IRS Mistakes Exposed: Results In A String Of Investigative Hearings

The Internal Revenue Service (IRS) has faced recent accusations of political discrimination which have opened up a series of investigative hearings about the agency's targeting of conservative groups seeking tax-exempt status that began Friday morning.  

Steven Miller, former acting commissioner of the IRS, appeared before the House Ways and Means Committee on Friday morning for the first congressional 'showdown,' the Los Angeles Times reports.  Miller apologized for the agencies "foolish mistakes" in its handling of conservative groups applying for tax-exempt status and attributed their actions to a misguided pursuit of efficiency rather than partisan targeting.

"I want to apologize on behalf of the Internal Revenue Service for the mistakes that we made and the poor service we provided," Miller told the committee, according to ABC News. "The affected organizations and the American public deserve better. Partisanship and even the perception of partisanship have no place at the Internal Revenue Service."

"I think that what happened here was that foolish mistakes were made by people who were trying to be more efficient in their workload selection," Miller said, according to CNN.  He referred to the practices described in the inspector general's report as "intolerable" and a "mistake," but "not an act of partisanship."

Miller was forced to announce his resignation as acting IRS commissioner earlier this week in connection with the controversy, CNN reports.  This matter has put President Barack Obama's administration on the defensive because certain GOP members, including House Ways and Means Committee Chairman Dave Camp, have suggested that this controversy is indicative of government gone wild.

Camp and many other Republicans claimed that Miller had misled Congress by failing to reveal the extent of the problem at previous hearings dating back a year, according to CNN.  "How can we conclude you did not mislead this committee?" asked GOP Rep. Paul Ryan of Wisconsin.  Miller responded saying that he had not misled the committee and that the controversy was not politically motivated.

This, "revelation goes against the very principles of free speech and liberty upon which this country was founded," Camp said in reference to the controversy, according to the LA Times.  Camp went after the Obama Administration saying that the controversy was a reason to overhaul the tax code.  "Under this administration, the IRS has abused its power to tax and it has destroyed what little faith and hope the American people had in getting a fair shake in Washington," he said.

"The reality is this is not a personnel problem. This is a problem of the IRS being too large, too powerful, too intrusive and too abusive of honest, hardworking taxpayers," Camp said, according to ABC.

In addition Camp, J. Russell George, the Treasury inspector general for tax administration, also testified, according to the LA Times.  George's recent finding were released a report earlier this week, days after an IRS official first acknowledged that conservative groups applying for nonprofit status had faced additional and intrusive reviews.  "Our report, issued earlier this week, addresses three allegations: First, that the IRS targeted specific groups applying for tax-exempt status; second, that they delayed the processing of these groups' applications; and third, that the IRS requested unnecessary information from the groups it subjected to special scrutiny," George said in his opening statement. "All three allegations were substantiated."

"These findings have raised troubling questions about whether the IRS has effective management oversight and control, at least in the Exempt Organizations function," George continued, according to the LA Times.

ABC reports that the IRS's "improper use of tougher scrutiny of conservative groups seeking tax-exempt status seems [to be] part of a broader pattern of intimidation and cover-ups by the Obama administration, a top House Republican said Friday."

An internal IRS watchdog reported this week that IRS investigators had singled out groups that  contained with conservative-sounding words or phrases such as "Patriot" and "Tea Party" in their titles when they applied for a tax-exempt status, Reuters reports.  A group with such status is allowed to keep their donor lists secret while engaging in limited political activity. Political campaigns, however, are required to make their donor lists public.

Tea Party groups claim to have been asked for information such as the books that they read, Reuters reports. This questioning, in some cases, took nearly three years, which prevented certain groups from participating in the 2010 and 2012 elections.

Reuters reports that the IRS watchdog blamed the scandal on ineffective management and bureaucratic confusion.  The agency has seen double the number of groups apply for so-called 501(c)4 status since a January 2010 Supreme Court decision loosened campaign-fiance rules.

CNN reports that, while Democrats on the committee also expressed outrage at the political targeting of conservative groups seeking tax exempt status, they also noted that the top IRS official at the time had been appointed by Republican President George W. Bush, rather than Obama.  In addition, they noted that the inspector general's report stated no significant evidence of any influence coming from outside of the IRS.

"Democrats sought to balance their rejection of any perception of political manipulation by the IRS with an effort to portray the situation as a poorly managed increase demand for tax exempt status by political groups," CNN reports.

Some Democrats were in agreement with some of the Republican accusations, the LA Times reports.  "What is now completely clear is that the management and oversight of the agency's handling of tax exemption application have completely failed the American people," said Michigan Rep. Sander M. Levin,  the top Democrat on the panel.  However, he added that, "if this hearing essentially becomes an effort to political points, it will be a disregard of the duties of this committee.  We must seek the truth, not political gain."

Levin asked Miller and George whether they had found any evidence of political motivation in connection with the IRS employees who reviewed the applications for tax-exempt status, the Washington Post reports. "We did not, sir," they both replied.

"Friday's hearing is the first of what are expected to be many on the subject by congressional panels," ABC reports.  Miller has been sworn in as a witness, due to the seriousness of the issue at hand.  This an unusual step for the Ways and Means panel and one that could put Miller in jeopardy if he is later shown to have misled lawmakers with his testimony, according to ABC.