Ezra Klein on the IRS

A few questions on the IRS scandal.

1) The core issue here is that the IRS was using the term “tea party” and its associated language as a flag for organizations that might be more political than the 501(c)4 designation permitted. As Juliet Eilperin writes, this kind of category-based approach to choosing which applications require more scrutiny is typical for the IRS. It’s even used in individual tax returns. The question was whether, when it came to the 501(c)4 groups, the only kind of political activity being rigorously screened was conservative political activity. Was tea party language the only red flag? Or did other kinds of politicized language set off alarm bells, too? If so, what was that language?

2) Was the Cincinnati office the only one that used the tea-party test or was it more widely applied? The fact that some tea party groups received scrutiny from Washington-based IRS employees doesn’t answer that question. We should expect tea party groups to get scrutiny when they apply for non-political 501(c)4 designation. The question is whether their applications were flagged through a politically discriminatory test that existed in other agencies, too.

3) Did the IRS higher-ups act appropriately? Right now, much of the reporting indicates that IRS higher-ups shut this down pretty much as soon as they heard about it. Their sin, if there was one, was that they didn’t disclose that anything had gone awry when asked whether the IRS was targeting conservative groups. But they may also have thought that this wasn’t targeting conservative groups — it was simply a reasonable, but ultimately unwise, way of filtering politicized applications for appropriate scrutiny. The IG report should tell us more on this score.

4) In which direction does our outrage point? Do we think the tea party groups really are primarily non-political social welfare organizations and they should’ve received 501(c)4 designation more smoothly? Or do we think that they’re clearly political organizations and their applications should’ve been closely scrutinized and maybe even rejected – but so too should the applications from a host of other politicized groups on the left and the right?

5) Do we want a personnel outcome, a political outcome, or a policy outcome? Is the right endgame simply that some IRS employees get fired? That the Obama administration gets embarrassed? Or is that Congress tightens the language governing who does and doesn’t qualify for 501(c)4 status so that the IRS doesn’t have so much discretion — and career employees don’t resort to these confused tactics — when reviewing applications? Note that if we go the legislative route, we could either widen the 501(c)4 designation, making it clear that political groups qualify, or we could narrow it, making it clear that they don’t.

The answers to these questions would go a long way in clarifying whether we have a real scandal or simply a bad filtering process on our hands, and what we should do about it.

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2 responses to “Ezra Klein on the IRS

  1. Why isn’t the press asking these questions? Could it be that they are politically motivated? Do they really not understand that the IRS had a legitimate right, no…the obligation to investigate these groups?

    Seems to me, this is much ado about nothing. The Republicans are once again strutting and fretting their hour upon the stage. If only they would be heard no more.

  2. Renee Westa-Lusk

    No one in our government including elected officials that know this subject much better than what the media KNOWS is coming out to set the record straight and state that the IRS is and was doing its job to scrutinize tax exempt organizations 501cs for political activity. These groups should be scrutinized for political activity and if they are doing political activity they should start filing state required political activity reports as well as FEC reports (if involved in federal campaigns) and should LOSE THEIR TAX EXEMPT STATUS. I am very upset that the IRS is being chastised for doing their job. I have seen blatant political activity by churches and a college faculty member using their editorial skills to tell people who to vote for before an election and I never saw the IRS in previous administrations do anything about these activities. THE PUBLIC DOESN’T SEEM TO KNOW THAT POLITICAL ORGANIZATIONS DO NOT PAY TAXES AND THEREFORE ARE NOT UNDER THE JURISDICTION OF THE IRS UNLESS THEY TRY TO CLAIM TAX EXEMPT STATUS—WHICH IS A VIOLATION.

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