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Do new IRS revelations prove there is no Tea Party scandal?
The new head of the tax agency says the IRS targeted lefty groups seeking tax-exempt status, too
 
New information suggests the IRS's intentions with the Tea Party weren't so sinister.
New information suggests the IRS's intentions with the Tea Party weren't so sinister. Getty Images

The Internal Revenue Service probably won't ever be popular, but its reputation has taken a big hit since revelations in May that several dozen conservative-sounding applicants for tax-exempt status were singled out for special scrutiny. Officials at the IRS's Cincinnati office used "Be On the Look Out" (BOLO) lists with an evolving (and devolving) list of terms, including "Tea Party," "patriot," or "9/12."

The subsequent shake-up at the IRS brought in a new commissioner, Danny Werfel, who said on Monday that the use of BOLO lists continued until at least April, that he'd formally put a stop to the spreadsheets last week — and that the breadth of the search terms was much wider than reported in a damaging inspector general's report.

Along with conservative and small-government tax-exempt applicants, IRS officials in Cincinnati also flagged groups whose applications contained words like "progressive," "occupy," "medical marijuana," and Israel. The final BOLO list from April contained the search term "Green Energy Organizations."

"House Democrats can hardly contain their delight" at the new revelations, says David Weigel at Slate. The extra scrutiny for "lefty/libertarian causes" seemingly "contradicts the theory that conservatives and only conservatives came under the laser."

Amid the delight, Democrats are a little miffed. Most of the IRS drama has taken place on Rep. Darrell Issa's (R-Calif.) House government oversight committee, but it was Democrats on the Ways and Means Committee who released the new lefty-targeting BOLO lists. Rep. Sander Levin (Mich.), the top Democrat on the committee, pointedly asked Treasury Inspector General J. Russell George why he didn't include the "progressive" groups in his bombshell report or subsequent testimony before Congress.

The American public expects competent, impartial, unbiased, and non-political treatment from the IRS. That same standard is also applicable to you and your organization. Your 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]

Salon's Alex Seitz-Wald says the documents prove that there was never anything partisan about the scrutiny:

The "whole scandal is entirely bogus," Seitz-Wald elaborates at Salon. "False. A fiction." The fact that the IRS targeted all sorts of political-sounding groups proves "it wasn't really singling out anyone."

And remember the only group actually denied tax-exempt status was a progressive one. This should put this matter to bed forever. All along, everyone agreed that the problem with the IRS' behavior was that the agency seemed to be giving extra scrutiny to groups of one political affiliation, and not the other. Now we know that it targeted groups on both sides. [Salon]

That's what liberals want you to think, says Eliana Johnson at National Review. But according to documents reviewed by National Review, Johnson says, "it is inaccurate to say that the applications of progressive and liberal groups were subjected to the same scrutiny as those of Tea Party groups, or even that a surprisingly broad array of criteria was applied to screen applications for tax exemption."

A November 2010 version of the list... suggests that while the list did contain the word "progressive," screeners were in fact instructed to treat "progressive" groups differently from "tea party" groups. Whereas screeners were merely alerted that a designation of 501(c)(3) status "may not be appropriate" for applications containing the word "progressive" — 501(c)(3) groups are prohibited from conducting any political activities — they were told to send those of tea-party groups off "to Group 7822" for further scrutiny.

That means the applications of progressive groups could be approved on the spot by line agents, while those of tea-party groups could not. Furthermore, the November 2010 list noted that tea-party cases were "currently being coordinated with EOT," which stands for Exempt Organizations Technical, a group of tax lawyers in Washington, D.C. Those of progressive groups were not. [National Review]

At the very least, the IRS's new revelations "bolstered its contention that delays experienced by Tea Party groups applying for nonprofit status were a symptom of mismanagement and not politically motivated action," say Richard Rubin and Julie Bykowicz at Bloomberg News. And more generally, it complicates "what had been seen as targeted scrutiny for small-government groups."

"The BOLO list in my mind loses this sinister nature," Jeff Trinca, a chief of staff to the IRS restructuring commission in the 1990s, tells Bloomberg. It looks like mostly "another way of creating criteria lists to try to deal with the huge volumes that come through the agency." But that doesn't mean the IRS handled the situation well. The agency didn't provide its Cincinnati staff with enough guidance, and they sort of went "crazy with these questions," Trinca adds. "The whole thing was just an absolute debacle."

 
Peter Weber is a senior editor at TheWeek.com, and has handled the editorial night shift since 2008. A graduate of Northwestern University, Peter has worked at Facts on File and The New York Times Magazine. He speaks Spanish and Italian, and plays in an Austin rock band.

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