WASHINGTON -- An inspector general report into the Internal Revenue Service's heightened scrutiny of Tea Party groups blames "ineffective management" at the agency, but does not address whether the policy was politically motivated.
The Treasury Inspector General for Tax Administration's report, released Tuesday, was an audit -- not an investigative report. It made recommendations about how tax-exempt applications should be processed in the future. It did not blame specific employees or suggest disciplinary action.
The report found the IRS office in Cincinnati, which processes all applications for tax-exempt status, singled out "Tea Party," "Patriot" and "9/12" groups based solely on their names. The applications were singled out for further review of whether they were involved in political campaign activity. The groups were applying for tax exempt status reserved for groups that conduct "social welfare" activities as the bulk of their work.
The IRS's special treatment of Tea Party applications led to long processing delays, the inspector general said. For 13 months beginning in October 2010, the Cincinnati office stopped working on potential political cases entirely.
The report said 170 groups received IRS letters asking for additional information, and in 98 of those cases the questions asked were later determined to be inappropriate or unnecessary. Those questions included the names of donors, the political affiliation of officers, and their employment outside the organization.
In a response to the draft report, the IRS defended its decision to separate out groups involved in potential political activities. "While centralization was warranted, the manner in which we initially designated cases for centralization was inappropriate," wrote Joseph H. Grant, the acting commissioner for tax exempt and government entities.
He also said determining which groups are engaged in prohibited political activity is difficult: "There are no bright line tests for what constitutes political campaign intervention ... or whether an organization is primarily engaged in social welfare activities," Grant said.
Some of the nation's pioneer tea party organizers are based in Metro Atlanta. Debbie Dooley, and others involved with creating the national group, "Tea Party Patriots," said Tuesday night that the IRS demanded copies of their donor lists and other "intrusive" information.
"After the election, 2010, beginning in 2011, we began to get stalling tactics, we began to see things where they [the IRS] actually asked -- they were very intrusive," Dooley said. "Especially toward the end of 2011, the beginning of 2012. They began to send us information actually [asking] for who our donor list was, they wanted to know the names of our volunteers, what Congressmen supported us, the names of them. We have a Facebook page. They wanted us to take screen shots of what our supporters were posting on our Facebook page, and send it to them, to go back a year.... I fully believe it was deliberate intimidation on the IRS part, because tea parties were quite successful in the 2010 elections, they wanted to intimidate us so we would not be active, so we would be afraid to do anything."
Attorney General Eric Holder has launched a Justice Department/FBI investigation, "to see if any laws were broken." Holder said that the IRS practices regarding tea party groups "were, I think as everyone can agree, if not criminal, they were certainly outrageous and unacceptable."
Dooley and others in Metro Atlanta are calling for an independent investigation of the IRS.
"Definitely do not have faith in the Eric Holder Justice Department," Dooley said, "because he answers to the Obama Administration, just like the IRS does, they're part of the Department of Treasury and President Obama appoints the Treasury Secretary. We are exploring different avenues for court action, we believe the individual agents that were responsible for this should be held accountable, there should be a criminal investigation by an independent body, they should lose their jobs, and we're also investigating to see if we can actually file legal action against the IRS personnel individually that engaged in this."
The House Ways and Means Committee will hold a hearing on Friday, looking into the revelations about the IRS. A co-founder of Tea Party Patriots, Jenny Beth Martin of Woodstock, is in Washington and plans to attend that hearing.
"This is wrong," Dooley said. "Our friends on the left need to understand that if the IRS gets away with just a slap on the wrist or an apology, it's just a matter of time before you will have a Republican administration that will feel emboldened to go after groups on the left."
Gregory Korte, USA Today, in Washington@gregorykorte
Jon Shirek, 11Alive News, in Atlanta @JonShirek