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IRS apologizes for targeting conservative groups during 2012 election

By Stephen Ohlemacher

Associated Press

Published: Friday, May 10 2013 2:00 p.m. MDT

Many conservative groups complained during the campaign that they were being harassed by the IRS. They accused the agency of frustrating their attempts to become tax exempt by sending them lengthy, intrusive questionnaires.

The forms, which the groups have made available, sought information about group members' political activities, including details of their postings on social networking websites and about family members.

IRS Commissioner Douglas Shulman told Congress in March 2012 that the IRS was not targeting groups based on politics.

"There's absolutely no targeting. This is the kind of back and forth that happens to people" who apply for tax-exempt status, Shulman told a House Ways and Means subcommittee.

The IRS said senior leaders were not aware that specific groups were being targeted at the time of the hearing.

Shulman was appointed by President George W. Bush. His 6-year term ended in November. President Barack Obama has yet to nominate a successor. The agency is now being run by acting Commissioner Steven Miller.

Rep. Charles Boustany, R-La., chairman of the Ways and Means oversight subcommittee, requested a trove of documents from the IRS on Friday, including all communications containing the words "tea party" and "patriot."

House Majority Leader Eric Cantor, R-Va., and the House Oversight and Government Reform Committee have also promised investigations.

There has been a surge of politically active groups claiming tax-exempt status in recent elections — conservative and liberal. Among the highest profile are Republican Karl Rove's group, Crossroads GPS, and the liberal Moveon.org.

These groups claim tax-exempt status under section 501 (c) (4) of the federal tax code, which is for social welfare groups. Unlike other charitable groups, these organizations are allowed to participate in political activities but their primary activity must be social welfare.

That determination is up to the IRS.

Lerner said the number of groups filing for this tax-exempt status more than doubled from 2010 to 2012, to more than 3,400. To handle the influx, the IRS centralized its review of these applications in an office in Cincinnati.

Lerner said this was done to develop expertise among staffers and consistency in their reviews. As part of the review, staffers look for signs that groups are participating in political activity. If so, IRS agents take a closer look to make sure that politics isn't the group's primary activity.

As part of this process, agents in Cincinnati came up with a list of things to look for in an application. As part of the list, they included the words, "tea party" and "patriot," Lerner said.

"It's the line people that did it without talking to managers," Lerner. "They're IRS workers, they're revenue agents."

In all, about 300 groups were singled out for additional review, Lerner said. Of those, about a quarter were singled out because they had "tea party" or "patriot" somewhere in their applications.

The IRS statement said that once applications were chosen for review, they all "received the same, even-handed treatment."

Lerner said 150 of the cases have been closed and no group had its tax-exempt status revoked, though some withdrew their applications.

"Mistakes were made initially, but they were in no way due to any political or partisan rationale," the IRS said in a statement. "We fixed the situation last year and have made significant progress in moving the centralized cases through our system."

"I don't think there's any question we were unfairly targeted," said Tom Zawistowski, who until recently was president of the Ohio Liberty Coalition, an alliance of tea party groups in the state.

Zawistowski's group was among many conservative organizations that battled the IRS over what they saw as discriminatory treatment. The group first applied for nonprofit status in June 2009, and it was finally granted on Dec. 7, 2012, he said — one month after Election Day.

"It is suspicious that the activity of these 'low-level workers' was unknown to IRS leadership at the time it occurred," said Jenny Beth Martin, national coordinator for Tea Party Patriots, which describes itself as the nation's largest tea party organization. "President Obama must also apologize for his administration ignoring repeated complaints by these broad grass-roots organizations of harassment by the IRS in 2012, and make concrete and transparent steps today to ensure this never happens again."

Associated Press writers Alan Fram in Washington and Steve Peoples in Boston contributed to this report. Follow Stephen Ohlemacher on Twitter: http://twitter.com/stephenatap

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