Paul L. Caron
Dean


Saturday, April 25, 2015

The IRS Scandal, Day 716

IRS Logo 2Forbes, IRS Forced To Release Names Of Targeted Groups, by Peter J. Reilly:

So we had another Tea Party decision on April 1 of all days. NorCal Tea Party Patriots is one of the ten organizations in a lawsuit against the IRS because of delays and intrusive scrutiny while they were applying for exempt status.  They want it to be a class action suit, but they need information from the IRS to determine what organizations should be in the class. ...

The IRS argued that it could not make those disclosures, because they would be in violation of Code Section 6103 which protects the confidentiality of returns and return information.  The judge went with NorCal on this one.

The Court concludes that the return information sought is directly related to the issue of class certification in this federal court proceeding. The names of the putative class member organizations and their control dates—the date which the putative class member organizations submitted their applications for tax exempt status to the IRS—are directly related to the issue of class certification. Plaintiffs seek the return information of the putative class members to prove to the Court that the Federal Rule of Civil Procedure 23(a) and 23(b) requirements such as typicality, commonality, and whether the IRS acted on a grounds that applied generally to the putative class are satisfied. ...

I’m beginning to despair of their ever being an end to the IRS Scandal on Day 714 by the TaxProf count, as I write this. I thought this latest decision might be a good opportunity to reach out to someone who might have a different view on the whole matter.

Frank Wolpe, Professor Emeritus at Bentley University has written a white paper about rebuilding the IRS. (download)

The paper identifies the ill-conceived massive 1998 structural reorganization and division (like salami-slicing) of field operations as a major cause of the IRS’s current legal battles and “downward slide.” In its 1998 aftermath, we were all left with an overly centralized Washington IRS National Office and an undermanaged array of field operations. That’s where the Tea Party scandal started; and, even more importantly, it need never be repeated. Indeed, such events must stop!

“With that recognition, change-makers can travel a 2015 bipartisan pathway to addressing a wrong-headed 1998 “solution” to a 1998 non-existent structural problem by introducing a 2015 proposal for a National Office consolidation (slimming down) coupled with a field operations decentralization (closer to customers and ending the practice of absentee senior management without local accountability).

Of course the notion that the scandal must have actually started in the Oval Office still has an irresistible grip in some circles, so a boring reorganization just won’t be satisfying.  So maybe it never will end.

Hans von Spakovsky of cnsnews.com wrote:

The arguments in this case by the Justice Department are another example of how the IRS has been hiding behind Section 6103. That law was intended to prevent the IRS from publicly disclosing private tax information—such as its illegal disclosure of the tax returns of the National Organization for Marriage (the IRS agreed to pay National Organization for Marriage $50,000 to settle that case in June of 2014). But the IRS has been trying to use this law to prevent having to disclose its abusive treatment of taxpayers.

https://taxprof.typepad.com/taxprof_blog/2015/04/the-irs-7.html

IRS News, IRS Scandal, Tax | Permalink

Comments

Using victims as shields, pretty disgusting.

Posted by: wodun | Apr 25, 2015 11:15:25 AM

It was not the IRS as an agency that targeted conservative organizations, that has lied about illegal actions, and that continues to stonewall investigations… it’s individuals acting on behalf of the Democratic Party. They are Democratic operatives within the White House, Justice Department, and Treasury Department, on the government payroll, who illegally used the agency for contemptible political purposes.

The Democratic Party as an organization and its operatives as individuals should be charged and held liable for ultimate damages rather than taxpayers.

“Time to Break Out the RICO Statute and Break Up the Democrats” -- How to defeat "a criminal organization masquerading as a political party."

Posted by: Woody | Apr 25, 2015 5:19:51 PM

Woody, had those key players been conservatives targeting progressive organizations, staff would have leaked it to the press. Not one person blew the whistle on this operation. That's called complicity.

In large private sector companies employees are trained to report any unethical behavior to an Ethics office. If there is such an office at the IRS, they dropped the ball as well.

Posted by: AMT buff | Apr 25, 2015 8:29:56 PM

Just a reminder folks, the 1998 reorganization was demanded and supervised by Republicans and sold through a series of hearings on IRS abuses where the "incidents" used to incite Congress and the public turned out to be spurious. The country did not recover from the harm to the professionalism of the IRS and the decline in tax compliance for perhaps 10 years. How much money was wasted in pursuit of politicians’ agendas unrelated to the public good? Shame on the politicians who would hobble and dismantle an organization absolutely essential to the functioning of our democracy--few people can imagine the damage to our country if the IRS failed to function—while denying responsibility for the rules the organization is obligated to administer. And sorry, you still need a strong IRS to administer a flat tax, even if it were a good idea.

Posted by: taxlifer | Apr 28, 2015 7:36:04 AM

No, we do not need the IRS or the Income Tax. Income Tax is nothing but a useful political class warfare tool, just as Marx intended it.
Income Taxes (and Corporate Taxes) are, in reality, nothing but Sales Taxes in disguise. Think about it!

Posted by: John | Apr 30, 2015 6:10:19 AM