TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Wednesday, February 7, 2018

The IRS Scandal, Day 1735: The End Of IRS Targeting?

IRS Logo 2Wall Street Journal, The End of IRS Targeting?:

It can be hard to keep track of Obama-era targeting of the political opposition by federal administrative agencies. But this week brings fresh hope that such abuses will not be repeated.

The Journal reports:
President Donald Trump will nominate Charles Rettig, a California tax lawyer, to run the Internal Revenue Service, a person familiar with the matter said Monday.
If confirmed by the Senate, Mr. Rettig will take one of the most thankless jobs in Washington.

Of course in recent years it has been thankless for especially good reason. During the Obama administration, the tax agency targeted conservative organizations for exceptional scrutiny and even harassment. Last year the IRS settled lawsuits brought by organizations that had been mistreated simply because they advocated for limited Constitutional government. The government shelled out millions of dollars to settle one suit involving 428 organizations, according to an October report in the New York Times. In a separate case brought by different organizations, an apology for the IRS’s egregious conduct was enough to resolve the litigation.

Reported the Times:
The settlements were the conclusion of two legal battles that have dogged the I.R.S. since the initial lawsuits were filed after a 2013 treasury inspector general’s audit that found groups with “Tea Party” or “Patriot” in their names received more scrutiny over their applications for tax-exempt status. The revelations plunged the I.R.S. into a firestorm that ultimately led to the ouster of its acting commissioner and prompted accusations that the agency was being used as a political weapon by the Obama administration.

While Mr. Obama did force the resignation of the acting IRS commissioner in the wake of the scandal in 2013, he made no serious effort to reform the agency and proclaimed that the targeting had involved “not even a smidgen of corruption” long before his government had finished investigating.

Mr. Obama also placed John Koskinen atop the agency. Mr. Koskinen’s failures to comply with subpoenas and to report accurately to the Congress inspired an effort to impeach him in 2015. A Journal editorial at the time noted:
In February 2014 Congress instructed Mr. Koskinen to supply all emails related to Lois Lerner, who ran the IRS Exempt Organizations division during the targeting. We now know Mr. Koskinen made little or no effort to preserve or track these communications and that, only a few weeks after the subpoena, IRS employees in West Virginia erased 422 backup tapes, destroying up to 24,000 Lerner emails.

So the bar has been set very low. Can the new IRS chief clear it? ...

A man who has spent a career across the table from the IRS, sometimes clashing with the agency in court, would seem to possess some useful experience. Here’s hoping he chooses to be a reformer.

https://taxprof.typepad.com/taxprof_blog/2018/02/the-irs-scandal-day-1735-the-end-of-irs-targeting.html

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Comments

"Only a few weeks after the subpoena, IRS employees in West Virginia erased 422 backup tapes, destroying up to 24,000 Lerner emails."

This is an important point. When Lerner's hard drive originally crashed, the IRS did not follow standard data recovery procedures for email and junked it.

Then, the backup server housing her email was erased, despite very explicit instructions from the IRS's top techonology officer that only a child could misunderstand.

There were a lot of coincidences like this in the previous administration...

Posted by: MM | Feb 7, 2018 7:38:58 AM