Oct. 2, 2014 SIGN IN | REGISTER

For Troubled IRS Division, Scandal Was Years in the Making

A few weeks later, Lois Lerner, the director of the EO Division, participated in a briefing in which the search criteria was discussed and she instructed that the language be changed to include all groups involved in political activities.

Still, it wasn’t until May 2012, shortly after officials from Washington visited Cincinnati to conduct training, that the two offices came to a final agreement about what the search criteria should be.

In its response to the IG report, the IRS defended its decision to place a team of specialists on political cases but agreed that it was wrong to take shortcuts that singled out conservative groups. It also agreed that “decisions with respect to the centralized collection of cases must be made at a much higher level of the organization.”

In the aftermath of the IG report, congressional leaders have vowed further investigations into the IRS.

“The American people deserve to know what actions will be taken to ensure those who made these policy decisions at the IRS are being held fully accountable and more importantly what is being done to ensure that this kind of raw partisanship is fully eliminated from these critically important non-partisan government functions,” all 45 Republican senators wrote to President Barack Obama on Wednesday.

Still, those familiar with the IRS are concerned that deeper problems with the agency and tax law may go unfixed. They note that current restrictions on the political activity of nonprofit groups are vague.

That grew more significant, former officials said, as the number of politically active nonprofits exploded in recent years and the IRS did not address the issue either through regulations or clear instructions to employees who handle applications.

“To me it’s personally embarrassing that EO didn’t seem to get ahead of the curve and realize that this was going to happen,” Friedlander said.

There are also questions about the lack of coordination between the Washington and Cincinnati offices and how a relatively small group of people can handle so many applications.

“If you only have 300, 350 people in Cincinnati and 60,000 applications to deal with, they’re basically always overwhelmed,” said Paul Streckfus, a former IRS employee who now edits the EO Tax Journal.

Bill Brockner, who retired from the EO Division in 2006, said managers and frontline workers at the division face an exceedingly difficult task.

“It’s not given the resources to do what they should do,” he said. “And the laws aren’t good enough, so you don’t know what’s going on, and the only time people get interested is when someone does something bad or something perceived to be bad like what’s going on now. And then there’s 15 minutes of uproar and then it’s forgotten.”

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