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Editor: Paul L. Caron
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Monday, June 9, 2014

The IRS Scandal, Day 396

Sunday, June 8, 2014

The IRS Scandal, Day 395

Saturday, June 7, 2014

The IRS Scandal, Day 394

IRS Logo 2The Jersualem Post editorial:   Z Street and the IRS:

The Z Street case may be what forces the IRS to pull aside its carefully constructed curtain and reveal how it made decisions regarding organizations deemed out of step with the current US administration

Last spring, the US media were filled with accusations that the IRS was using its power over nonprofits to stifle opposition to the Obama administration.

While congressional efforts to investigate the alleged wrongdoings have been stymied, a decision by a federal judge in Washington may force the IRS to disclose whether a small, staunchly pro-Israel group was victimized.

Judge Ketanji Brown Jackson of the US District Court for the District of Columbia threw out every legal defense the IRS raised in Z Street v. Koskinen, IRS Commissioner. She ordered the IRS to provide a substantive answer to Z Street’s complaint by June 26.

Z Street brought its lawsuit for viewpoint discrimination after, it alleges, the IRS agent to whom the organization’s file had been assigned said Z Street’s application for tax exemption might take a long time to process because the IRS “has to give special scrutiny to organizations connected to Israel,” and that the files of some of those applicants “will be sent to a special unit in Washington to determine whether the activities of the organization contradict the public policies of the administration.”

If borne out by the evidence, this would be an astounding violation of free speech rights.

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June 7, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, June 6, 2014

The IRS Scandal, Day 393

IRS Logo 2New York Post editorial, Schumer’s IRS:

Did Chuck Schumer try to use the IRS to sidestep the Supreme Court’s Citizens United ruling — and stick a dagger in the heart of conservative groups? That’s the gist of a complaint filed this week with the Senate Select Committee on Ethics. ...

The complaint notes Schumer signed letters asking the IRS if it was investigating “social welfare organizations” to see if they were improperly campaigning. Turns out the IRS did investigate. And — surprise! — almost all the groups singled out for special IRS scrutiny were conservative.

It also points to a Schumer speech made earlier this year called “The Rise of the Tea Party and How Progressives Can Fight Back.” The speech, says the complaint, explains how the IRS could be a tool “to stamp out Tea Party organizations.”

Up to now, the press has not regarded the clear and deliberate IRS targeting of conservative organizations as a scandal, because it’s found no evidence it was ordered by the White House. If the Center for Competitive Politics is right, maybe the media should start looking at the Senate.m. 

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June 6, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Thursday, June 5, 2014

The IRS Scandal, Day 392

IRS Logo 2Washington Post:  The Rhythm of a Federal Scandal, by Tom Hicks:

Federal scandals tend to share certain common characteristics, especially with the way they play out. Let’s review some recent examples of government misconduct to understand the trends.

As case studies, we’ll use the the cover-ups of treatment delays at Veterans Affairs hospitals, the Internal Revenue Service’s targeting of conservative groups and the General Service Administration’s lavish training conference in Las Vegas. 

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June 5, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, June 4, 2014

The IRS Scandal, Day 391

IRS Logo 2The Hill, Conservative Group Accuses Nine Dem Senators of Unethical Conduct:

A conservative group is calling on the Senate ethics committee to examine nine top Democrats, accusing them of pushing the IRS to investigate specific groups.

The Center for Competitive Politicsannounced their complaint Tuesday, in which they charge that lawmakers tried to get the tax agency to probe outside conservative groups.

“These senators improperly attempted to use the IRS to suppress the free speech of American citizens for their party’s electoral gain,” said Brad Smith, chairman of the Center and a former Chairman of the Federal Election Commission. “We will fight this type of abuse of power and work to ensure that those who have violated Senate Ethics rules are held to account.”

The group wants the ethics panel to look at Sens. Dick Durbin (Ill.), Chuck Schumer (N.Y.), Carl Levin (Mich.), Michael Bennet (Colo.), Sheldon Whitehouse (R.I.), Jeanne Shaheen (N.H.), Al Franken (Minn.), Jeff Merkley (Ore.), and Tom Udall (N.M.).

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June 4, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, June 3, 2014

IRS Releases Spring 2014 SOI Bulletin

SOIThe IRS's Statistics of Income Division has released (IR-2014-69) the Spring 2014 SOI Bulletin (Vol. 33, No. 4), with these articles:

June 3, 2014 in IRS News, Tax | Permalink | Comments (0)

Monday, June 2, 2014

Jones: The IRS Should Reevaluate its Floundering ADR Program

Tax Analysys Logo (2013)Ken Jones (Sutherland Asbill & Brennan, Washington, D.C.), Appeals Arbitration: Not a Compelling Litigation Alternative, 143 Tax Notes 1059 (June 2, 2014):

IRS Appeals announced its initial arbitration program in 2000, and after 14 years, there apparently have been only a few cases resolved by binding arbitration. Appeals arbitration has failed to become popular in the tax controversy marketplace, and there are some likely reasons for the program's lack of success. ... I offer my observations about the arbitration program, why it has not been embraced by taxpayers as a viable alternative to litigation, and why Appeals should reevaluate the role of binding arbitration -- and, indeed, all of its alternative dispute resolution (ADR) tools -- to determine whether they are meeting the needs of the taxpayers and the IRS.

June 2, 2014 in IRS News, Scholarship, Tax, Tax Analysts | Permalink | Comments (0)

The IRS Scandal, Day 389

IRS Logo 2Thiago Sorrentino was kind enough to let me know that the Supreme Court of Brazil (the Supremo Tribunal Federal) has cited my daily roundup on the IRS Scandal in Medida Cautelar NA Susepnsao De Tutela Antecipada (STA/752):

Without revealing transparency of the criteria for application of the tax rules , the appeal of the State to protect free enterprise and fair competition declines to a cognitive framework of uncertainty , as that on which the fiscalizatórios thorough review procedures of the Internal Revenue Service U.S. , due to the selectivity of legal interpretation as non- legal criteria ( see, for all the record that Prof. . Caron Paul does in http://taxprof.typepad.com/taxprof_blog/2014/05/the-irs-scandal- 17.html ); In these terms , the argument would only be permissible risk to free enterprise and fair competition that each taxpayer could realize the full control of the criteria used to apply tax rules , both those that define the tax burden as those that effectively prohibit the exercise of activity economic lawful. Given these caveats, impart pled measure to suspend the company - interested in the records of Action to advance protection 

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June 2, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Sunday, June 1, 2014

The IRS Scandal, Day 388

Saturday, May 31, 2014

The IRS Scandal, Day 387

IRS Logo 2Forbes: Did IRS Target Israel? Suit By Pro-Israel Z Street Will Move Forward, by Peter J. Reilly:

This lawsuit much like Teapartygate confirms me in my view, that the evaluation of whether an organization's purposes should allow it exempt status is not something that the IRS should be doing. There are credits for historic buildings, but it is not the IRS that decides whether the buildings are historic. The same principle should apply here.

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May 31, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, May 30, 2014

IRS Eyes New Ways to Tax Frequent Flyer Miles

New York Sun:  IRS Eyes New Ways to Tax Miles of Frequent Fliers, by Ira Stoll:

Just in time for your summer vacation, the IRS is getting ready to toughen the tax treatment on frequent flyer miles and hotel loyalty reward programs.

The IRS announced in 2002 that it wouldn’t try to go after individuals for income taxes on frequent flyer miles or hotel loyalty points earned on company-paid business trips.  Yet the temptation to wring some tax revenue out of the vast non-dollar economy of Starwood Preferred Guest Starpoints, Marriott Rewards points, American Airlines AAdvantage miles, Delta Skymiles, and so on is apparently so great that that the government just cannot resist.

Sure enough, the Tax Foundation, a research group that tracks tax issues, flags a recent post on the View From the Wing blog that runs under the provocative headline, “The IRS Looks To Be on the Verge of Imposing a Big Tax Burden on Loyalty Points.”

The IRS’s plans are vague, but they have airlines and hotel owners concerned enough about the issue that they reportedly sent a letter to Treasury Secretary Jacob Lew. “The IRS’ proposal to alter the tax treatment of loyalty programs will impose a significant new tax on existing and future loyalty points that travel customers enjoy and rely upon,” said the letter, according to a report in Politico. “Any change or clarification of loyalty program accounting should be made through the legislative process, not IRS promulgation.”

Frequent flyer mile fanatics got a wake-up call on the issue back in 2012 when Citibank sent IRS Forms 1099, documenting “miscellaneous income,” at a rate of 2.5 cents a mile, to customers who had signed up for an American Airlines-branded credit card and gotten 40,000 AAdvantage miles as a bonus. It was an unpleasant surprise to cardholders who thought they were getting a free trip, not an unwanted extra tax bill.

May 30, 2014 in IRS News, Tax | Permalink | Comments (1)

The IRS Scandal, Day 386

IRS Logo 2Commentary:  Phony Scandal? Courts Open Window on the IRS’s Political Litmus Tests, by Jonathan S. Tobin:

Interest in the Internal Revenue Service’s outrageous practice of subjecting politically conservative groups to discriminatory treatment has died down a bit since the revelations about this scandal first hit the news a year ago. But a court decision that was handed down earlier this week about a similar instance of potential government misconduct may shed more light on the way the Tea Party and other right-wing organizations were given the business by Lois Lerner and the rest of what appears to be a highly politicized bureaucracy at the heart of our tax collection system. ...

In other words, this case may be the straw that breaks the camel’s back of the IRS’s politically prejudicial policies. If an IRS agent can reject or stall a pro-Israel group’s application on the grounds that “these cases are being sent to a special unit in the D.C. office to determine whether the organization’s activities contradict the Administration’s public policies,” then no group, no matter what its political orientation or cause is safe from being subjected to a political litmus test designed by any administration of either political party. ...

Using the IRS to punish political foes is blatantly illegal. If, as we suspect, the Z Street case reveals the sort of internal email traffic that will reveal how widespread this practice has become in the last five years, perhaps even a liberal mainstream press that still thinks the problems at the IRS are a “phony scandal” will start to pay attention.

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May 30, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Thursday, May 29, 2014

The IRS Scandal, Day 385

IRS Logo 2Wall Street Journal editorial:  IRS Judgment Day: The Untalkative Agency Comes Under Scrutiny From a Federal Judge:

The IRS continues to evade questions about its handling of applications for tax-exempt status from groups whose political views conflicted with the Obama Administration's. That may change. A federal judge's ruling will force the agency to defend itself in court and go through discovery on its handling of a slow-tracked application.

In 2009 a Pennsylvania group called Z Street applied to the IRS for tax-exempt status for its mission of educating people about Zionism and other policies related to Israel and the Middle East. In May 2010 the group received a request from the IRS for more information, which it sent. According to Z Street's complaint, two months later the agent in charge of reviewing the application told Z Street's counsel she was holding up the application because of her concerns that the group engaged in advocacy related to the Middle East. 

According to the complaint, Agent Diane Gentry said that special attention was given to Israel-related groups and that "these cases are being sent to a special unit in the D.C. office to determine whether the organization's activities contradict the Administration's public policies." We've since learned that the agency's November 2010 "Be On the Lookout" list also flagged agents to look out for words related to Israel or "inflammatory" references to "disputed territories." ...

This ruling will force the IRS to open its books on the procedures it used and decisions it made reviewing Z Street's tax-exempt application, procedures it has tried to keep shrouded. As the case proceeds, Z Street's attorneys can seek depositions from many who have been part of the larger attempt to sit on similar applications by other conservative groups.

It will be fascinating to see which names— Lois Lerner, former head of IRS tax-exempt scrutiny?—show up in the internal email traffic. The Administration may have a harder time evading accountability now that a judge will be supervising the testimony.

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May 29, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, May 28, 2014

The IRS Scandal, Day 384

IRS Logo 2Government Executive:  Justice Fires Back at Issa on Testimony Over IRS Probe:

Tuesday, May 27, was the day the Justice Department was supposed to produce a key prosecutor to testify to staff on a House panel probing alleged political favoritism at the Internal Revenue Service.

But that was according to a May 22 letter sent to Attorney General Eric Holder by House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., who is concerned about what he sees as improper coordination between IRS and Justice in deciding which groups to investigate for possible campaign finance law violations.

As of publication time May 27, there was no scheduled appearance by Jack Smith, chief of Justice’s Public Integrity Section, and no updated comment from the department or Issa’s panel.

What did emerge on Tuesday was a letter from Justice explaining its procedures and reasoning on questions of testifying to Congress. It comes as the latest wrinkle in the year-old controversy over IRS efforts to single out for extra scrutiny certain nonprofit groups applying for tax-exempt status

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May 28, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, May 27, 2014

NY Times: IRS Bars Employers From Dumping Workers Into Health Exchanges

New York Times:  IRS Bars Employers From Dumping Workers Into Health Exchanges:

Many employers had thought they could shift health costs to the government by sending their employees to a health insurance exchange with a tax-free contribution of cash to help pay premiums, but the Obama administration has squelched the idea in a new ruling. Such arrangements do not satisfy the health care law, the administration said, and employers may be subject to a tax penalty of $100 a day — or $36,500 a year — for each employee who goes into the individual marketplace.

The ruling this month, by the IRS, blocks any wholesale move by employers to dump employees into the exchanges.

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May 27, 2014 in IRS News, Tax | Permalink | Comments (1)

The IRS Scandal, Day 383

Monday, May 26, 2014

The IRS Scandal, Day 382

Sunday, May 25, 2014

The IRS Scandal, Day 381

Saturday, May 24, 2014

The IRS Scandal, Day 380

IRS Logo 2House Committee on Oversight & Government Reform, Testimony: In 2010, Justice Department Sought Lois Lerner’s Help to Prosecute Tax Exempt Groups Engaging in Politics:

House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., and Subcommittee on Economic Growth, Job Creation and Regulatory Affairs Chairman Jim Jordan, R-Ohio, today requested that the Department of Justice make DOJ Public Integrity Section Chief Jack Smith available for a transcribed interview. The request comes after Smith’s subordinate, Director of DOJ’s Election Crimes Branch, Richard Pilger, told Committee investigators in a transcribed interview that the Justice Department met with Lois Lerner in October 2010, two and a half years earlier than previously known, to discuss potential criminal enforcement relating to political speech of nonprofit groups in the wake of the Supreme Court’s Citizens United decision.

“The Committee’s transcribed interview of Richard Pilger presents further troubling information about the Department’s contemplated prosecution of nonprofit groups for false statements,” Chairman Issa and Chairman Jordan state in the letter.  “It is apparent that the Department’s leadership, including Public Integrity Section Chief Jack Smith, was closely involved in engaging with the IRS in wake of Citizens United and political pressure from prominent Democrats to address perceived problems with the decision.”

“According to Mr. Pilger,” the letter continues, “the Justice Department convened a meeting with former IRS official Lois Lerner in October 2010 to discuss how the IRS could assist in the criminal enforcement of campaign-finance laws against politically active nonprofits.  This meeting was arranged at the direction of Public Integrity Section Chief Jack Smith.”

The meeting occurred days before Lois Lerner spoke at a Duke University event about the immense political pressure on the IRS to “fix the problem” created by Citizens United before the 2010 midterm election.

Earlier this week, Chairman Issa issued a subpoena after Pilger declined to answer critical questions on the instructions of a Justice Department lawyer during a transcribed interview on May 6, 2014.  The subpoena followed an April 23, 2014 letter from 17 Members of the Committee requesting materials concerning the Department’s involvement in efforts to scrutinize tax-exempt applicants after emails surfaced between Pilger and the Internal Revenue Service’s Lois Lerner where they discussed singling out and prosecuting tax-exempt applicants, at the urging of a Democratic Senator.

Letter embedded below.

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May 24, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Friday, May 23, 2014

The IRS Scandal, Day 379

IRS Logo 2IRS Update on the Proposed New Regulation on 501(c)(4) Organizations:

Last November, Treasury and the IRS proposed a new regulation governing political activity of section 501(c)(4) organizations. The proposal generated over 150,000 written comments — the most comments ever received by Treasury and IRS on a proposed tax regulation. Consistent with our standard rulemaking process, we intend to review those comments carefully, take into account public feedback, and consider any necessary changes. Consistent with what Commissioner Koskinen has previously stated, it is likely that we will make some changes to the proposed regulation in light of the comments we have received. Given the diversity of views expressed and the volume of substantive input, we have concluded that it would be more efficient and useful to hold a public hearing after we publish the revised proposed regulation. Treasury and the IRS remain committed to providing updated standards for tax-exemption that are fair, clear, and easier to administer.

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May 23, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, May 22, 2014

318,000 Federal Workers Owe $3.3 Billion in Back Taxes (Delinquency Rate Is 33% Higher Among VA Employees)

318,462 federal workers and retirees owed more than $3.3 billion in back income taxes as of September 30, 2013, a delinquency rate of 3.27% (compared to 8.7% for the entire U.S. population). See the full spreadsheet here.

Among the 18 executive departments, the embattled Department of Veterans Affairs has the second highest delinquency rate among its employees:  4.38% (behind the Department of Housing and Urban Development's 5.29%).

Among 27 large (> 1,000 employees) independent agencies, the Federal Reserve has the third highest delinquency rate:  6.51%.

The delinquency rate is 4.87% in the House of Representatives and 2.43% in the Senate.

In the tax world, the delinquency rate is 3.02 in the Tax Court and 1.20% in the Treasury Department (the IRS is not separately broken out).

For prior years data, see:

May 22, 2014 in Gov't Reports, IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 378

Wednesday, May 21, 2014

The IRS Scandal, Day 377

IRS Logo 2House Commitee on Oversight & Government Reform Press Release,  After DOJ Dodges Questions, Issa Subpoenas Justice Department for IRS Investigation Targeting Documents:

House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., today subpoenaed the Justice Department for documents after Richard Pilger, Director of the Department’s Election Crimes Branch, refused to answer critical questions on the instructions of Justice Department counsel during a transcribed interview on May 6, 2014. The subpoena follows an April 23, 2014 letter from 17 Members of the Committee requesting materials concerning the Department’s involvement in efforts to scrutinize tax-exempt applicants after emails surfaced between Pilger and the Internal Revenue Service’s Lois G. Lerner where they discussed singling out and prosecuting tax-exempt applicants, at the urging of a Democratic Senator.  As the Federal Election Commission, the IRS and the Justice Department looked for ways to minimize the impact of the Supreme Court’s decision in Citizens United, a clear outline emerges of government agencies cracking down on constitutionally protected free speech.

In a letter accompanying the subpoena, Chairman Issa stated: “The Department’s refusal to allow Mr. Pilger to testify about matters highly relevant to the Committee’s investigation unnecessarily delays and frustrates the Committee’s Constitutional oversight obligations.  The Department’s obstruction in this regard, coupled with its failure to produce any relevant material to date, leads the Committee to conclude the Department is not seriously committed to cooperating with the Committee’s investigation on the Committee’s terms.”

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May 21, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, May 20, 2014

The IRS Scandal, Day 376

IRS Logo 2 Taxable Talk:  Deadlines for Us, But Not for Them (Part 2), by Russ Fox (Clayton Financial and Tax, Las Vegas):

The IRS and Democrats wishing the IRS scandal to vanish won’t make it so. The revelations during the last week are going to harden Republicans’ stance on funding the IRS. The taxpaying public will suffer because of this, but I can’t lay the blame on the GOP here. Someone ordered the targeting of Tea Party groups, and until that person is made known and the IRS stops its delaying tactics on the scandal, the IRS’ budget will go down, not up.

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May 20, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Monday, May 19, 2014

The IRS Scandal, Day 375

Sunday, May 18, 2014

The IRS Scandal, Day 374

Saturday, May 17, 2014

The IRS Scandal, Day 373

Friday, May 16, 2014

IRS Seeks Grant Applications for Funding for Low Income Taxpayer Clinics

IRS Logo 2The IRS announced yesterday (IR-2014-63) that it is accepting grant applications for Low Income Taxpayer Clinics for the 2015 grant cycle (Jan. 1 - Dec. 31, 2015). Applications will be accepted through June 20, 2014. The LITC program awards matching grants of up to $100,000 per year to qualifying organizations to develop, expand, or maintain a low income taxpayer clinic. 

The IRS welcomes all applications and will ensure that each application receives full consideration. The IRS is particularly interested in receiving applications from organizations that will operate in areas that are currently underserved.

Currently underserved areas are as follows:

Identified Underserved Areas

States and Territories

Alabama, Alaska, Georgia, Kansas, Mississippi, North Dakota, South Dakota, Puerto Rico

Metropolitan Areas

Los Angeles, Calif., including the following counties:

Los Angeles, Kern, Riverside, Ventura

Sacramento, Calif., including the following counties:

El Dorado, Placer, Sacramento, San Joaquin, Stanislaus

Northern Virginia, including the following counties:

Arlington, Fairfax, Loudon, Prince William

May 16, 2014 in IRS News, Tax | Permalink | Comments (0)

TIGTA: 47% of Alimony Deductions Claimed Don't Match Alimony Income Reported to IRS

TIGTA The Treasury Inspector General for Tax Administration yesterday Significant Discrepancies Exist Between Alimony Deductions Claimed by Payers and Income Reported by Recipients (2014-40-022):

Individuals who pay alimony can deduct the amount paid from income on their tax return to reduce the amount of tax an individual must pay. Conversely, individuals who receive alimony must claim the amount received as income on their tax return. TIGTA initiated this audit to evaluate the alimony reporting gap and to assess controls the IRS has in place to promote reporting compliance.

Processes have not been developed to address the majority of discrepancies between alimony deductions claimed and income reported. TIGTA’s analysis of the 567,887 Tax Year 2010 returns with an alimony deduction claim identified 266,190 (47 percent) tax returns in which it appears that individuals claimed alimony deductions for which income was not reported on a corresponding recipient’s tax return or the amount of alimony income reported did not agree with the amount of the deduction taken. There is a discrepancy of more than $2.3 billion in deductions claimed without corresponding income reported.

May 16, 2014 in Gov't Reports, IRS News, Tax | Permalink | Comments (0)

The IRS Scandal, Day 372

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May 16, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Thursday, May 15, 2014

The IRS Scandal, Day 371

Judicial Watch, New Documents Show IRS HQ Control of Tea Party Targeting:

Judicial Watch today released a new batch of IRS documents revealing that its handling of Tea Party applications was directed out of the agency’s headquarters in Washington, DC.  The documents also show extensive pressure on the IRS by Senator Carl Levin (D-MI) to shut down conservative-leaning tax-exempt organizations. The IRS’ emails by Lois Lerner detail her misleading explanations to investigators about the targeting of Tea Party organizations. ...

“These new documents show that officials in the IRS headquarters were responsible for the illegal delays of Tea Party applications,” stated Judicial Watch President Tom Fitton. “It is disturbing to see Lois Lerner mislead the IRS’ internal investigators about her office’s Tea Party targeting. These documents also confirm the unprecedented pressure from congressional Democrats to go after President Obama’s political opponents. The IRS scandal has now ensnared Congress.”

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May 15, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (2)

Wednesday, May 14, 2014

The IRS Scandal, Day 370

IRS Logo 2Power Line:  The IRS Scandal for Dummies:

Nixon’s efforts to misuse the IRS were futile. They went nowhere. Nixon and his henchmen desired the IRS to “screw” their political opponents, but their efforts were a pathetic failure.

Nixon henchman Jack Caulfield astutely complained that the IRS was a “monstrous bureaucracy…dominated and controlled by Democrats.” As we have come to see, Caulfield was on to something. By contrast with Nixon’s failures to misuse the IRS, the IRS has very effectively “screwed” Obama’s political opponents, and we have yet to learn what the president knew and when he knew it.

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May 14, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Tuesday, May 13, 2014

TIGTA: IRS Again Fails to Comply With Statutory Mandated Reduction in Improper Payments -- 26% EITC Fraud Costs $16 Billion/Year

TIGTA The Treasury Inspector General for Tax Administration today released The Internal Revenue Service Fiscal Year 2013 Improper Payment Reporting Continues to Not Comply With the Improper Payments Elimination and Recovery Act (2014-40-027):

The Improper Payments Elimination and Recovery Act (IPERA) of 2010 strengthened agency reporting requirements and redefined “significant improper payments” in Federal programs. The Office of Management and Budget has declared the Earned Income Tax Credit (EITC) Program a high-risk program that is subject to reporting in the Department of the Treasury Agency Financial Report. The IRS estimates that 22 to 26 percent of EITC payments were issued improperly in Fiscal Year 2013. The dollar value of these improper payments was estimated to be between $13.3 billion and $15.6 billion.

The IRS continues to not provide all required IPERA information to the Department of the Treasury for inclusion in the Department of the Treasury Agency Financial Report Fiscal Year 2013. For the third consecutive year, the IRS did not publish annual reduction targets or report an improper payment rate of less than 10 percent for the EITC. IRS management has indicated that the IRS and the Department of the Treasury are in continued discussions with the Office of Management and Budget to obtain its approval to develop supplemental measures that are appropriate to gauge the impact of EITC compliance and outreach efforts in lieu of developing error reduction targets. Finally, although risk assessments were performed for each of the programs that the Department of the Treasury required the IRS to assess, the risk assessment process still may not provide a valid assessment of improper payments in tax administration. As such, the EITC remains the only revenue program fund to be considered at high risk for improper payments.

TIGTA

TIGTA 2

May 13, 2014 in Gov't Reports, IRS News, Tax | Permalink | Comments (2)

The IRS Scandal, Day 369

IRS Logo 2USA Today op-ed:  The Media Ignore IRS Scandal, by Paul L. Caron:

Today's news media are largely ignoring the IRS scandal, and it is impossible to have confidence in the current investigations by the FBI, Justice Department, and House committee. I am not suggesting that the current scandal in the end will rise to the level of Watergate. But the allegations are serious, and fair-minded Americans of both parties should agree that a thorough investigation needs to be undertaken to either debunk them or confirm them.

Step one should be to give Lois Lerner full immunity from prosecution in exchange for her testimony. And then let the chips fall where they may.

Rasmussen Reports:  57% Favor Further Investigation of the IRS:

Half of voters still believe the IRS broke the law when it targeted Tea Party and other conservative groups, and even more think the matter needs to be looked into further.

A new Rasmussen Reports national telephone survey finds that 57% of Likely U.S. Voters think the Obama administration’s handling of the IRS matter merits further investigation. Just half as many (28%) say the case should be closed. Fifteen percent (15%) are not sure. (To see survey question wording, click here.)

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May 13, 2014 in IRS News, IRS Scandal | Permalink | Comments (4)

Monday, May 12, 2014

The IRS Scandal, Day 368

IRS Logo 2New York Post editorial:  Our Newly Efficient IRS:

Many of the press accounts we read suggest there is no scandal here unless the targeting of Americans for their conservative political beliefs can be tied back to President Obama or the White House.

We beg to differ. Wouldn’t it be even more frightening if a federal agency as powerful as the IRS on its own decided to use its vast powers to squelch others on the basis of politics and ideology?

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May 12, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Sunday, May 11, 2014

The IRS Scandal, Day 367

Saturday, May 10, 2014

The IRS Scandal, Day 366

Friday, May 9, 2014

The IRS Scandal, Day 365

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May 9, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (3)

Thursday, May 8, 2014

The IRS Scandal, Day 364

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May 8, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Wednesday, May 7, 2014

The IRS Scandal, Day 363

IRS Logo 2Washington Post:  There Are Plenty of Smidgens in the IRS Scandal, by Ed Rogers:

Today, the House Rules Committee is considering a resolution recommending that former IRS official Lois Lerner be held in contempt for refusing to answer questions about her role in the IRS targeting of President Obama’s political opponents. It is likely that the resolution will pass, and then it will come to the floor for a full vote in the House. When it does, the vote to hold Lerner in contempt should be bipartisan – if not unanimous. Any Democrats who vote “no” should be labeled as enablers of obstruction of justice. It should be impossible for Democrats to defend a vote that could only serve to encourage more corruption and non-cooperation in the future. Of course Lerner had the right to plead the fifth, but that doesn’t mean Democrats should not pay a price for voting to bless her stonewalling.

In an interview with Fox News’ Bill O’Reilly in February, President Obama pre-empted his own Department of Justice investigation and declared that there was not a “smidgen of corruption” in the IRS scandal. Well, I think a senior official at the center of the allegations pleading the fifth constitutes a smidgen. It is not unfair to draw logical inferences from her continued refusal to cooperate with the investigation into the IRS targeting of conservative groups. To the best of my knowledge, no one in this White House has ever called on Lerner to cooperate. Why? Because they know it is not in their interest for her to cooperate. They hope she will continue her silence in comfortable retirement and that Republicans and the media will be intimidated into giving up. Or, at the very least, they hope they can run out the clock on the remainder of Obama’s term.

Meanwhile, at the Justice Department, the White House has built a firewall by appointing Obama donor Barbara Bosserman to head the investigation into the IRS affair. No smidgens here folks. Move along, nothing to see. Please. Someone in this Administration is guilty of manipulating the IRS – or, is guilty of knowing that the IRS was engaging in activities that targeted the president’s political opponents. There are smidgens lying all over the place.

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May 7, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (0)

Tuesday, May 6, 2014

IRS Seeks Grant Applications for Funding for TCE and VITA Programs

IRS Logo 2The IRS announced yesterday (IR-2014-60) that it is accepting grant applications for the Tax Counseling for the Elderly (TCE) and Volunteer Income Tax Assistance (VITA) grant programs through June 2, 2014:

The TCE program was established in 1978 to provide tax counseling and return preparation to persons who are 60 or older. Volunteers who provide free federal income tax help to seniors nationwide receive free training and technical assistance.

The VITA program, created in 1969, provides free federal income tax filing assistance to underserved communities. The VITA Grant program was established in 2007 to supplement the VITA program. The grant program enables VITA to extend services to underserved populations in hard-to-reach urban and non-urban areas. It increases the taxpayer’s ability to electronically file returns, and enhances volunteer training to improve the accuracy rate of returns prepared at VITA sites.

May 6, 2014 in IRS News, Tax | Permalink | Comments (0)

Low Income Taxpayer Grant Recipients

LITC LogoThe IRS announced yesterday (IR-2014-61) that it has awarded nearly $10 million in matching grants to Low Income Taxpayer Clinics (LITCs) for the 2014 grant cycle (Jan. 1, 2014 through Dec. 31, 2014). Through the LITC program, the IRS awards matching grants of up to $100,000 a year to qualifying organizations. For the 2014 grant cycle, the IRS awarded LITC grants to 133 organizations. For the full list of grant recipients, see here. For a list of the 37 law school tax clinic grant recipents, and the amount of their grants, see below the fold:

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May 6, 2014 in IRS News | Permalink | Comments (1)

The IRS Scandal, Day 362

Monday, May 5, 2014

The IRS Scandal, Day 361

Sunday, May 4, 2014

The IRS Scandal, Day 360

Saturday, May 3, 2014

The IRS Scandal, Day 359

Friday, May 2, 2014

The IRS Scandal, Day 358

IRS Logo 2Power Line:  Bill Henck: Inside the IRS, Part 2:

William Henck has worked inside the IRS Office of the Chief Counsel as an attorney for over 26 years. We posted his personal account, including his testimony to a retaliatory audit conducted by the IRS against him, this past February in “Inside the IRS.” This post follows up on the matters discussed in that post. 

IRS executives are confident in their lack of accountability because the decision makers in Washington will not hold them accountable. Ordinary people understand that misconduct and corruption in the national tax collection agency is a critical problem. They also understand the difference between right and wrong. Ordinary people, however, are not running things.

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May 2, 2014 in IRS News, IRS Scandal, Tax | Permalink | Comments (1)

Thursday, May 1, 2014

The IRS Scandal, Day 357

Wednesday, April 30, 2014

The IRS Scandal, Day 356