May 16, 2013

Obama picks budget official to run troubled IRS

Daniel Werfel will replace ousted acting Commissioner Steven Miller, as one of Miller's top deputies announces he'll retire.

The Associated Press

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On Thursday, Obama dismissed the idea of a special prosecutor, saying probes by Congress and the Justice Department should be able to figure out who was responsible.

"Between those investigations I think we're going to be able to figure out exactly what happened, who was involved, what went wrong, and we're going to be able to implement steps to fix it," Obama said at a Rose Garden press conference.

Obama promised to work with Congress in its investigations, and he reiterated that he did not know that conservative groups were targeted until it became public last Friday.

"I promise you this, that the minute I found out about it, then my main focus was making sure that we get the thing fixed," Obama said.

Don't look for the controversy to subside.

Three congressional committees are investigating, and the FBI has launched a criminal probe.

On Friday, Miller is scheduled to testify before the House Ways and Means Committee. Also testifying is J. Russell George, the Treasury inspector general for tax administration.

Ways and Means Committee members are expected to grill Miller over why he failed to tell lawmakers that conservative groups were targeted, even after the agency said he was briefed in May 2012.

At least twice after the briefing, Miller wrote letters to members of Congress to explain the process of reviewing applications for tax-exempt status without disclosing that tea party groups had been targeted. On July 25, 2012, Miller testified before the House Ways and Means oversight subcommittee but again was not forthcoming on the issue — despite being asked about it.

"The IRS has demonstrated a culture of cover up and has failed time and time again to be completely open and honest with the American people," said Rep. Dave Camp, R-Mich., chairman of the Ways and Means Committee. "The committee and the American people deserve honest answers from Mr. Miller at our hearing this Friday."

The groups were applying for tax-exempt status as social welfare organizations. Unlike other charitable groups, social welfare organizations can engage on politics but it is not supposed to be their primary mission.

It is up to the IRS to make the determination.

The inspector general's report said that if agents saw the words "Tea Party" or "Patriots" in an application, they automatically set it aside for additional scrutiny. The agents did not flag similar progressive or liberal labels, though some liberal groups did receive additional scrutiny because their applications were singled out for other reasons, the report said.

Miller, a 25-year career civil servant at the IRS, took over the agency in November, when the five-year term of Commissioner Douglas Shulman ended. Shulman was appointed by President George W. Bush.

At the time when tea party groups were targeted, Miller was a deputy commissioner and Grant's supervisor.

Miller was to return to his job as a deputy commissioner when he was finished being the acting head of the agency. But he announced his resignation from that position Wednesday.

The Senate Finance Committee said it will hold a hearing on the matter Tuesday. The House Oversight Committee is to hold a hearing Wednesday.

On Thursday, Senate Republicans called for yet another investigation into whether agents in the same Cincinnati office that targeted conservative groups released confidential taxpayer information from some of those groups.

The Journalism website ProPublica reported this week that the IRS had released nine pending confidential applications of conservative groups to ProPublica late last year.

The IRS said in a statement that the inspector general already had investigated the matter, and "found these instances to be inadvertent and unintentional disclosures by the employees involved."

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