It’s unclear whether the release, which consisted of confidential applications of conservative groups, was accidental.
Tuesday, May 14 update from ProPublica:
The same IRS office that deliberately targeted conservative groups applying for tax-exempt status in the run-up to the 2012 election released nine pending confidential applications of conservative groups to ProPublica late last year.
The IRS did not respond to requests Monday following up about that release, and whether it had determined how the applications were sent to ProPublica.
In response to a request for the applications for 67 different nonprofits last November, the Cincinnati office of the IRS sent ProPublica applications or documentation for 31 groups. Nine of those applications had not yet been approved—meaning they were not supposed to be made public. (We made six of those public, after redacting their financial information, deeming that they were newsworthy.)
On Friday, Lois Lerner, the head of the division on tax-exempt organizations, apologized to Tea Party and other conservative groups because the IRS’ Cincinnati office had unfairly targeted them. Tea Party groups had complained in early 2012 that they were being sent overly intrusive questionnaires in response to their applications.
That scrutiny appears to have gone beyond Tea Party groups to applicants saying they wanted to educate the public to “make America a better place to live” or that criticized how the country was being run, according to a draft audit cited by many outlets. The full audit, by the Treasury Department’s inspector general for tax administration, will reportedly be released this week. (ProPublica was not contacted by the inspector general’s office.)
Before the 2012 election, ProPublica devoted months to showing how dozens of social-welfare nonprofits had misled the IRS about their political activity on their applications and tax returns. Social-welfare nonprofits are allowed to spend money to influence elections, as long as their primary purpose is improving social welfare. Unlike super PACs and regular political action committees, they do not have to identify their donors.
In 2012, nonprofits that didn’t have to report their donors poured an unprecedented $322 million into the election. Much of that money — 84 percent — came from conservative groups.
As part of its reporting, ProPublica regularly requested applications from the IRS’s Cincinnati office, which is responsible for reviewing applications from nonprofits.
Social welfare nonprofits are not required to apply to the IRS to operate. Many politically active new conservative groups apply anyway. Getting IRS approval can help with donations and help insulate groups from further scrutiny. Many politically active new liberal nonprofits have not applied.
Applications become public only after the IRS approves a group’s tax-exempt status.
On Nov. 15, 2012, ProPublica requested the applications of 67 nonprofits, all of which had spent money on the 2012 elections. (Because no social welfare groups with Tea Party in their names spent money on the election, ProPublica did not at that point request their applications. We had requested the Tea Party applications earlier, after the groups first complained about being singled out by the IRS. In response, the IRS said it could find no record of the tax-exempt status of those groups — typically how it responds to requests for unapproved applications.)
Just 13 days after ProPublica sent in its request, the IRS responded with the documents on 31 social welfare groups.
One of the applications the IRS released to ProPublica was from Crossroads GPS, the largest social-welfare nonprofit involved in the 2012 election. The group, started in part by GOP consultant Karl Rove, promised the IRS that any effort to influence elections would be “limited.” The group spent more than $70 million from anonymous donors in 2012.
Applications were sent to ProPublica from five other social welfare groups that had told the IRS that they wouldn’t spend money to sway elections. The other groups ended up spending more than $5 million related to the election, mainly to support Republican presidential candidate Mitt Romney. Much of that money was spent by the Arizona group Americans for Responsible Leadership. The remaining four groups that told the IRS they wouldn’t engage in political spending were Freedom Path, Rightchange.com II, America Is Not Stupid and A Better America Now.
The IRS also sent ProPublica the applications of three small conservative groups that told the agency that they would spend some money on politics: Citizen Awareness Project, the YG Network and SecureAmericaNow.org. (No unapproved applications from liberal groups were sent to ProPublica.)
The IRS cover letter sent with the documents was from the Cincinnati office, and signed by Cindy Thomas, listed as the manager for Exempt Organizations Determinations, whom a biography for a Cincinnati Bar Association meeting in January says has worked for the IRS for 35 years. (Thomas often signed the cover letters of responses to ProPublica requests.) The cover letter listed an IRS employee named Sophia Brown as the person to contact for more information about the records. We tried to contact both Thomas and Brown today but were unable to reach them.
After receiving the unapproved applications, ProPublica tried to determine why they had been sent. In emails, IRS spokespeople said ProPublica shouldn’t have received them.
“It has come to our attention that you are in receipt of application materials of organizations that have not been recognized by the IRS as tax-exempt,” wrote one spokeswoman, Michelle Eldridge. She cited a law saying that publishing unauthorized returns or return information was a felony punishable by a fine of up to $5,000 and imprisonment of up to five years, or both.
In response, ProPublica’s then-general manager and now president, Richard Tofel, said, “ProPublica believes that the information we are publishing is not barred by the statute cited by the IRS, and it is clear to us that there is a strong First Amendment interest in its publication.”
ProPublica also redacted parts of the application to omit financial information.
Jonathan Collegio, a spokesman for Crossroads GPS, declined to comment today on whether he thought the IRS’s release of the group’s application could have been linked to recent news that the Cincinnati office was targeting conservative groups.
Last December, Collegio wrote in an email: “As far as we know, the Crossroads application is still pending, in which case it seems that either you obtained whatever document you have illegally, or that it has been approved.”
This year, the IRS appears to have changed the office that responds to requests for nonprofits’ applications. Previously, the IRS asked journalists to fax requests to a number with a 513 area code — which includes Cincinnati. ProPublica sent a request by fax on Feb. 5 to the Ohio area code. On March 13, that request was answered by David Fish, a director of Exempt Organizations Guidance, in Washington, D.C.
In early April, a ProPublica reporter’s request to the Ohio fax number bounced back. An IRS spokesman said at the time the number had changed “recently.” The new fax number begins with 202, the area code for Washington, D.C.
May 13 report via the Associate Press:
WASHINGTON — Republicans say the Internal Revenue Service’s targeting of conservative political groups was “chilling”, and at least one Republican senator called on President Barack Obama to “personally condemn” the actions.
The IRS, an independent agency in the Treasury Department, has already apologized for scrutinizing the tax-exempt status of groups with conservative titles such as “Tea Party” or “Patriot” in their names. And White House spokesman Jay Carney said Friday it was wrong.
But Sen. Susan Collins, R-Maine, said Sunday she was disappointed that Obama “hasn’t personally condemned this.” The president, Collins said, “needs to make crystal clear that this is totally unacceptable.”
Collins and other Republicans challenged the tax agency’s claim that the practice was initiated by low-level workers.
“I just don’t buy that this was a couple of rogue IRS employees,” said Sen. Susan Collins, R-Maine. “After all, groups with ‘progressive’ in their names were not targeted similarly.”
If it were just a small number of employees, she said, “then you would think that the high-level IRS supervisors would have rushed to make this public, fired the employees involved, apologized to the American people and informed Congress. None of that happened in a timely way.”
The IRS said Friday that it was sorry for what it called the “inappropriate” targeting of the conservative groups during the 2012 election to see if they were violating their tax-exempt status. The agency blamed low-level employees, saying no high-level officials were aware.
But according to a draft of a watchdog’s report obtained Saturday by The Associated Press that seemingly contradicts public statements by the IRS commissioner, senior IRS officials knew agents were targeting tea party groups as early as 2011.
The Treasury Department’s inspector general for tax administration is expected to release the results of a nearly yearlong investigation in the coming week.
Lois G. Lerner, who heads the IRS division that oversees tax-exempt organizations, said last week that the practice was initiated by low-level workers in Cincinnati and was not motivated by political bias.
But on June 29, 2011, Lerner learned at a meeting that groups were being targeted, according to the watchdog’s report. At the meeting, she was told that groups with “Tea Party,” ”Patriot” or “9/12 Project” in their names were being flagged for additional and often burdensome scrutiny, the report says.
The 9/12 Project is a group started by conservative TV personality Glenn Beck.
Rep. Mike Rogers, R-Mich., said “the conclusion that the IRS came to is that they did have agents who were engaged in intimidation of political groups is as dangerous a problem” as the government can have.
He added, “This should send a chill up your spine. … I don’t know where it stops or who is involved.”
Congressional Republicans already are conducting several investigations and asked for more.
“This mea culpa is not an honest one,” said Rep. Darrell Issa, R-Calif.
After the Associated Press report, Carney said that if the inspector general “finds that there were any rules broken or that conduct of government officials did not meet the standards required of them, the president expects that swift and appropriate steps will be taken to address any misconduct.”
Collins said the revelations about the nation’s tax agency only contribute to “the profound distrust that the American people have in government. It is absolutely chilling that the IRS was singling out conservative groups for extra review.”
The IRS’ Lerner said that about 300 groups were singled out for additional review, with about one-quarter scrutinized because they had “tea party” or “patriot” somewhere in their applications.
She said 150 of the cases have been closed and no group had its tax-exempt status revoked, though some withdrew their applications.
Collins appeared on CNN’s “State of the Union,” Rogers was on “Fox News Sunday” and Issa spoke on NBC’s “Meet the Press.”