The IRS conspiracy theory begins to come undone

Posted by AzBlueMeanie:

It appears the worm has turned on the conservative media entertainment complex cult's IRS "scandal" conspiracy theory. Upon a deeper dive into the facts by responsible media over the hysteria and persecution complex scandal mongering of wingnuttia, a defense of the IRS is emerging.

The New York Times reported yesterday Groups Targeted by I.R.S. Tested Rules on Politics:

Representatives of [Tea Party] organizations have cried foul in recent weeks
about their treatment by the I.R.S., saying they were among dozens of
conservative groups unfairly targeted by the agency, harassed with
inappropriate questionnaires and put off for months or years as the
agency delayed decisions on their applications.

But a close examination of these groups and others reveals an array of
election activities that tax experts and former I.R.S. officials said
would provide a legitimate basis for flagging them for closer review.

“Money is not the only thing that matters,” said Donald B. Tobin, a
former lawyer with the Justice Department’s tax division who is a law
professor at Ohio State University. “While some of the I.R.S. questions
may have been overbroad, you can look at some of these groups and
understand why these questions were being asked.”

The I.R.S. is already separately reviewing roughly 300 tax-exempt groups
that may have engaged in improper campaign activity in past years,
according to agency planning documents. Some election lawyers said they
believed a wave of lawsuits against the I.R.S. and intensifying
Congressional criticism of its handling of applications were intended in
part to derail those audits, giving political nonprofit organizations a
freer hand during the 2014 campaign.

After the tax agency was denounced in recent weeks by President Obama,
lawmakers and critics for what they described as improper scrutiny of at
least 100 groups seeking I.R.S. recognition, The New York Times
examined more than a dozen of the organizations, most of them organized
as 501(c)(4) “social welfare” groups under the tax code, or in some
cases as 501(c)(3) charities. None ran major election advertising
campaigns, according to the Campaign Media Analysis Group, the main
activity of a small number of big-spending tax-exempt groups that
emerged as major players in the 2010 and 2012 elections.

But some organized volunteers, distributed pamphlets and held rallies
leading up to the 2010 elections or the 2012 presidential election, as
conservatives fought to turn out Mr. Obama.

A report issued this month by the Treasury Department’s inspector
general, J. Russell George, found that inappropriate criteria, including
groups’ policy positions, were used to flag some cases and that
specialists in the I.R.S. office in Cincinnati, which reviews all
tax-exemption requests, sometimes asked questions that were irrelevant
to the application process.

And agency officials have acknowledged that specialists inappropriately
used keywords like “Tea Party” and “Patriots” in searching through
applications.

But some former I.R.S. officials disputed several of Mr. George’s
conclusions, including his assertion that it was inappropriate to ask
groups about their donors, or whether their leaders had plans to run for
public office. While unusual, the former officials said, such questions
are not prohibited if relevant to an application under consideration.

“The I.G. was as careless with terminology as the Cincinnati office
was,” said Marcus S. Owens, who headed the I.R.S.’s exempt organizations
division until 2000. “Half of those questions have been found to be
germane in court decisions.”

I.R.S. agents are obligated to determine whether a 501(c)(4) group is
primarily promoting “social welfare.” While such groups are permitted
some election involvement, it cannot be an organization’s primary
activity. That judgment does not hinge strictly on the proportion of
funds a group spends on campaign ads, but on an amorphous mix of facts
and circumstances.

“If you have a thousand volunteer hours and only spend a dollar, but
those volunteers are to help a particular candidate, that’s a problem,”
Mr. Tobin said.

Agents may examine when and for how long a group advocates policy
positions, in part to see whether those positions are associated with a
specific candidate, which can be relevant to the group’s tax status, tax
lawyers and former I.R.S. officials said.

Agents may look at what a group publishes in print or on a Web site,
whether it provides funds to other organizations involved in elections
or whether a group’s officers are also employed by political parties.
They may also consider other public information, former officials and
tax experts said, though they are required to ask the organization to
provide those materials or comment on them before the information can be
included in an application review.

“My experience has been that the agents immediately start Googling to
see what the organization is doing outside of the application,” said
Kevin J. Shortill, a former tax law specialist in the I.R.S.’s exempt
organization division. “And that explains why you get these requests for
information like, ‘Please print out your Web site and send it in.’ ”

* * *

At least some of the conservative groups that are complaining about
I.R.S. treatment were clearly involved in election activities on behalf
of Republicans or against Democrats. When CVFC, the veterans’ group,
first applied for I.R.S. recognition in early 2010, it stated that it
did not plan to spend any money on politics. The group, whose full name
in its application was CVFC 501(c)(4), listed an address shared with a
political organization called Combat Veterans for Congress PAC. CVFC
told the I.R.S. that it planned to e-mail veterans about ways in which
they “may engage in government” and provide “social welfare programs to
assist combat veterans to get involved in government.”

* * *

Some groups appeared to be confused or misinformed about the I.R.S. rules applying to their activity.

Steve Benen points out in this post Watching a scandal slowly 'metastasize' that other responsible media organizations have taken a deeper dive into the facts and found that this IRS "scandal" conspiracy theory really was the result of lower level IRS employees being overwhelmed by a flood of 501(c)(4) applications:

Over the last week or so, we've seen several detailed reports — from the Wall Street Journal, the Washington Post, and the New York Times,
among others — each of which say roughly the same thing: officials
with little direction or legal clarity struggled to implement vague
guidelines.

And barring additional information, that's pretty much
the end of the story as it relates to the White House. For all the talk
on the right about President Obama's possible involvement in the
matter, there's just nothing to even hint in that direction.

The result, Jon Chait argues, is a "metastasizing" controversy, created by desperate conservatives.

* * *

But I remain fascinated by the ever-changing trajectory of the allegations, which have quickly become incoherent.

Phase One: Maybe the Obama White House gave orders to the IRS!

Phase Two: We demand to know why the Obama White House didn't give orders to the IRS!

Phase Three: The president must have known what was going on at the IRS!

Phase Four: We demand to know why the president didn't know what was going on at the IRS!

Phase Five: Never mind all that other stuff, maybe the president ordered IRS audits on Republicans!

Look,
this is getting a little silly. If Republicans want the American
mainstream to see this as a legitimate "scandal," they're going to have
to get their story straight. Because at this point, listening to the
White House's GOP critics get increasingly confused about details they should understand by now is getting a little tiresome.

Perhaps the best commentary on the IRS "scandal" conspiracy theory is the satirical treatment by Stephen Colbert last week on The Colbert Report in a bit called the Mazda Scandal Booth. Colbert has his own 501(c)(4). “So you can form a 501 (c) (4) without asking to form one?” he asks. Yes indeed. “So these tea party, anti-big government organizations didn’t have to ask big government for permission, but they did anyway?” he asks.  Yes they did. “What a bunch of pussies,” Colbert replies mockingly.

Part 1

Part 2