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U.S. Senate investigators split on party lines over IRS scandal

WASHINGTON (Reuters) – Democratic Senate investigators criticized a watchdog for the U.S. Internal Revenue Service on Friday for “inaccurately and unfairly” damaging public confidence in the tax agency’s political impartiality.

Republican investigators disagreed, defending the job done by the Treasury Inspector General for Tax Administration (TIGTA) last year in reviewing the IRS’ handling of tax-exemption applications received from political groups.

A starkly split, 222-page report from the Senate Permanent Subcommittee on Investigations displayed continued partisan discord over an affair that burst into view in May 2013 and quickly enmeshed the IRS in its worst scandal in decades.

Last year’s controversy stemmed from allegations IRS agents had singled out applications for tax-exempt status from the Tea Party movement and other conservative political groups for extra scrutiny. When a senior IRS executive apologized over the issue, a furor ensued that led to the resignation of the chief of the IRS, multiple investigations and hearings and bipartisan condemnation of the tax agency.

In the subcommittee report, Democrats said IRS staffers had targeted both conservative and liberal non-profits for unfair scrutiny, while Republicans once again complained that conservative groups got disproportionately worse IRS treatment.

The Democrats singled out TIGTA for especially harsh criticism, however. The independent watchdog is headed by J. Russell George, a lawyer who was nominated by former Republican President George W. Bush and confirmed by the Senate in November 2004.

Just days after the IRS targeting program for tax-exemption applications erupted into view, TIGTA issued an audit report that had been underway for months on the IRS’ conduct.

The audit report focused chiefly on scrutiny of conservative groups and pointed to “inappropriate criteria” being used at the IRS for selecting applications for closer review and “ineffective management.” This drew wide public attention and inflamed Republicans’ indignation over the IRS’ conduct.

Senate subcommittee Democrats said TIGTA left out of its audit report that both conservative and liberal groups were mistreated by IRS agents, and that TIGTA investigators, in early inquiries, found no indications of political bias at the IRS.

“TIGTA management failed to adequately supervise and ensure a balanced audit process, excluded key information from the audit report, omitted the key determination that the audit had ‘found no evidence of political bias,’ and inaccurately and unfairly damaged public confidence in the impartiality of the IRS,” said the Democrats’ section of the subcommittee report.

A TIGTA spokesperson said in an email: “We are in receipt of the report and are in the process of reviewing its contents.”

In their section of the subcommittee report, Republicans said TIGTA’s audit of the IRS was valid and “adequately covered the relevant material.”

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