Between 2010 and 2012, the IRS saw the number of applications for section 501(c)(4) status double. As a result, local career employees in Cincinnati sought to centralize work and assign cases to designated employees in an effort to promote consistency and quality. This approach has worked in other areas. However, the IRS recognizes we should have done a better job of handling the influx of advocacy applications. While centralizing cases for consistency made sense, the way we initially centralized them did not. Mistakes were made initially, but they were in no way due to any political or partisan rationale. We fixed the situation last year and have made significant progress in moving the centralized cases through our system. To date, more than half of the cases have been approved or withdrawn. It is important to recognize that all centralized applications received the same, even-handed treatment, and the majority of cases centralized were not based on a specific name. In addition, new procedures also were implemented last year to ensure that these mistakes won’t be made in the future. The IRS also stresses that our employees – all career civil servants — will continue to be guided by tax law and not partisan issues.
According to tweets from the IRS conference call, one of the IRS officials said he or she was “not good at math.” Links to press coverage to come.
This is not one of the best days for the IRS. Conservatives are absolutely right to call for a congressional investigation of this one, even if it turns out to be an isolated problem.
For liberals who think this is no big deal, imagine if during the Bush Administration the IRS targeted political groups that were “progressive” for special scrutiny.
And we should not lose sight of the need for serious disclosure reform, to deal fairly and fully with shadow super PACs which have taken the 501c4 and other forms to avoid constitutional disclosure of large amounts of money being used to fund election advertising.