The Internal Revenue Service used keywords to target groups on the left as well as the right, documents released Monday show. “Progressive” and “Occupy” were among the terms used to scrutinize applicants for tax-exempt status.
The news suggests that the IRS did not set out to go after conservative or Tea Party groups for political reasons, as many conservatives have charged, but rather was looking to crack down on groups of all stripes who were seeking tax-exempt status despite doing political work.
Also on the IRS’ Be On The Lookout (or “BOLO”) list: groups promoting Obamacare, and medical marijuana advocacy groups.
By law, groups that conduct significant political activities are not supposed to receive tax breaks. But over the years the amount of political work that an applicant can do and still be given tax-exempt status has grown. Indeed, several of the Tea Party groups complaining loudest about IRS targeting had close ties to the GOP. Giving tax-exempt status to groups that appear aimed at swaying elections, like Karl Rove’s Crossroads GPS and the powerful liberal group Priorities USA, has allowed them not just to save money but to keep their donors secret. Pushed by good-government groups, the IRS was trying to enforce the law more strictly.
Newly appointed IRS Commissioner Daniel Werfel said Monday that applicants now must attest that the share of their activities devoted to electoral campaigns cannot exceed 40%—still a far more lenient standard than the law appears to call for.
Democrats seized on the news that progressive groups were targeted to declare that the slew of Congressional probes launched by Republicans into the targeting are based on a faulty premise, and to question why the Treasury Department Inspector General, J. Russell George, gave a misleading picture by failing to mention the targeting of progressive groups in his report released last month.
“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,” said Rep. Sander Levin of Michigan, the top Democrat on the House Ways and Means committee.
The new report, a mandated 30-day review of the issue by Werfel, also found no evidence of anyone outside of the IRS directing the keyword search nor any evidence of intentional wrongdoing. It blamed management and judgement failures for the targeting.
House Oversight Committee Chair Darrell Issa, who led the GOP in its attack on the administration after the targeting was revealed last month, was unsatisfied with the new report. "As investigations by Congress and the Justice Department are still ongoing, Mr. Werfel's assertion that he has found no evidence that anyone at IRS intentionally did anything wrong can only be called premature," Issa said in a statement.