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4:19 pm
Wed May 15, 2013

10 Things We Learned From the IRS Inspector General Report

Originally published on Wed May 15, 2013 5:29 pm

Scintillating isn't how you'd describe the report issued by the Treasury inspector general's report on the Internal Revenue Service's targeting of conservative groups.

It was written, after all, by government bureaucrats for government bureaucrats. Enough said.

Still, peel back the careful, cautious and colorless language and there are some eyebrow-raising tidbits in the report that give a sense of the dysfunction in the tax-exempt unit that allowed the controversial targeting to occur.

Here are 10 of them:

  • The IG report was our first source without skin in the game (like IRS and White House officials) to report that agency employees said no outsiders influenced them to target conservative applicants. (Page 7)
  • The IRS employees responsible for applying greater scrutiny to groups with "Tea Party" or "Patriots" in their names were evidently incorrigible. After their boss told them to cease and desist they did, temporarily. Then they went back to doing their own thing, which meant using inappropriate filters to select applicants for additional review. (Page 7)
  • At one point, in an agency of 106,000 workers, just one, presumably very overwhelmed, bureaucrat had the job of reviewing applications for tax-exempt status that were selected for greater scrutiny because the information raised questions about their political activities. (Page 5, Footnote 14)
  • The inspector general says "it's considering" following up its first evaluation with a deeper dive into exactly how the IRS unit it studied monitors the political activities of the "social welfare" groups it grants tax-exempt status. It wants to make sure the unit knows when such organizations cross the line to engage in too much politics. (Page 4, Footnote 12)
  • Even employees in the IRS's tax-exempt unit were stupefied by the rules about which they had to make decisions. They were so confused, their bosses decided they needed hands-on training — after which an absurdly low and slow 2 percent application approval rate soared. Given the political sensitivity of this part of the IRS's work, you might have expected the training to happen sooner. The problems remain, however, according to the IG, and the guidance the workers labor under is vague at best. (Page 14)
  • Some applications for tax-exempt status were, astonishingly, under review for as long as three years. What's even more remarkable is that even though the law gives applicants the right to sue the IRS if they failed to get a conclusive response from the agency within 270 days, none did, at least not during the two years of the IG's investigation. Maybe Americans aren't as litigious as they're often given credit for being. (Page 16)
  • Even after the IG pointed out the error of their ways, IRS officials were, to some extent, still not seeing things as clearly as the IG thought they should. For instance, IRS officials said issues the IG raised had been resolved. The IG flatly contradicted them, saying no, they hadn't been fixed. (Opening memo)
  • Some applications from groups with evidence of substantial political activity weren't forwarded to the team that had the task of giving applications extra scrutiny. Others that lacked evidence of significant political activity weren't sent to the IRS review team for further investigation. (Pages 9-10)
  • IRS workers must watch a lot of TV cop dramas: They described their list of names to watch for as the "be on the lookout for" or BOLO list. (Page 6)
  • When the agency asked for additional information — information the IG ultimately deemed to be irrelevant to the applications in question — the IRS would ask applicants to meet their requests within three weeks even though the IRS had essentially sat on some of the applications for more than a year. That's what New Yorkers would call chutzpah. (Page 18)
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