as many as 24,000 of Lerner’s emails.

There is no evidence that Koskinen was personally involved in the deletion. The Republican-appointed inspector general investigating Lerner’s actions said the erasure was an accident stemming from a miscommunication.

The rest of the resolution to impeach Koskinen is flimsy. It accuses him of making “false and misleading statements” to Congress. Koskinen says he testified to what he thought was true at the time, even if some of it later turned out not to be accurate. ...

Lerner’s actions were unacceptable, and the IRS’s failure to retain vital documents in the case is disturbing. So Congress is right to continue to pursue questions. Impeachment, though, is almost certainly using a bazooka to kill a roach. At the least, Koskinen, who has offered a lifetime of public service and ethical behavior, deserves a chance to fully tell his side of the story.

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September 6, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

TaxProf Blog Holiday Weekend Roundup

Monday, September 5, 2016

The IRS Scandal, Day 1215

IRS Logo 2The Hill, House GOP Braces For Spending, IRS Fights:

House GOP leaders are preparing their members for fights over government funding and whether to impeach the commissioner of the Internal Revenue Service when Congress returns from its long summer recess. ...

Freedom Caucus members are pushing to vote on a resolution to impeach Koskinen, who they allege wasn't forthcoming with documents regarding the IRS's scrutiny of conservative nonprofits.

Reps. John Fleming (R-La.) and Tim Huelskamp (R-Kan.) introduced a "privileged" resolution on the House's last day of session before the recess to force a vote on impeachment. It's unclear if members of the Freedom Caucus would have to re-file the resolution, given that House rules state that privileged measures must be acted on within two legislative days.

GOP leaders have been wary of staging an impeachment vote, given that the House has only voted one other time in history to impeach a Cabinet official: Secretary of War William Belknap in 1876.

House Republicans' first conference meeting upon returning the day after Labor Day is expected to focus on strategy for the spending bill, with another on the IRS the following week.

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September 5, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Sunday, September 4, 2016

The IRS Scandal, Day 1214

IRS Logo 2Newsmax, IRS Chief Faces Likely Impeachment Vote in US House:

U.S. House conservatives are set to re-launch ... their effort to impeach Internal Revenue Service Commissioner John Koskinen, with or without Speaker Paul Ryan’s go-ahead.

Representative John Fleming says he and other conservatives are prepared to unilaterally force an impeachment vote within days after Congress returns to session on Sept. 6. “The only thing up in the air is whether it will be the first or second week we’re back,” the Louisiana Republican said in an interview.

Any action would be largely symbolic, because the effort would get blocked in the Senate if it passes the House. But Republicans remain angry at Koskinen, who they accuse of impeding an investigation into whether the tax agency improperly targeted conservative non-profits. Their allegations include failing to prevent the IRS from destroying evidence and providing false and misleading information to Congress.

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September 4, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Saturday, September 3, 2016

The IRS Scandal, Day 1213

IRS Logo 2Government Executive, IRS Chief Affirms That Agency Ended ‘Be on the Lookout’ Lists:

In the latest wrinkle in the controversy over the Internal Revenue Service’s alleged targeting of conservative groups, the tax agency’s chief has written to Congress [letter here] to assure lawmakers that its Exempt Organization’s division long ago discontinued use of so-called “Be on the Lookout” lists to sift through applications from nonprofits.

Earlier this month, a federal appeals court handling an ongoing case from the conservative group True the Vote zeroed in on the IRS’s use of the term “suspended” to describe the practice of flagging groups based on their names, overruling a lower court and restoring the suit against the agency.

On Aug. 18, Internal Revenue Commissioner John Koskinen sought to set the record straight in a letter to the chairman and ranking member of the Senate Finance Committee harking back several years to the multiple investigations of IRS’s allegedly biased processing of applications for tax-exempt status from groups claiming to be social welfare organizations.

“I want to be clear that no matter how you say it -- whether it's suspended, eliminated or ended -- the IRS stopped this practice long ago and is committed to never using such a list or process ever again,” Koskinen wrote, citing his own repeated testimony to Congress, his speeches and the reports from the Treasury Inspector General for Tax Administration saying the BOLO lists ended three years ago.

“The IRS and its leadership team have been, and remain, absolutely committed to avoiding any selection and further review of potential political cases based on names and policy positions,” he added. “There should be no doubt on this point, or regarding the continued, ongoing commitment by the IRS to be guided by the tax law and nothing else.”

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September 3, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (11)

Friday, September 2, 2016

The IRS Scandal, Day 1212

IRS Logo 2The Daily Caller, Real Power Behind IRS Conservative Targeting Scandal Still A Mystery:

An FBI investigation missed the IRS official who first set in motion the illegal targeting of conservative and tea party non-profit groups applying for tax exemption, documents obtained by a government watchdog group reveal.

An internal IRS document prohibited the targeted applicants from being approved automatically for tax exemption, and agency officials were told to send all such applications to the Orwellian-named Group 7822 to await additional guidance, FBI interviews obtained by Judicial Watch show.

It’s still unclear who authored the internal document that established Group 7822 and who ordered targeted applications be sent to Group 7822.

Disgraced IRS senior executive Lois Lerner has taken most of the heat since retiring from the federal tax agency, but the FBI investigation, which resulted in no prosecutions, suggested that Lerner didn’t write the internal guidance. It’s unclear if she had a role in creating Group 7822. ...

It’s unclear why the FBI did not press IRS officials on who was behind the BOLO and Group 7822. Judicial Watch did reveal, however, that a Department of Justice attorney who donated $6,750 to the Obama campaign and the Democratic National Committee spent more than 1,500 hours on the investigation.

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September 2, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Thursday, September 1, 2016

The IRS Scandal, Day 1211

IRS Logo 2Forbes: More Than 100 Law Professors To Congress: Impeaching The IRS Commissioner Is A Bad Idea, by Kelly Phillips Erb:

More than 100 tax law professors have sent a letter to House leaders in opposition to a resolution to impeach or censure Internal Revenue Service (IRS) Commissioner John Koskinen.

The letter was addressed to Speaker of the House Paul Ryan (R-WI); House Ways and Means Committee Chair Kevin Brady (R-TX); Minority Leader of the House Nancy Pelosi (D-CA); and House Ways and Means Committee Ranking Member Sander Levin (D-MI). The letter urged those Congressional leaders to “oppose any resolution to impeach or censure John Koskinen, the Commissioner of Internal Revenue.” ...

Censure is, of course, not as drastic as impeachment: it’s a public condemnation and requires a simple majority vote in the House and no action in the Senate. Impeaching an official requires a vote in the full House and, after a formal trial, a 2/3 vote of the Senate to remove the official from office. If that sounds like a high bar, it is: no agency official has been impeached in more than 140 years.

Tax Update Blog:  Profs For Koskinen, by Joe Kristan:

I favor censure because it’s clear that Koskinen has been, if you want to be charitable, tone-deaf to the implications of the IRS targeting of political opposition. He repeatedly has made statements on the investigation that have proven untrue, meaning he is either inept or a liar.

I oppose impeachment because it is a waste of time. The Senate would never convict.

I don’t like the letter because it completely ignores how Koskinen has completely lost the confidence of GOP Congressional appropriators. Nothing he has done provides them any reassurance that funding the IRS doesn’t mean funding their own opposition. If they really are concerned about the institutional integrity of the IRS, the professors should also call on Koskinen to resign in favor of somebody who can merit the respect of both parties.

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September 1, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (4)

Wednesday, August 31, 2016

The IRS Scandal, Day 1210

IRS Logo 2The Morning Call, Here's a Job for Lois Lerner:

There is no need for the taxpayers to bear the expense of a special prosecutor to investigate the Clinton Foundation. Lois Lerner can be asked to resume her position with respect to approval and oversight of nonprofits and foundations that have qualified under one of the IRS 501(c) classifications.

Lerner honed those skills when she copiously and intrusively examined the applications for recognition of tax-exempt status filed by conservative organizations. She might apply the same degree of intrusion and assertiveness toward the Clinton Foundation. Heck, she is drawing a taxpayer-financed pension so allow her skills to be applied with no additional expense to the taxpaying public. But then if questioned, will Lerner's emails (produced on taxpayer funded time) be lost or will the emails be forthcoming?

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August 31, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Tuesday, August 30, 2016

The IRS Scandal, Day 1209:  123 Tax Profs Oppose Impeachment/Censure Of John Koskinen

IRS Logo 2Letter From 123 Tax Professors in Opposition to Impeachment or Censure of IRS Commissioner (Aug. 28, 2016):

We the undersigned 123 tax law professors teach in law schools across America. We teach tax law and respect for the process of law in Utah, Montana, Texas, Georgia, Louisiana, Nevada, Florida, Pennsylvania and Ohio as well as in Massachusetts and Washington, D.C. and places in between.
We urge you to oppose any resolution to impeach or censure John Koskinen, the Commissioner of Internal Revenue.

We teach our students how to represent clients in positions adverse to the Internal Revenue Service, but we also teach our students respect for the law and for the IRS. The IRS carries out a vitally important mission for our country. Respect for the IRS fosters the voluntary compliance that is essential for our revenue system to work.

Impeachment or censure will harm the country by weakening our revenue system. Impeachment or censure would disrupt the functioning of the IRS—which has had four Commissioners in as many years—leading to increased tax evasion, reduced revenue collection, and a higher national debt. Impeachment or censure would also set a dangerous precedent and deter talented people from working to improve the country’s struggling revenue system.

We also fear that targeting Commissioner Koskinen will distract the Congress from the vital work of enacting meaningful tax reform. Academics, practitioners, and businesses agree that we must revise our revenue system to rationalize and simplify the rules, and to minimize the collateral costs of raising the necessary revenue.

We believe that nothing that has been reported provides any basis for impeachment or censure. Commissioner Koskinen was called out of retirement when the IRS needed help, and responded for the simple reason that it was the time for all good citizens to come to the aid of their country.

We respectfully request that the House reject misguided efforts to impeach or censure Commissioner Koskinen, and focus instead on enacting meaningful reforms to our revenue system.

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August 30, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (14)

Monday, August 29, 2016

Quantum Physics And The IRS Scandal, Day 1208

IRS Logo 2Fox News, Congress Faces Physicists' 'Multiverse' of Issues Including IRS, Zika Upon Impending Return:

Quantum physicists sometimes discuss the possibility of a “multiverse.” A multiverse is where the cosmos is like a layered quilt, populated with alternate realities, different dimensions and unique timelines. As a result, an infinite number of possibilities or scenarios pass along each temporal continuum.

Capitol Hill is now seemingly moored in a legislative multiverse. The House and Senate return to Washington in early September, following an epic, seven-week summer recess. There are only a handful of policy issues lawmakers must tackle when Congress reconvenes, but an almost incalculable string of outcomes loom ahead when they return.

In other words, almost anything can happen.

House Republican leaders conducted a half-hour conference call with rank-and-file GOPers late Thursday. According to sources familiar with the call, the Republican brass offered few specifics as to their approaches on big issues like funding the government, Zika and even an effort by House conservatives to impeach IRS Commissioner John Koskinen. ...

Just before the break in July, Huelskamp and Rep. John Fleming, R-La., filed a special resolution demanding that the House impeach IRS Commissioner John Koskinen. That resolution dissolved over the break.

Now, members of the House Freedom Caucus want to bring it back. Fox has learned the House won’t wrestle with the issue immediately as Freedom Caucus members will wait to see how the GOP leadership intends to handle the matter.

House Republican leaders aren’t fans of Koskinen. But they are lukewarm on impeaching the IRS chief. Congress hasn’t impeached a cabinet official since it sanctioned Secretary of War William Belknap in 1876.

As IRS commissioner, Koskinen isn’t even a cabinet official. There’s concern about setting a precedent if Congress begins impeaching various administration officials.

House Republicans will hold a separate conference meeting on Koskinen in mid-September. A source familiar with the thinking of the Freedom Caucus tells Fox its members aren’t in a hurry to refile the Koskinen resolution right away.

They don’t want to pressure leadership right off the bat. A House GOP leadership source told Fox that the public isn’t attuned to impeaching Koskinen. Still, the GOP leadership could further draw the ire of the Freedom Caucus if there isn’t a try to impeach Koskinen.

This is the Capitol Hill multiverse. No one is quite sure how lawmakers will resolve these issues in the end. But as lawmakers return to Washington, there are almost an infinite number of scenarios and possibilities -- because virtually no one’s decided anything yet.

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August 29, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Sunday, August 28, 2016

The IRS Scandal, Day 1207

IRS Logo 2Neil Buchanan (George Washington), How to Make a Dead IRS Conspiracy Theory Look Not Completely Dead:

How does a right-wing conspiracy theory work?  Why do Republicans insist on pursuing even obvious dead ends?  One answer to those questions is that they have a virtual army of people who are willing to push these stories relentlessly in many directions, and they know that they can sometimes get useful headlines even from misleading underlying stories.

Thus on Monday of this week we saw this headline on a tax blog: "The IRS Scandal, Day 1201: Larry Tribe Says 'IRS Is Engaged In Unconstitutional Discrimination Against Conservative Groups And Must Be Halted'—'Inexcusable Abuse'."

How did a liberal lion like Harvard law professor Laurence Tribe get pulled into this mess, seeming to back up a right-wing talking point? He did so by being intellectually open-minded and generous, but apparently without being aware of the underlying conspiracy theory that his words seemed to confirm. ...

More than three years on, conservatives are still trying to claim that there was a political conspiracy. Republicans in Congress have spent millions of dollars investigating these claims, while also diverting millions of dollars worth of IRS resources to answering repetitive requests for evidence.

Despite all of this, there continues to be no evidence to support any of the conspiracy theories.

So why is the story still alive, and how did Larry Tribe end up playing a starring role for a day in this never-ending saga?

Apparently, Tribe recently (correctly) dismissed the idea of an IRS scandal as a non-scandal that has been debunked. Because Tribe is among the most well-known liberal legal scholars in the country, as well as a former advisor to President Obama, he is regularly trolled by right-wingers. Apparently, one or more of them took to Twitter to tell Tribe that there really is an IRS scandal.

One such response pointed Tribe to a recent decision from the U.S. Court of Appeals for the D.C. Circuit. Because Tribe is intellectually honest and open to being corrected, he said that he would look at the evidence. What he found, upon reading the court's opinion, was that there had really been IRS activities that needed to be stopped. Like the IRS lawyers who had stopped the vetting program when they found out about it, Tribe was rightly shocked.

Which, of course, does not at all support the conspiracy theories that conservatives have been pushing. No one has ever claimed that the IRS employees did nothing wrong. That was all covered in the TIGTA report, and the IRS's leadership had already ended the practice before the report was issued.

But why would Tribe's tweet be in the present tense: "IRS Is Engaged In Unconstitutional Discrimination ..."? Is engaged, not was. Why did he say that the IRS "must be stopped," given that it has already stopped?

Tribe might simply have erred by not using the past tense, or he might not have realized that the activity had been stopped a long time ago.  Another explanation, however, is intriguing (though equally exculpating of Professor Tribe). ...

At this point, therefore, all the IRS has to do to make this case go away is to process the last two applications and issue a new directive putting a bureaucratic stake through the heart of the long-abandoned procedures.

This is, therefore, yet another example of how legal concepts can be misleading. Professor Tribe (assuming that he meant to use the present tense) correctly said that the IRS "is" still doing something wrong, but only in the procedural sense that the last of the effects of the wrongdoing have not been completely cleaned up and tied off.

In the broader political context, of course, the misunderstanding of this legal nuance is more than a bit unfortunate. An important public intellectual was directed toward one tiny bit of the public record on the IRS non-scandal, and he responded to that evidence appropriately. But his words are being misused by people who want to keep the anti-Obama scandal claims alive.

To repeat: Some IRS employees did something that they should not have done. Their superiors made them stop. An inspector general reported what happened to Congress. Republicans have no evidence to show that the Obama people were involved. And Laurence Tribe is rightly dismayed that it ever happened, as are we all.

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August 28, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (7)

Saturday, August 27, 2016

The IRS Scandal, Day 1206

IRS Logo 2Vox, How President Donald Trump Could Ruin His Enemies’ Lives:

Indulge for a minute in the worst-case scenario.

A Trump Force One flight to Mar-a-Lago in early January 2017. Donald J. Trump — the pettiest, most vicious version of Trump — is preparing for the ecstasies of his inauguration. He sits by the window, scrolling through Twitter and preparing for a well-deserved weekend at home.

Incoming White House Chief of Staff Corey Lewandowski and Chris Christie — yet to be named attorney general — burst into the cabin with a sheaf of notepaper and a couple of silent young attorneys in tow. "Well, boss," Lewandowski says, "we have a little bit of bad news and a whole lot of good news."

Trump raises an eyebrow. "There are some people we can’t figure out how to get back at yet, but there are a lot of people we can," Lewandowski says. ...

"Now on IRS — we’re doing Kasich and Cruz first, right?" (A nod from the president.) "We figure we just take the memo they sent out about targeting Tea Party groups and make some changes. Every group that’s ever done a fundraiser with those guys, or put up ads for them, or sent them an email, those are going to be audited first," Lewandowski says. "Bezos, we figure, probably next, maybe if the antitrust thing goes too slow. And we’re not allowing any new groups to get registered as 501(c)3s or (c)4s until we figure out who the rest of our targets are." ...

Because there are so many violations, the question of how investigators choose whom to target becomes the most important one. And the specter of politically motivated investigations is always there. This is most obvious when it comes to the IRS.

In 2013, the Treasury inspector general for tax administration found that the IRS had evaluated applications for new tax-exempt 501(c)3 groups, which can’t engage in "political activity," in part based on inappropriate things like whether a group had "Tea Party" in the name.

Conservatives felt this was evidence that the Obama administration was using the IRS to target conservative groups. Moulton of the Project on Government Oversight doesn’t think it quite reached the level of persecution — but still thinks the politically motivated use of the IRS, especially when it comes to tax audits, is a genuine cause for concern.

The government doesn’t even have to use all of these powers to change people’s behavior. Just the very possibility of an investigation is likely to make people tread carefully. Reporters sniffing around might worry about finding themselves snared in a costly audit. ...

In December, NBC and MSNBC correspondent Katy Tur live-tweeted a Trump rally that had been repeatedly disrupted by protesters. She received a note from Trump’s press secretary calling her coverage "disgraceful" and "not nice!" — followed by a tweet from Trump himself, calling for her and a colleague to be fired.

Then Trump singled her out at a rally in South Carolina, pointing to the press pen and saying, "She’s back there. Little Katy. … What a lie. Katy Tur. What a lie it was. Third. Rate. Reporter. Remember that."

Imagine that in 2017, Tur gets an audit request from the IRS for the past seven years of her tax information. She served as a foreign correspondent for NBC before covering the election, and the IRS sends her a letter every few weeks asking for more documentation about how she reported her income while on reporting trips abroad. ...

A vindictive president would need sympathetic political appointees in key positions: attorney general, DHS secretary, head of the IRS, maybe the director of National Intelligence. (The head of the FBI is a 10-year appointment, so James Comey — if he wants to — will be in charge until September 2023.)

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August 27, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Thursday, August 25, 2016

The IRS Scandal, Day 1204

IRS Logo 2New York Post editorial, A Liberal Legal Icon Condemns the IRS’ Abuses:

One of the leading liberal lights of American law now says the “IRS is engaged in unconstitutional discrimination against conservative groups and must be halted.”

To be clear, Harvard prof Laurence Tribe is a convert: Early in the week, he sent out a tweet dismissing the idea of an IRS scandal as long-debunked.

But, as the Cato Institute’s Walter Olson noted at Overlawyered, for once social media actually shed light on a dispute: Others asked Tribe to read this month’s DC Circuit Court of Appeals ruling against the IRS in the case — and he did.

That unanimous decision, reinstating lawsuits against the IRS for its targeting of righty groups, noted that there’s “little factual dispute” about the targeting and the “unequal treatment” of conservatives. More, it’s “plain . . . the IRS cannot defend its discriminatory conduct on the merits.”

Tribe read that, plus a key Inspector General report, and tweeted, “I confess error [with regard to] IRS ideological targeting. The IG report and the [DC Circuit] decision seems right to me. Inexcusable abuse.”

If a liberal icon can see the serious abuse, there’s hope for the House drive to impeach IRS chief John Koskinen for his scorched-earth defense of the cancer in his agency.

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August 25, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, August 24, 2016

The IRS Scandal, Day 1203

IRS Logo 2CDN, Trump Wants to ‘True the Vote’:

[S]tanding up for electoral integrity can get you noticed—in a bad way.

“My life before I spoke out for good government stands in stark contrast to the life I now lead,” says Catherine Engelbrecht, founder of the anti-voter fraud organization True the Vote.

In her 2014 testimony before the House Oversight and Government Reform Committee, she said:

“Shortly after filing IRS forms to establish 501 (c)(3) and 501 (c)(4), an assortment of federal entities including law enforcement agencies and a Congressman from Maryland [Democrat], Elijah Cummings came knocking at my door … my private businesses, my nonprofit organizations, and family have been subjected to more than 15 instances of audit or inquiry by federal agencies.”

Representative Cummings vehemently denied Engelbrecht’s charge, but subpoenaed emails from former IRS Exempt Organizations Director Lois Lerner showed that he and his staff did ask Lerner to give True the Vote extra special attention.

Lerner, like Clinton, never faced charges for mishandling sensitive information. Although ethics charges were filed against Cummings for “weaponizing government” on behalf of his party, nothing ever came of them.

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August 24, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Tuesday, August 23, 2016

The IRS Scandal, Day 1202

IRS Logo 2Roll Call, Freedom Caucus' Jordan Eyes Another Push to Oust IRS Chief:

Rep. Jim Jordan and other conservatives are reviving efforts to press the House to impeach IRS Commissioner John Koskinen as the embattled agency head tries to woo Democrats and undecided Republicans.

The Ohio Republican, chairman of the House Freedom Caucus, said in an interview that he and other allies were weighing the use of procedural tactics similar to the July bid by Louisiana GOP Rep. John Fleming to bring up an impeachment resolution as a privileged measure bypassing committee consideration. The measure calls for formal impeachment of Koskinen for misstatements and a failure to cooperate with a House investigation of the IRS' handling of tax-exempt status requests from conservative groups.

Congress didn't act on the measure before it left for a seven-week recess. And because the House did not take it up within two legislative days, Fleming would have to offer another one after Labor Day.

"We may have to bring that up again. We'll see," Jordan said. He said members of the Freedom Caucus and other conservatives would keep the pressure on Speaker Paul D. Ryan of Wisconsin and others in leadership to take action when Congress returns after Labor Day.

"We are committed to holding John Koskinen and the IRS accountable for what took place there. So, we can do that in a formal way, which is through hearings … and vote it out of the Judiciary Committee and move that direction, or we can look at going to the floor," Jordan said.

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August 23, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Monday, August 22, 2016

The IRS Scandal, Day 1201: Larry Tribe Says 'IRS Is Engaged In Unconstitutional Discrimination Against Conservative Groups And Must Be Halted'—'Inexcusable Abuse'

IRS Logo 2Overlawrered: Tweet of the Day: Laurence Tribe on IRS Ideological Targeting, by Walter Olson:

Yesterday Harvard law professor Larry Tribe sent out a tweet brusquely dismissing the IRS targeting episode as a debunked non-scandal. I and others promptly took issue with him, and pointed him toward the August 5 D.C. Circuit opinion laying out the scandal’s genuineness. (I also referenced my Ricochet article summarizing the decision and citing the Inspector General report from Treasury.)

Within an hour or two Prof. Tribe sent this tweet very graciously conceding error, along with several similar.

Tribe

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August 22, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (11)

Sunday, August 21, 2016

The IRS Scandal, Day 1200

IRS Logo 2Canada Free Press, Judicial Watch: IRS Buried Conservative Groups’ Tax-Exempt Applications:

Judicial Watch released more FBI documents demonstrating that the Obama administration deliberately slow-rolled the tax-exempt status applications filed by Tea Party and conservative groups, Truth Revolt reports.

From the start of 2010 and “lasting through the Obama reelection campaign in 2012, the IRS orchestrated a deliberate policy of burying conservative groups’ tax exemption applications in bureaucratic delays,” the watchdog group said.

Group 7822 was a place where applications were sent to gather dust.

Whenever Cincinnati IRS employees took in applications from right-leaning groups,  they were “automatically denied approval and assigned to a special ‘Group 7822’ for an extended ‘inventory’ process while waiting for decisions from IRS headquarters in Washington, DC.”

IRS employees were instructed to delay conservative and Tea Party applications until after President Obama was safely reelected in November 2012. “The strategy relied upon the IRS’ multi-tier “bucketing” system that determined from the time an application was received whether it would be quickly approved or indefinitely delayed,” the Judicial Watch report states.

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August 21, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Saturday, August 20, 2016

The IRS Scandal, Day 1199

IRS Logo 2Salt Lake City Tribune, Chaffetz Wants to Topple America’s Top Taxman, But Are His Motives Pure?:

The Salt Lake Tribune published an editorial recently that scolded Rep. Jason Chaffetz for trying to punish the IRS through the budgeting process because Commissioner John Koskinen won't resign.

The editorial noted that the Utah Republican, by suggesting budget-cutting threats to force Koskinen's hand, could hurt thousands of IRS employees and, by extension, the American people by diminishing the agency's efforts to collect unpaid taxes.

It also called Chaffetz's tactics a form of blackmail to force the commissioner's resignation. Chaffetz asserts that Koskinen should step down because he lied to the House Oversight and Government Reform Committee, which the Utahn heads, about the agency's targeting of conservative groups for audits.

The panel's ranking Democrat, Rep. Elijah Cummings of Maryland, has called Chaffetz's allegations against Koskinen false. And the Utahn's call for impeachment proceedingsagainst the IRS boss — a procedure almost unheard of for an agency head — seems to be going nowhere.

So Chaffetz is urging Koskinen to bow out for the good of the people and the agency. But I suspect a more sinister motive is at play.

The four-term Utah congressman wants to add to his trophy case, much like the hunters who pay guides thousands of dollars to help them gun down exotic animals so they than can mount heads on their walls.

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August 20, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Friday, August 19, 2016

The IRS Scandal, Day 1198

IRS Logo 2Washington Times, IRS Vows Action on Tea Party Applications Long Held Up by Targeting:

Under pressure from the federal courts, the IRS did an abrupt about-face this week and said it will finally begin processing some of the tea party applications it has blocked for years — but the agency still refuses to say what the new process will be.

The Texas Patriots Tea Party, which first applied for tax-exempt status more than four years ago and has been blocked ever since, received a notice from the Justice Department on Tuesday saying it is finally going to see some action.

But the department’s attorney, Joseph A. Sergi, said he didn’t have any more details to provide, leaving it unclear whether the agency will move quickly, what sorts of standards it will impose and whether it will require another round of questions for the groups to answer.

“The IRS has decided that it will process the applications of plaintiffs whose applications remain outstanding, including the application for We the People of Texas (Texas Patriots Tea Party). We will be in further contact regarding the application process once we have heard from the IRS,” Mr. Sergi said in a brief note to the tea party group’s attorney.

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August 19, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Thursday, August 18, 2016

The IRS Scandal, Day 1197

IRS Logo 2Forbes: Prediction: Clinton Foundation Will Pass IRS Investigation Just Fine, by Robert W. Wood:

After considerable prodding, the IRS has said—seemingly begrudgingly—that it is looking into the Clinton Foundation. Even before the latest email revelations, Republicans have criticized the Foundation and the unparalleled access they say donors have had to government policymakers. The unsavory “pay to play” label has often been used to describe the Foundation headed by a former President and Secretary of State. House Republicans formally asked the IRS to review whether the Clinton Foundation is complying with the rules governing its tax-exempt status.

More recently, Judicial Watch released a new batch of State Department emails showing close and sometimes overlapping interests between the Clinton Foundation and the State Department while Hillary Clinton served as Secretary of State. The documents raise new questions about whether the Clinton Foundation ever rewarded donors with access and influence at the State Department. It is a charge Mrs. Clinton has faced in the past, and has always denied. Judicial Watch President Tom Filton said in a press release that Clinton “hid” the emails on purpose. ...

The newly released emails give new impetus to Republican requests to audit the Clinton Foundation. IRS Commissioner Koskinen wrote that the IRS was looking into it. Mr. Koskinen is the same IRS official Republicans have been trying to impeach over the IRS targeting scandal. Mr. Koskinen denies any wrongdoing. As discussed here, Rep. Marsha Blackburn (R-TN), lead the push for the IRS to investigate. One of the complaints dates to the Peter Schweizer book, “Clinton Cash.” It says that Hillary’s State Department funneled at least $55 million to Laureate Education Inc. Laureate donated between $1 million and $5 million to the Clinton Foundation. ...

[I]t seems hard to imagine that this Foundation will face serious scrutiny. Even if there is official criticism, it will surely come post-election. Some questions relate to pay to play donations said to facilitate access to Mrs. Clinton. Moreover, there have long been complaints that the Clintons have not defined how they decide to designate speaking fees as their own income or as assigned to the Foundation. The tax system generally does not allow that kind of choice without tax consequences. In any event, the part of the IRS investigating the Clinton Foundation is the Exempt Organizations Division, the unit formerly run by Lois Lerner. She took the Fifth, retired and faced no charges over the targeting of conservative organizations.

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August 18, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (5)

Wednesday, August 17, 2016

The IRS Scandal, Day 1196

IRS Logo 2Breitbart, ‘The Intimidation Game’: IRS Scandal Looms over Next Administration:

In June, Hillary Clinton warned that Donald Trump was a would-be dictator who could not be trusted with the powers of the presidency. “Imagine if he had not just Twitter and cable news to go after his critics and opponents, but also the IRS, or for that matter our entire military,” she said. “Given what we have seen and heard, do any of us think he’d be restrained?”

How ironic, given that she served in the Obama administration while it abused the powers of the IRS to target conservative groups. ...

Hillary can be expected to pass some version of the DISCLOSE Act, a Democratic Party initiative to flush out the political views of federal contractors, and could revive proposed IRS regulations that would effectively legalize the targeting that was done in the IRS scandal.

Trump has been combative with the press, but there is nothing to suggest that he would pursue, or sanction, the kinds of abuse that Hillary Clinton and her party have been eager to encourage in the recent past. In fact, only a Trump presidency holds out the possibility of bringing the perpetrators of the IRS scandal to justice. In contrast, a Clinton win could see a renewed effort to target conservatives for the “crime” of dissent.

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August 17, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Tuesday, August 16, 2016

The IRS Scandal, Day 1195

IRS Logo 2WCPO (Cincinnati), Tea Party Federal Lawsuit Against IRS Set for 2017:

A tea party lawsuit brought by a group in California against the Internal Revenue Service over alleged targeting won't go to trial in Cincinnati until late 2017.

U.S. District Judge Michael Barrett recently set out a schedule for evidence preparation and disclosures in the case, with a final pretrial conference set for September 2017, and a trial scheduled for November 2017.

The 2013 class-action lawsuit filed by NorCal Tea Party Patriots of California alleges violations of privacy laws and constitutional rights.

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August 16, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Monday, August 15, 2016

The IRS Scandal, Day 1194

IRS Logo 2Daily Caller, IRS Bench Slapped Over Targeting Practices:

D.C. Circuit Scolds IRS For Unfair Targeting Practices
The U.S. Court of Appeals for the D.C. Circuit found that the IRS systematically targeted conservative groups for additional scrutiny by delaying their applications for tax-exempt status and submitting the groups to invasive probes, like forfeiting internet usernames and passwords or reviewing the political and charitable activities of family members. The three-judge panel characterized the agency’s arguments in its defense as “puzzling,” rejecting their claim that the agency could not process the tax-exempt applications of groups party to the litigation. Since the D.C. Circuit was not convinced IRS targeting had ceased, it reversed a lower court ruling denying the conservative groups an injunction and remanded the case for further proceedings.

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August 15, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Sunday, August 14, 2016

The IRS Scandal, Day 1193

IRS Logo 2USA Today, Conservatives Want to Force House Vote to Impeach IRS Chief:

When Congress returns next month from its seven-week recess, conservative rebels in the House vow to force a vote on whether to impeach IRS Commissioner John Koskinen, effectively making an end-run around reluctant House leaders to achieve their goal.

Republicans allege that Koskinen obstructed an investigation into whether the IRS improperly scrutinized conservative Tea Party groups seeking tax-exempt status, although they do not agree on whether the IRS chief should be impeached. Democrats have denounced impeachment efforts against Koskinen as a politically motivated "travesty" that defames an honorable public servant who has done nothing wrong.

"John Koskinen needs to go, and we are committed to that," Rep. Jim Jordan, R-Ohio, chairman of the ultraconservative House Freedom Caucus, said in an interview with USA TODAY.

Although House leaders usually set the agenda, Jordan and other Freedom Caucus members are using a procedural tactic called a "privileged resolution" to force an impeachment vote. They can force the vote two days after they file the resolution.

A resolution filed by caucus members before the congressional recess has expired, but Jordan said they are poised to file it again when Congress reconvenes. Lawmakers are set to return on Sept. 6. ...

Jordan said the caucus has been buoyed by an Aug. 5 decision by a federal appeals court that said the IRS has not proven that it has ended discriminatory practices against conservative groups. The U.S. Court of Appeals for the District of Columbia Circuit reinstated a lawsuit against the agency. "The court just said that the IRS may not have cleaned up its act at all," Jordan said.

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August 14, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Saturday, August 13, 2016

The IRS Scandal, Day 1192

IRS Logo 2Daily Signal, Accountability for IRS? What’s Next After New Court Decision:

The IRS has not stopped targeting conservative groups seeking nonprofit status, a federal appeals court has ruled in deciding to reinstate a lawsuit against the agency.

The U.S. Court of Appeals for the District of Columbia Circuit overturned a decision by a lower court that threw out the lawsuit because the Internal Revenue Service had promised voluntarily to end discriminatory practices.

The IRS insisted “there is no reasonable expectation” that discrimination will reoccur, the ruling noted, because the tax agency has “suspended until further notice” tactics it used to target the applications of tea party and other conservative groups for nonprofit status.

That reassurance was unsatisfactory to the appeals court because it appeared temporary. “There is a difference between the controversy having gone away and simply being in a restive stage,” Senior Judge David B. Sentelle, who was appointed by President Ronald Reagan, wrote in a unanimous decision by a three-judge panel. As a result, Sentelle wrote in the opinion released Friday, citing case law, the IRS “is free to return to [its] old ways—thereby subjecting the plaintiff to the same harm, but, at the same time, avoiding judicial review.”

Conservatives greeted the decision as proof that the tax agency isn’t serious about cleaning up its act. “They only stopped the targeting while people were paying attention. They had no intention of stopping the illegal conduct altogether,” lawyer John Eastman told The Daily Signal. ...

While the federal appeals court declined to hold individuals inside the IRS personally responsible for damages, it did agree with Eastman’s argument that political discrimination inside the agency was an ongoing problem. Any suggestion that the IRS no longer targets conservative groups, Sentelle wrote, “is absurd” in light of the fact that “two of the appellant-plaintiff’s applications remain pending.” ...

Conservatives celebrated the decision, which remanded the lawsuit to a lower court for trial and makes possible further discovery, a pretrial procedure that allows plaintiffs to search for additional pertinent information. ... In his interview with The Daily Signal, Eastman, former dean of Chapman University School of Law in Orange, California, predicted the discovery will unearth new facts about the IRS that are “going to be even more explosive than anything we’ve seen so far.”

Plaintiffs would look for evidence of collusion among government agencies, Eastman explained. It would be illegal, for example, if the IRS shared information about conservative nonprofits with the FBI for additional review.

That’s within the realm of possibility, Eastman said, considering the experience of Catherine Engelbrecht, founder and president of True the Vote. After her organization, which aims to curb voter fraud, applied for nonprofit status in 2010, Engelbrecht told The Daily Signal, she came under investigation by three government agencies all at once. As first reported by National Review in 2013, the IRS requested she turn over every social media post she’d ever written, lists of political organizations she has addressed, and information on any family members interested in running for public office.

Engelbrecht and her family’s business became the target of probes by the Bureau of Alcohol, Tobacco, Firearms, and Explosives and the Occupational Safety and Health Administration as well as the FBI. If any evidence of collusion exists among these agencies, Eastman told The Daily Signal, government employees involved could face “serious, five-years-in-prison types of felonies.”

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August 13, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)

Friday, August 12, 2016

The IRS Scandal, Day 1191

IRS Logo 2Investor's Business Daily editorial, Will Predatory IRS Finally Be Brought To Justice?:

The Law: Two months ago, it looked as if the IRS scandal over targeting conservative groups had reached a legal dead end. But an appeals court, in a stunning reversal, revived it this week. Will justice finally be done?

We hope so.

The Washington, D.C., Circuit Court, overturning a June lower-court decision, let the suit go forward because, as LSU law professor Philip Hackney noted in the Surly Subgroup blog, "it found that the IRS had not voluntarily ceased its unlawful actions."

In other words, the IRS is still doing what it was accused of in the first place and was supposed to halt.

In particular, the court reinstated two specific complaints made by True The Vote and other Tea Party groups that claimed the IRS had acted in a biased way toward conservative organizations that applied for tax-exempt status.

The two complaints were that the IRS had violated the group's First Amendment rights, and that it had also violated the Administrative Procedures Act — both serious complaints that could land people in jail.

Senior Judge David B. Sentelle was particularly scathing in writing the unanimous decision by a three-judge panel, calling the IRS' contention that it was no longer violating the conservative groups' rights "absurd." ...

The egregious use of a powerful arm of the federal government for explicitly political purposes should never be tolerated. It's the stuff of petty dictatorships, more suitable to a government run by Turkey's Erdogan or Venezuela's Maduro than to a great republic such as the U.S.

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August 12, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Thursday, August 11, 2016

The IRS Scandal, Day 1190

IRS Logo 2American Center for Law and Justice, President Obama’s IRS Scandal: Seven Years & Counting:

As we continue to bring you analysis this week of our recent win in the IRS case, we are reminded of how much this issue has developed since it was first discovered.

To be clear – the Obama Administration’s IRS targeting of Tea Party and other grassroots conservative groups is one of the longest running scandals in President Obama’s nearly eight-year administration – and it is still ongoing. After nearly seven years this December, one of our clients has still not received a determination on their submitted tax-exempt application.

In full disclosure, a proper and thorough timeline of this scandal would take thousands of pages to fully discuss everything that has occurred to date. For example, one law professor, in particular, has kept a daily blog for years now following the scandal and he just published “The IRS Scandal, Day 1188” earlier this week.

While we cannot cover every development of this scandal, the following timeline provides a clear and concise review of the major developments along the way:

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August 11, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Wednesday, August 10, 2016

The IRS Scandal, Day 1189

IRS Logo 2The Surly Subgroup:  DC Circuit Seems to have Decided IRS Violated Constitution Before Trial in True the Vote Appeal, by Philip Hackney (LSU):

In 2014, a District Court dismissed (based on 12(b)(6) and 12(b)(1) motions) the complaint of a number of conservative organizations who alleged that the IRS “targeted” them by subjecting them to greater scrutiny in their applications for tax exemption. The lead organization, True the Vote, sought 501(c)(3) charitable organization status; the others primarily sought 501(c)(4) social welfare organization status. The world became aware of this targeting controversy in May 2013 when Lois Lerner, the head of the Exempt Organizations division of the IRS apologized to the Tea Party and other conservative groups for how the IRS treated their applications. To this day Taxprof Blog continues the IRS Scandal post over three years later dedicated at least in part to this controversy.

The primary complaints were the second and fifth claims:  (2) the IRS violated the organizations First Amendment rights to freedom of speech, and (5) the IRS violated the Administrative Procedures Act. The District Court concluded that because the IRS had granted exempt status to these organizations, the complaints were moot. True the Vote appealed this dismissal to the DC Circuit Court of Appeals.

Last week the Circuit Court breathed new life into claims 2 and 5. Though the Court found that some of the complaints were moot (including Bivens complaints against IRS employees and a claim of violation of 6103 disclosure rules), it allowed claims 2 and 5 forward because it found that the IRS had not voluntarily ceased its unlawful actions.

In reading the opinion, I find astonishing that the Circuit Court appears to have already concluded, without trial, that the IRS acted unconstitutionally. I recognize that for a 12(b)(1) motion the court is to assume the complaint true, but the court appears to have done much more than make assumptions. I focus on this issue.

Frankly a trial testing this situation seems to me the right thing for two reasons. First, many people in our country genuinely believe the IRS behaved unconstitutionally (as is evidenced by the continuing coverage given in places like Taxprof Blog). Second, the IRS failed numerous organizations in how it processed this group of applications that touched on First Amendment issues. These two factors suggest to me that the organizations involved deserve a real hearing and not just a pre-trial dismissal.

What worries me is that the DC Circuit Court judges appear to have already judged the case; I find that as problematic as what the DC Circuit Court judges find problematic in the IRS actions at issue. Remember, the issue before the appeals court is a 12(b)(1) motion to dismiss for lack of subject matter jurisdiction because the IRS had approved the applications for tax exemption and there was no case to be decided by the court. Thus, no one has presented evidence or law in a trial on the substantive issues before the court. The court is to take the allegations as true for purposes of the motion but should give those claims close scrutiny. The DC Circuit though seems to do much more than assume the complaint is true.

The court starts its opinion stating: “Instead of processing these applications in the normal course of IRS business, as would have been the case with other taxpayers, the IRS selected out these applicants for more rigorous review on the basis of their names, which were in each instance indicative of a conservative or anti-Administration orientation.” Later in the opinion it continues: “It being plain to the Inspector General, the district court, and this court that the IRS cannot defend its discriminatory conduct on the merits, the governing issue is now whether the controversy is moot.” There is a lot of nonsense in those statements.

Because I don’t believe that the IRS failed by using names to screen applicants nor in picking out the conservative groups’ applications for closer scrutiny (as I discussed in an article called Should the IRS Never ‘Target’ Taxpayers), and I don’t believe any credible evidence has been put forward establishing that IRS employees acted with any intent to harm conservative causes, I feel like I am living in bizarro world to read a US appeals court opinion that states without a trial fairly establishing the law and facts that the these actions violated the constitution. I will take a look at separate parts of the statements to explain what I mean. ...

Perhaps the court’s opinion is nothing but dicta except for the holding that the case is not moot. But it is not at all clear that this is the way this opinion will be used. It is fine if the DC Circuit Court wants to see this case go forward, but it should let this case go forward without judging the case before it hears any evidence or law in a trial. The IRS, just like the conservative organizations, deserves to be treated with respect and fairness.

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August 10, 2016 in IRS News, IRS Scandal, Tax | Permalink | Comments (6)