IRS’ tea party admission was planned

WASHINGTON – Tough congressional grilling Friday of fired IRS chief Steven Miller failed to get answers about which agency employees subjected applications from tea party groups to special scrutiny but yielded a startling new admission: The Internal Revenue Service actually planted the question posed at a legal conference a week earlier that triggered the current political storm.

Miller, fired Wednesday by President Barack Obama, parried with lawmakers during a nearly four-hour hearing by the House Ways and Means Committee. He defended as proper the actions taken by IRS employees who selected for close scrutiny tea party groups and other conservative organizations, arguing that the term “targeting” was pejorative.

What lower-level employees did, Miller insisted, was use terms such as “tea party” and “patriot” as shortcuts to identify groups that might not actually be social welfare organizations as required, but rather political groups with campaign motives. Once their actions were known to higher-ups, changes were made.

But Republican lawmakers pushed back, reading from the IRS questionnaires reportedly sent by agency officials to some of the conservative groups, questions about the content of prayers read and what is written on signs that would be displayed during pickets of groups such as Planned Parenthood.

Those sorts of questions led Rep. Kevin Brady, R-Texas, to accuse the Obama administration of being “drunk on power.” Brady alleged that some Texas tea party advocates were harassed by other branches of the government, ranging from the FBI to Labor Department inspectors.

“The broader question here is, is this still America?” Brady asked.

While the televised hearings were full of bombastic theatrics, they also revealed important new information. Miller acknowledged that the Washington-based IRS executive who sparked the controversy with her apology for inappropriate treatment of tea party applications for tax-exempt status did so when answering a question planted by the agency itself.

The original IRS narrative was that Lois Lerner, the internal director who oversees approval of tax-exempt entities, let the apology slip when answering a question at a May 10 conference by the American Bar Association. The question was asked by Celia Roady, a tax partner in the law firm of Morgan, Lewis & Bockius, who later told Reuters that she was surprised to get an answer.

Roady sits on the IRS advisory committee for tax-exempt entities, and Miller acknowledged to Rep. Devin Nunes, R-Calif., on Friday that Lerner answered a question first suggested by the agency itself.

Asked Nunes: “Was Ms. Roady’s question to Ms. Lerner about targeting conservative groups planned in advance?”

Miller responded: “I believe that we talked about that, yes.”

Miller also revealed that the woman who previously headed Lerner’s division was not punished for the action of her subordinates and instead was promoted. He called the woman, Sarah Hall Ingram, a “superb” employee who now heads a division responsible for implementing the tax provisions related to the Affordable Care Act health care law. Republican lawmakers said she had received more than $100,000 in bonuses, even though during the hearing Miller had said the IRS division she headed had displayed “horrible customer service.”

At the same hearing, the Treasury Department’s inspector general for tax administration offered some important new timelines. J. Russell George, a Bush administration appointee, told lawmakers he informed former IRS Commissioner Doug Shulman on May 30, 2012, of the forthcoming audit into alleged targeting of conservative groups.

Both Shulman and Miller, who took over as acting chief in November, had told Congress last year that no targeting was happening. Shulman and Miller will both appear before the Senate Finance Committee on Tuesday.

George also testified that he informed the Treasury Department’s general counsel about the audit on June 4, 2012, and the now-No. 2 man at Treasury, Neal Wolin, days later. The pending audit also had been published on the inspector general’s webpage.

George said he briefed new Treasury Secretary Jacob Lew on the report soon after Lew took the helm Feb. 28, well after the IRS policy in question had been halted.