While the Justice Department has opened a criminal probe of the Internal Revenue Service’s treatment of tea party groups, the White House for now appears to be in the clear of involvement. A report issued Tuesday evening by the Treasury Department’s Inspector General for Tax Administration found that no one outside of the IRS was involved in the targeting conservative groups with “tea party” or “patriot” in their name for special reviews of their applications for tax-exempt status.
The report blamed the incident on “insufficient oversight by IRS management,” and said that IRS’ actions were not influenced by outside interests. President Obama later called the IRS’s actions “intolerable and inexcusable” and tasked Treasury Secretary Jack Lew with holding the employees responsible accountable.
“Regardless of how this conduct was allowed to take place, the bottom line is, it was wrong,” Obama said. - Read more at The Washington Post
IRS GAVE LIBERAL GROUPS A PASS “In February 2010, the Champaign Tea Party in Illinois received approval of its tax-exempt status from the IRS in 90 days, no questions asked. That was the month before the Internal Revenue Service started singling out Tea Party groups for special treatment. There wouldn't be another Tea Party application approved for 27 months.” USA Today dug through the data to find that progressive organizations sailed through the tax-exemption process. While applications from Tea Party groups were "in limbo" for more than two years, organizations with liberal names such as Missourians Organizing for Reform and Empowerment received approval in as little as nine months. - Read More at USA Today
Here’s an IRS questionnaire given to Tea Party Groups
WHAT’S IN THE REPORT? Here’s how The Fiscal Times’ Josh Boak breaks down the IG’s report:
Internal Revenue Service employees based in Cincinnati developed criteria in March, 2010 to “Be On the Look Out” for any organization featuring “Tea Party,” “Patriots,” “9/12,” or other “political-sounding” terms in the name. The inquiries included groups not linked to the Tea Party movement, but IRS officials in Washington allowed a standard that specifically examined conservative groups to stay in place for more than 18 months. Ninety-eight organizations received requests for additional information from the IRS that the inspector general deemed unnecessary in its report. The requests included donor names, a list of officers and directors’ political affiliations, and information on the outside employment of the organization’s leadership.
The report doesn’t state that organizations seeking non-profit status should escape IRS scrutiny. It objects to “inappropriate” politicized criteria. The inspector general also concludes that the IRS has not resolved its problems. - Read more at The Fiscal Times
IRS UNDER FIRE FROM ALL ANGLES Four separate congressional committees are investigating actions taken by the IRS. The House Ways and Means Committee will hold the first hearing on Friday. While legal experts are skeptical that criminal charges will come out of the Justice Department’s probe of the IRS, there are sure to be numerous administrative actions and firings. David H. Laufman, a former Justice Department lawyer, told The Washington Post that “although there may be a range of administrative actions that could be taken against IRS employees for their conduct, it may be difficult to prosecute them criminally unless they intentionally violated the law.” -Read more at The Hill
HOLDER IS GRILLED ON AP PROBE Attorney General Eric Holder faces intense questioning this afternoon by the House Judiciary Committee, following reports that the Justice Department had secretly seized a large cache of telephone records of Associated Press reporters. The records were obstained as part of a year-long investigation into the disclosure of classified information about a failed al-Qaeda plot in Yemen to bomb an aircraft headed for the U.S. Holder, who has been in the hot seat before, recused himself from that investigation last year. He told reporters on Tuesday that he stepped aside because “I was one of the people who had knowledge of this matter. I have frequent contact with the media…I would have been the person leading the investigation,” Holder added. The Justice Department said the decision to subpoena AP reporters’ phone records was made by Deputy Attorney General James Cole. - Read more at Politico
GOP GOES AFTER IRSROLE IN OBAMACARE Sen. Dean Heller ,R-Nev., is preparing legislation that would prevent the IRS from hiring new agents to implement the Affordable Care Act. Heller and other Republicans are questioning whether the agency can be trusted to be politically neutral as it assumes a key role in implementing President Obama’s signature health care reform law. In a letter to Health and Human Services Secretary Kathleen Sebelius, Heller wrote, "It is necessary that both Congress and the Department of Health and Human Services [HHS] look closely at the money given to the IRS through the healthcare law . . . . I believe we need to address [the issue] now, which may mean calling for a temporary suspension until it is clearer where this funding will go.” Meanwhile, House Republicans are expected to vote for the repeal of Obamacare -- a strictly symbolic action -- for the 37th time on Thursday. - Read more at The Hill
IN CASE YOU MISSED IT…OBAMA HALVES THE DEFICIT The Congressional Budget Office released a report Tuesday estimating that the deficit for this fiscal year, which ends on Sept. 30, will fall to $642 billion. That’s roughly 4 percent of the nation’s annual economic output and about $200 billion lower than CBO’s earlier estimates. “But don’t expect the feud with House Republicans over the deficit to stop. The autumn showdown over the debt ceiling will continue as scheduled,” The Fiscal Times’ Josh Boak writes. “The long-term trends still remain. Federal spending hits an inflection point in 2016, as baby boomer retirements start to mount and the deficit returns to an upward trajectory. The national debt by 2023 continues to be a historically high 73.6 percent of Gross Domestic Product.” - Read more at The Fiscal Times
THE HIDDEN COST OF WAR: MEDICAL BILLS “For every one of the 866,181 soldiers officially counted as injured in Iraq and Afghanistan, the government is expected to spend some $2 million in long-term medical cost,” The Fiscal Times’ David Francis writes. That’s a total of $1.7 trillion, and includes $800 billion already spent on injured veterans as well as the cost of long-term care for an additional 50,000 casualties, according to a paper by Harvard professor Linda Bilmes. The VA has spent $134.3 billion to care for veterans since 2001, and according to VA spokesperson Genevieve Billia, the VA will spend $6.9 billion in 2013, $7.6 billion in 2014 and $8.0 billion in 2015 in medical costs. - Read more at The Fiscal Times