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IRS chief announces reforms in wake of furor over targeting of conservative groups

Trying to clean up the mess at the Internal Revenue Service after revelations that the agency targeted conservative groups who had applied for tax-exempt status, Internal Revenue Service Principal Deputy Commissioner Danny Werfel announced Monday that an initial internal IRS review found no evidence of intentional wrongdoing by IRS personnel or involvement by parties outside the IRS.  However Werfel’s report notes that investigations are still under way.

In addition to the internal IRS probe, congressional committees are investigating how and why the targeting took place and who ordered it.

In late May former IRS official Lois Lerner, who led the IRS tax-exempt unit, invoked her Fifth Amendment right against self-incrimination when she was called before the House Oversight and Government Reform Committee.

Werfel also announced Monday that he had set up a new process to help applicants gain fast-track approval to operate as a 501(c)(4) tax-exempt group. The new process would apply to groups whose applications for tax-exempt status have been in the IRS application backlog for more than 120 days. 

Werfel also said the IRS had suspended the use of "be-on-the-lookout," or BOLO lists in the application process for tax-exempt status.

Werfel was appointed by President Barack Obama on May 16 after a report from the Treasury Inspector General for Tax Administration found that starting in 2010 the IRS had used “inappropriate criteria to identify applications from organizations with the words Tea Party in their names.”

Later, IRS officials “expanded the criteria to inappropriately include organizations with other specific names (Patriots and 9/12) or policy positions.”

The House Ways and Means Committee will hear testimony from Werfel on Thursday. Committee Chairman Rep. Dave Camp, R- Mich., said, “While the committee continues a methodical investigation that includes interviewing IRS officials, reviewing internal IRS documents, and talking to those who were targeted, it is also important that we hear from IRS leadership about what immediate steps the agency has undertaken to address these actions.”

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