Report says IRS management to blame for treatment of conservative groups

WASHINGTON – Management flaws at the IRS contributed to a “dysfunctional culture” that allowed agents to mistreat conservative political groups when they applied for tax-exempt status, according to the results of a bipartisan congressional investigation released Wednesday.

The report by the Senate Finance Committee lays much of the blame for the scandal on former IRS official Lois Lerner, who used to head the division that processes applications for tax-exempt status. The report says Lerner waited nearly two years before informing her supervisors about long delays in the processing of applications.

Amid the scandal, the IRS didn’t perform any audits of groups that might have been engaging in improper political activity from 2010 through April 2014, the report said. This was at a time when many high-profile tax-exempt groups were spending large sums of money on political activities.

The report said managers were worried that selecting any of these groups for audits would give the impression that they were chosen because of their “political leanings.”

“Our investigation found that from 2010 to 2013, IRS management was delinquent in its responsibility to provide effective control, guidance, and direction over the processing of applications for tax-exempt status filed by Tea Party and other political advocacy organizations,” the report said.

Some groups ultimately waited as long as five years to have their applications processed, the report said.

IRS employees also improperly disclosed sensitive taxpayer information when responding to requests under the Freedom of Information Act, the report said. The employees, however, received little or no discipline.

The IRS has been under investigation by the Department of Justice and at least four congressional committees since 2013, when agency officials disclosed that agents had improperly singled out tea party and other conservative political groups when they applied for tax-exempt status.

The Finance Committee issued a series of recommendations to improve IRS management procedures.

The IRS issued a statement saying it will review the report and its recommendations.

“The IRS is fully committed to making further improvements, and we want to do everything we can to help taxpayers have confidence in the fairness and integrity of the tax system,” the IRS statement said.