IRS Scrutinized Progressive Groups as Well as Tea Party

Newly released Internal Revenue Service documents show that “be on the lookout” lists the agency used to process applications for tax-exempt status included progressive groups as well as tea party organizations, a fact not communicated in the inspector general’s report that triggered the IRS scandal, a key House Democrat has said.

Rep. Sander Levin, D-Mich., ranking member of the Ways and Means Committee, has released redacted documents that he said showed IRS employees used political rhetoric in evaluating applications of progressive groups seeking tax-exempt status, in addition to conservatives.

Levin’s move came in response to the IRS’ 30-day internal review -- released Monday -- of the agency’s mishandling of the applications.

Levin also sent a letter to J. Russell George, the Treasury Inspector General for Tax Administration, saying that George “seriously erred” in failing to communicate this fact in his May audit and in subsequent congressional testimony. “The audit served as the basis and impetus for a wide range of congressional investigations and this new information shows that the foundation of those investigations is flawed in a fundamental way,” Levin said in a statement.

TIGTA’s report focused on applicants for tax-exempt status that the IRS flagged for potential political campaign intervention, a spokesman who declined to be named said in an email to Government Executive.

“We have identified other criteria that use names and policy positions to refer cases,” he said. “Although these criteria were not used to select cases for review of potential political campaign intervention, we are reviewing whether these criteria led to expanded scrutiny for other reasons, and why these criteria were implemented.”

TIGTA was preparing its response to Levin, the spokesman said.

Levin also asked Ways and Means Chairman Dave Camp, R-Mich., to hold a hearing where the IG can explain the omission. Camp had already scheduled a hearing for Thursday to discuss the 30-day review released by acting IRS Commissioner Danny Werfel. In addition, Levin requested that the interviews with IRS employees “conducted to date be reevaluated and possibly supplemented in light of the information learned today.”

Though the May audit described the key words used for screening groups as “tea party,” “patriot,” and “9/12,” the new document includes a November 2010 BOLO list with a description of “progressives,” describing their “political activities” as follows:

“ Common thread is the word “progressive.” Activities appear to lean toward a new political party. Activities are partisan and appear anti-Republican. You see references to “blue” as being “progressive.” Applicants submit 1023. Their “progressive” activities appear to show that (c)(3) may not be appropriate.” .

Continuing the ongoing tit-for-tat between congressional staffs investigating the IRS matter, a Ways and Means spokeswoman issued a statement reminding reporters of an exchange during a June 4 hearing in which Democrats were given the chance to name progressive groups or call witnesses who were similarly targeted by the IRS, but they did not do so.

“It is one thing to flag a group, it is quite another to repeatedly target and abuse conservative groups,” the spokeswoman said. “Tea party groups were not just on a BOLO, they were (1) sent intrusive and inappropriate questions, (2) had their donors threatened with gift taxes and (3) had their confidential information leaked. The committee has welcomed all groups, regardless of affiliation, that feel they may have been targeted for extra scrutiny to come forward.”