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Paul L. Caron
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Wednesday, July 30, 2014

The IRS Scandal, Day 447

IRS Logo 2The House Oversight & Government Reform Committee holds a hearing today on IRS Abuses: Ensuring that Targeting Never Happens Again:

  • David Keating (Center for Competitive Politics)
  • Cleta Mitchell (Foley & Lardner)
  • James Sherk (Heritage Foundation)
  • Hans A. von Spakovsky (Heritage Foundation) 

Wall Street Journal:  GOP Report Floats IRS Changes on Tax-Exempt Group Oversight:

As the IRS probe grinds on, congressional Republicans are floating ideas to ensure IRS targeting of conservative groups doesn’t happen again. While they don’t call for ripping up the floorboards at the agency’s Washington headquarters, they come pretty close, according to a new report reviewed by the Wall Street Journal.

The House Oversight and Government Reform Committee report, prepared in advance of a hearing scheduled for Wednesday, recommends getting the IRS out of the business of regulating political activities by tax-exempt groups in order to ensure its continued objectivity.

“Congress must disentangle politics from the IRS,” the report said. “To regain the trust of American taxpayers, the IRS must return to its traditional role as a dispassionate administrator of the federal tax code.” ...

Perhaps the most eye-catching of the ideas in the report: eliminating the IRS commissioner job. Republicans say the commissioner structure has provided insufficient oversight of the agency at a time when its workload has been expanding rapidly.

Instead, lawmakers said, Congress should turn the IRS over to a bipartisan commission, like the ones that runs some regulatory agencies.

Wall Street Journal editorial:  The IRS's Foreign Policy:

The IRS has stuck by its story that tax-exempt applications by conservatives got slow-rolled because of bureaucratic bungling not because the groups opposed President Obama's policies. Now the slow drip of email evidence to congressional investigators is casting further doubt on that tale.

In 2009 the Pennsylvania group Z Street applied for tax-exempt status for its mission of educating people about Israel-related issues. In 2010 an IRS agent told Z Street that its application was delayed because the tax agency's Washington, D.C. office was giving special scrutiny to groups whose missions might conflict with Administration policies. The IRS's "Be On the Lookout" list that November also included red flags for groups referring to "disputed territories."

Z Street sued in August 2010 for viewpoint discrimination and its case is headed for discovery in federal court. Now emails uncovered by the House Ways and Means Committee show that the IRS and State Department were conferring in 2009 about pro-Israel groups like Z Street and considering arguments to deny their tax-exempt applications. ...

On Monday the IRS filed an appeal of the judge's decision denying its motion to dismiss Z Street's case. The government says the action stops all discovery while the appeal is pending, a process that could take months or even years. By filing the appeal on the last possible day, the Justice Department is running out the clock on discovery during the remainder of the Administration.

This is a whole lot of effort to prevent discovery in a case that is not even seeking damages. Ways and Means uncovered the email exchange between State and the IRS only after Treasury was forced to turn over documents it had previously withheld. What else did it lose in the ether?

https://taxprof.typepad.com/taxprof_blog/2014/07/the-irs-7.html

IRS News, IRS Scandal, Tax | Permalink

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