IRS Rejects KEY Inspector General Recommendations Designed To Prevent Another Scandal

One of the thousands of "changing the light bulb" jokes asks, "how many psychiatrists does it take to change a light bulb?" the answer is "one--but first it has to want to change."  Today we learned that the IRS does not want to change as it rejected key Inspector General recommendations to prevent another scandal like the one that broke Friday.

The  inspector general recommended more transparency, that the IRS do a better job documenting the reasons why its agents believe certain applications need special attention, such as when they suspect a group’s political actions may be crossing a line that would disqualify it for tax-exempt status. 

The IRS said it would review its procedures and decide if and how much more documentation was needed.

The report  also recommended the IRS develop more standardized procedures for agents regarding how to process tax-exemption requests from groups they suspect aren’t be eligible due to political activity. It also suggested the new guidelines be posted to the internet to promote transparency to organizations on the application process.


Instead of the new guidelines the IRS said it will provide more training on how to handle potential political intervention matters.”

In both cases, the IRS suggested it worried the recommendations would further burden a system already fraught with lengthy delays. To make its point, the agency said that between 2008 and 2012 the number of groups seeking 501(c)(4) tax exemptions more than doubled.

The IRS added that much of its workload was dedicated to checking out the “numerous referrals from the public, media, watchdog groups and members of the Congress alluding that specific 501(c)(4) organizations were engaged in political campaign activity to an impermissible extent.”

But the inspector general said neither IRS alternative was good enough, adding that until the agency makes changes to close out all of its outstanding tax-exempt applications, “we do not consider the concerns in this report to be resolved.”

The IRS has always been seen as some big tyrannical organization lurking behind ever aspect of your lives, always ready to spring out with a letter, threat or audit.  This scandal demonstrates that just like its reputation,  the IRS may be able to away with almost everything.  This agency needs to have more established rules and more transparency. If he truly wants to fix this IRS problem, President Obama should force the agency to accept and enact these recommendations in the Inspector General's report.