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http://www.dailykos.com/story/2013/06/26/1219172/-Here-s-how-Darrell-Issa-manufactured-the-IRS-scandal
"On Monday, we learned that the IRS didn't single out tea party groups after all. Instead, they were looking for political groups, including not just tea party groups, but progressive groups as well. They may have used a flawed method for flagging the groups, but the IRS's intent was clear: to identify political groups that were not legally entitled to receive the tax-exempt benefit they sought to receive.
That pretty much brought the IRS "scandal" to a screeching halt. In the hours following the revelation, Darrell Issa's Twitter feed suddenly started spamming tweets about Benghazi. "Change the subject, quickly!" he seemed to be saying.
But there's still a question to be answered. If the IRS was targeting political groups from across the ideological spectrum, where did the original narrative about tea party targeting come from? The answer makes Darrell Issa and his fellow House Republicans look even worse than they did on Monday:
The Treasury inspector general (IG) whose report helped drive the IRS targeting controversy says it limited its examination to conservative groups because of a request from House Republicans.
A spokesman for Russell George, Treasury’s inspector general for tax administration, said they were asked by House Oversight Chairman Darrell Issa (R-Calif.) “to narrowly focus on Tea Party organizations.”
Obviously, if Issa wanted a comprehensive investigation, he should have asked for a review of all politically oriented scrutiny. Instead, he asked for exclusive focus on tea party and conservative groups. Under the most charitable interpretation of this, it never occurred to Darrell Issa that anyone other than the tea party groups could have been targeted. If that's true, it suggests he just doesn't care about whether the IRS "targets" anyone other than his political allies.
But I think the most likely explanation here is that Issa was simply trying to cook up a scandal, even though it did nothing to address the genuine problems with the way campaign finance and tax laws are written. He probably figured that in the best case scenario, he'd be able to get away with his fraud. And in the worst case scenario, he'd get a slap on the wrist from a few reporters, but endless approval from his political supporters. It's exactly the kind of thing you'd expect from Mr. Grand Theft Auto."
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Ironically, it was Mrs. Lerner herself, speaking at an ABA seminar on tax law, and answering a question from someone (?), who kicked off this 'scandal'.
Transcript of Lois Lerner’s Remarks at Tax Meeting Sparking IRS Controversy
Posted on May 11, 2013 7:37 am by Rick Hasen
With great appreciation and thanks to Paul Streckfus and his EO Tax Journal (subscription required), here are the relevant remarks which started yesterday’s controversy:
Lois Lerner’s Response to Tea Party Question
In response to a question about the IRS’s handling of Tea Party exemption applications, asked at the May 10 meeting of the Exempt Organizations Committee of the Tax Section of the American Bar Association, Lois Lerner, Director of the IRS’s Exempt Organizations office, made the following response:
“We get about 60,000 applications for tax exemption every year, most of them are 501(c)(3) organizations. But between 2010 and 2012 we started seeing a very big uptick in the number of 501(c)(4) applications we were receiving and many of these organizations applying more than doubled, about 1500 in 2010 and over 3400 in 2012. So we saw a big increase in these kind of applications, many of which indicated that they were going to be involved in advocacy work.
So our line people in Cincinnati who handled the applications did what we call centralization of these cases. They centralized work on these in one particular group. They do that for efficiency and consistency — something we do whenever we see an uptick in a new kind of application or something we haven’t seen before. Folks might remember from back a few years ago we had credit counseling organizations and we centralized those cases. We had mortgage foreclosure cases and we centralized those cases. We do it for consistency So they went ahead and did that. How they do centralization is they have a list in their office that they give out to folks who are screening cases that says if it is one of these kind of cases and it can’t be screened it needs to go to group X. So centralization was perfectly fine.
However, in these cases, the way they did the centralization was not so fine. Instead of referring to the cases as advocacy cases, they actually used case names on this list. They used names like Tea Party or Patriots and they selected cases simply because the applications had those names in the title. That was wrong, that was absolutely incorrect, insensitive, and inappropriate — that’s not how we go about selecting cases for further review. We don’t select for review because they have a particular name.
The other thing that happened was they also, in some cases, cases sat around for a while. They also sent some letters out that were far too broad, asking questions of these organizations that weren’t really necessary for the type of application. In some cases you probably read that they asked for contributor names. That’s not appropriate, not usual, there are some very limited times when we might need that but in most of these cases where they were asked they didn’t do it correctly and they didn’t do it with a higher level of review. As I said, some of them sat around for too long.
What have we done to take care of this? Oh, let me back up. They didn’t do this because of any political bias. They did it because they were working together. This was a streamlined way for them to refer to the cases. They didn’t have the appropriate level of sensitivity about how this might appear to others and it was just wrong. So when we found out about it we did a couple of things. First, we said that list that goes around for centralizing cases any changes on that list have to be reviewed and approved at the Director of Rulings & Agreements level so line staff can no longer change or add to that list without calling us to look at it.
We also went back and looked at questions that had been sent out to folks because some of them were extensive and where the questions weren’t necessary we gave the organizations flexibility as to which questions they needed to answer and gave them more time to answer them. In some cases we told them to just ignore the letter we already sent and sent a new list of questions. In some cases we said we don’t need those questions answered. We can deal with your application without responses to those questions. We also sorted the cases to try and figure out which cases needed a further look and which cases could be handled through almost a screening process. We might need a litle bit more information.
The problem in the (c)(4) area is that the kind of activity the organizations were doing is okay for (c)(4)s but it can’t be their primary activity. So that weighing and balancing is a little different than when we have a (c)(3) that says you can’t do any political activity. That’s a pretty easy question. So I guess my bottom line here is that we at the IRS should apologize for that, it was not intentional, and as soon as we found out what was going on, we took steps to make it better and I don’t expect that to reoccur.
As long as we are on the topic of potential political activity, it’s a good time to remind all of you as you are looking at filing for 2012 there was a lot of political activity in organizations this past year and so we’ll be looking at the 527(f) tax, as we see the 2012 990s coming in, so make sure that your clients are appropriately computing the 527(f) tax.
http://electionlawblog.org/?p=50160
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Again, the real scandal is the desire of the GOP and its fanatical teajadist wing to hide their donors' identities and to keep the IRS from rejecting their 501(c)4 status...and, of course, to cast aspersions on the President and sway the 2014 midterms.
