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January 17, 2017 / 19 Tevet, 5777

Posts Tagged ‘IRS’

IRS Told to Surrender Documents Containing ‘Israel’ ‘Zion’ ‘West Bank’ ‘Judea’ ‘Samaria’ and ‘Special Israel Policy’

Wednesday, December 21st, 2016

The IRS has been ordered to surrender all documents since January 1, 2009 containing the words “Israel,” “Zion,” “West Bank,” “Judea,” Samaria,” and “Special Israel Policy” for review by Congress.

Late Tuesday night Israel time, investigative journalist Omri Ceren posted on the Twitter social networking site a copy of a letter dated December 14, 2016, that was sent to IRS Commissioner John Koskinen, by House Ways and Means Committee co-chairs, U.S. Representatives Kevin Brady and Peter Rosam.

It said, in part:

“Although the Internal Revenue Service as vowed that it no longer considers inappropriate criteria, such as organization’s political beliefs, when reviewing applications for tax-exempt status, the Committee on Ways and Means remains concerned that IRS practices and policies may illegally target Americans and organizations based on their beliefs – in particular, their support for the State of Israel.

“… the Committee seeks documents from the IRS to understand how the IRS has treated tax-exempt organizations connected to Israel with viewpoints different than the Administration’s in the past and how the IRS plans to treat such organizations in the future…

“One such pro-Israel organization, Z Street, applied for tax-exempt status in 2009. After much delay in the application process, an IRS agent confirmed to Z Street that its application had been sent for special screening reserved for groups associated with Israel…

“It is distressing that the United States government subjected Americans to discriminatory treatment because of their political and religious beliefs,” the letter continues. “It is more distressing that it took seven years for one such group to get fair treatment by the IRS, even as the IRS told Congress that it no longer discriminated against such groups. And perhaps most alarmingly, recent press accounts suggest that even after all of this history, the IRS might even be pursuing new discriminatory policies. Reports state that the Administration is considering the possibility of pressuring Israel to make unilateral concessions to the Palestinians, such as through a United Nations Security Council Resolution, and in that context, also may consider new IRS actions that would affect the tax-exempt status of people or entities based on their viewpoints regarding Israel. Despite the IRS’s claim to Congress that it stopped political targeting in 2013, the IRS and Administration’s actions over the past seven years lend credibility to these reports…

“To help the Committee better understand the IRS’s historical and current position in these matters, please provide no later than 5:00 p.m., January 11, 2017, all documents dating from January 1, 2009, to the present to, from, or within the IRS, containing the words, “Israel”; “Zion”; “West Bank”; “Judea”; “Special Israel Policy”; and/or “Samaria.”

Beginning in 2011, Americans living in Israel began to hear stories circulating about friends or family members who also had immigrated on aliyah, or who were involved in Israel-linked activities, who were suddenly receiving notices from the IRS that their U.S. income tax returns for the years 2009 and/or 2010 were under audit.

One American living in Israel who has requested anonymity due to fears of retribution told JewishPress.com that during the process of untangling the long and “intimidating” audit, the IRS case manager assigned to the account said bluntly that American taxpayers whose “returns were coming in from Israel and who were getting money back for any reason, were being red-flagged.”

Now the House Ways and Means Committee of the U.S. Congress is ordering the IRS to turn over any and all documents that will reveal whether the Obama Administration has truly been engaged in a “Special Israel Policy.”

Hana Levi Julian

How the Trump Administration Can Stop IRS Abuse of Political Groups

Sunday, December 11th, 2016

For more than six years, the Internal Revenue Service has been trying to fend off accusations that its process for granting tax-exempt status discriminated against applicants expressing political views at odds with those of the Obama administration. This discrimination against political viewpoints the Democrats disapprove of is a clear, even astonishing, violation of the First Amendment. For that reason, the IRS has lost many more of these battles than it has won. It’s lost battles not only in court against the victimized non-profits; it’s even lost against the Treasury Department’s own inspector general, which conducted a detailed study and concluded that many of the most serious accusations of discrimination were true.

In its court battles the IRS has been represented by the Justice Department, whose job it is to represent federal agencies when they are sued. No one will be shocked to learn that under the Obama administration, and Attorneys General Eric Holder and Loretta Lynch, DOJ lawyers have used every tool at their disposal to defeat the IRS’s accusers even when those accusers are agreeing with Treasury’s inspector general. That means that, according to the Obama administration’s own inspector general report, those victimized non-profits are right in claiming that they were discriminated against because of their political views.

That litigation strategy needs to change.

Upon President Trump’s inauguration, the Justice Department will get a new boss: Jeff Sessions, President Trump’s nominee for Attorney General. The moment he takes office, General Sessions should direct the Justice Department lawyers—all of whom report to him—to change their litigation stance to reflect an important adage about how government lawyers should do business: “the government wins when justice is done.”

It’s time to see that justice is done in these cases.

Up until now, the government’s strategy has been to make the IRS cases take as long as possible and to resist every demand for discovery—the process by which litigants can request that their adversaries produce documents, or provide testimony, revealing what was really going on inside the IRS.

I represent the plaintiff in one of these cases—Z STREET v. Koskinen—which challenges the IRS’s six year delay in processing the application for tax-exempt status by an organization whose views on the Middle East were at odds with President Obama’s. In discovery, we’ve asked for information about how the IRS went about deciding what to do with (and to) our organization. But the IRS has produced virtually nothing that sheds light on its decision-making process. Other organizations in court against the IRS have been given the same treatment by the Justice Department’s litigation teams.

All of the members of those government lawyer teams report to the U.S. Attorney General. That means that when the new sheriff arrives in town he can give new orders on how these cases ought to be handled.

Attorney General Sessions should direct these lawyers to stop resisting discovery, and to stop trying to prevent the litigants—and the public—from finding out what the IRS was really doing to all of these organizations for all these years. This is not a matter of political payback, like the question whether Hillary Clinton ought to be prosecuted for what many think are her misdeeds, at the State Department and with the Clinton Foundation. It’s just a matter of letting the truth be told. Z STREET, like many of the plaintiffs in the other cases against the IRS, is not seeking money damages. We just want to know the truth about what the IRS was doing to us, and why, and at whose direction.

Another Supreme Court justice, a hero of the left, knew exactly what was called for in these cases: “Sunlight,” Justice Louis Brandeis said long ago, “is the best of disinfectants.” The nation, and the IRS itself, needs sunlight to shine on the internal doings at that agency. And letting in that light is an easy way for the new administration to fulfill one of its key promises to the electorate.

The government and the people will win when the sun is let in. Mr. Attorney General Sessions, that should happen at 12:01 pm on Friday, January 20, 2017.

Jerome M. Marcus

The IRS Scandal Still Matters

Wednesday, November 2nd, 2016

{Originally posted to the Commentary Magazine website}

Years after the Internal Revenue Service scandal broke and long after the media lost interest in the agency’s practice of subjecting conservative groups to special scrutiny and delays, the government is quietly seeking to bury it. A ruling from a federal judge earlier this month demanding that the IRS finally resolve stalled applications for non-profit status has gotten results.

Many of these small groups often affiliated with the Tea Party movement have now been granted the designation they needed to begin fundraising. Among them was Z Street, a pro-Israel group whose tax exemption request dated back to 2010. While the resolution seems to be satisfactory, the result is actually anything but. Rather than a belated triumph for justice, what has happened here is quite the opposite. Though the Z Street litigation preceded the general outrage about the revelations about the IRS’s discrimination broke in the spring of 2013, it opened a window into the way the supposedly apolitical tax agency operated. IRS personnel didn’t just make Z Street jump through hoops unknown to groups that were not associated with causes opposed by the Obama administration. An IRS agent specifically told Z Street founder Lori Lowenthal Marcus that the government gave “special scrutiny” not only to pro-Israel organizations but also to those that advocated views that “contradict those of the administration’s.”

Though the government fought a long battle to prevent Z Street—which is sympathetic to Israel’s settlement movement—from suing to recover its rights, the courts consistently upheld its right to do so. But thanks to a separate court ruling, the IRS has now waved the white flag on this case and dozens of others that all involved agents opposing or stalling requests from non-profits similarly linked to positions that were not favored by President Obama.

No one should think justice has really been done. After years of being dormant because of its inability to raise money that could be deducted as a charitable donation, Z Street has probably been dead in the water too long to recover. The same is probably true for the other “winners” in this battle. More to the point, whatever influence their educational efforts might have achieved had they been allowed to function effectively has been lost. Considering that most of these groups sought to promote ideas (though not parties or politicians) on which the 2012, 2014, and now the 2016 elections were fought, there’s no denying the fact that they were effectively silenced by a band of officious government bureaucrats pursuing the liberal agenda of the Obama administration.

Though there is still no proof that the IRS agents were acting on direct orders of the White House, their willingness to behave in this matter advanced the president’s political interests in a way that ought to stir bipartisan outrage. Unfortunately, neither Democrats nor the president’s faithful liberal media were able to see past their partisan loyalties to take effective action. Indeed, as we head toward the election of our next president, the IRS scandal has been sent down a memory hole and is largely forgotten. This wasn’t the first time the IRS has been used to advance a partisan agenda, but it isn’t likely to be the last. There is no reason to think that the pattern might not be repeated in the future once the dust settles.

That’s why it’s important that Z Street’s litigation against the IRS continue so that the courts get to the heart of the problem. For the group to get its exemption without getting answers about why it was denied so long, and who gave the order to obstruct it  is unacceptable. Though the courts may think the question is now moot, what is needed is a resolution that will point toward a constitutionally valid process for the IRS to follow, not belated government surrender to groups that were fatally undermined by an illegal policy.

This is not an issue on which conservatives and liberals ought to be divided. A government that is allowed to play fast and loose with the basic rules of fairness to disadvantage conservatives or friends of Israel could easily be employed by different people to discriminate against liberals. That’s why the IRS scandal still matters. Let’s hope the courts don’t close the file on this issue before genuine accountability is provided.

Jonathan S. Tobin

Israel Supreme Court Temporarily Blocks State From Transferring FATCA Info to IRS

Sunday, September 4th, 2016

Israel’s highest court has temporarily blocked the government from transferring the financial information of every American citizen to the U.S. Treasury in accordance with FATCA regulations, pending a September 12 hearing contending the regulation is unfair.

The Foreign Account Tax Compliance Act (FATCA) requires American taxpayers to report to the U.S. Treasury their financial information, including their bank information, if they have foreign accounts overseas. Foreign banks are also required to report information about the accounts of their American clients to the United States Treasury if the total balance equals or exceeds $50,000.

Likewise, the United States has Tax Information Exchange Agreement (TIEA) with various countries, including Israel, to ensure foreign banks report that information to the U.S. Treasury, that is required under FATCA. Dual U.S. citizens holding $10,000 or more in their accounts must report those assets by filing FBAR report.

This financial policing has made many banks and brokerage firms in Israel somewhat reluctant to open accounts with American citizens, according to an article by Kenneth H. Ryesky posted on September 4th on the American Thinker website. Ryesky is an attorney who formerly worked for the IRS and who now is a senior advisor with the U.S. desk at Ernst & Young in Tel Aviv.

He writes that thousands of Israelis who never had any intention of coming under the regulations of the United States have suddenly found themselves affected by these laws, to their detriment. It has come as an unpleasant shock and has caused major disruptions to their lives in some cases.

Due to aliyah and the subsequent descendants through the generations, numerous Israelis hold dual U.S. citizenship, thus becoming “accidental Americans.” (The same holds true in the United States with Israeli citizenship as well, of course.) Those who have tried to renounce their citizenship have also found that process is not as simple as it seems, because they are faced with an “expatriation tax” — a case of “damned if you do, damned if you don’t.”

Ryesky writes that Israel is now giving “serious consideration” to the interest of those and other dual citizens: the Supreme Court has enjoined the state to cease and desist in its planned transfer of FATCA information to the IRS pending a September 12, 2016 hearing.

The action was brought before the Supreme Court by “Republicans Overseas Israel.” On August 8, the PAC  filed an amended petition with the High Court of Justice against the new FATCA law adopted by the Knesset on July 12, according to a statement by ROI.

In accordance with the law, the Israeli Tax Authority would have begun the transfer of all personal and private financial information of U.S. citizens and residents to the IRS, but the Supreme Court issued an interim order preventing the state from transferring the information, which would have begun on September 1.

The September 12 hearing is intended to determine the next step.

Hana Levi Julian

Knesset Committee Approves Submission to US IRS Tax Compliance Act

Tuesday, July 12th, 2016

After weeks of debates, on Monday the Knesset Finance Committee approved a bill to apply the Foreign Account Tax Compliance Act (FATCA), which the US has already signed with 113 countries. The 2010 federal law enforces the requirement for US citizens living abroad to file yearly reports on their non-US financial accounts to the Financial Crimes Enforcement Network (FINCEN). The law also requires all foreign financial institutions (FFIs) to search their records and to report the assets of US citizens living abroad to the US Department of the Treasury.

Finance Committee Chairman MK Moshe Gafni (United Torah Judaism) was able, after lengthy negotiations with the Israeli Finance Ministry, to increase the protection of Israeli citizens whose information will be handed over to the US, and reduce in half (from about $27 thousand to about $13 thousand) the sanctions against financial institutions that fail to comply with new law for technical reasons. Gafni also managed to change the definition of charity organizations in the Haredi community (Gmachim), changing their definition from “financial institutions” to “organizations that benefit the public,” thus removing them from the FATCA zone.

The committee also succeeded in repelling the Israeli tax authority, which wanted initially to be able to use information gathered by Israeli banks for FATCA to their own local tax collection ends. As Gafni put it, “This is a bad law, and to come now and use it for other purposes that have nothing to do with its essence would be unthinkable.”

The issue of forcing foreign financial institutions and foreign governments to collect data on US citizens at their own expense and transmit it to the IRS has been attacked outside Israel as well. Former Canadian Finance Minister Jim Flaherty objected to the law’s “far-reaching and extraterritorial implications” which require Canadian banks to become extensions of the IRS and could jeopardize Canadians’ privacy rights.

There have also been reports of many foreign banks refusing to open accounts for Americans, making it harder for Americans to live and work abroad.

JNi.Media

Enough With the Gratuitous Israel-Bashing – Some Profs are Fighting Back

Wednesday, April 20th, 2016

Imagine this:  an organization called the American Studies Association, which was chartered by the Congress of the United States of America, and which is based in Washington, D.C., and which is composed of American scholars at American universities teaching American students about America, decided in 2013, that it should declare that it would – and all other U.S. academic institutions should – cease to deal with any Israeli academic institutions.

Got that?  Don’t you think a boycott of Israeli academics is what professors of American history, American culture, American literature should have as their organization’s mission? No?

If not, it turns out that four distinguished members of the ASA agree with you. And so does the organisation’s actual mission statement. That’s why those four members announced today that they are suing the ASA, charging that the blatant politicization of their academic association violates District of Columbia (D.C.) law governing nonprofit organizations.

“Until a handful of zealots hijacked our learned society, the ASA was the leading organization for the study of American culture,” stated Professor Simon Bronner, one of the plaintiffs. “Yet in 2013, in marched a handful of anti-Israel Boycott, Divestment and Sanctions (BDS) activists and suddenly ASA is an organization of social change pushing a narrow political agenda.”

According to the plaintiffs – all four of whom are professors who teach American Studies – the boycott adopted by ASA in December 2013 was a concerted effort by a small number of BDS activists, including founding members of the U.S. Campaign for the Academic and Cultural Boycott of Israel (USACBI), who used their leadership positions in ASA to make anti-Israel activism the central focus of the Association.

ASA’s stated mission – obviously and literally – has nothing to do with boycotting a foreign nation and thus the suit alleges its adoption violates the law that governs nonprofit corporations. These laws prevent organizations from engaging in activity that ignores its raison d’être, according to its own incorporating documents. An example: an organization created expressly as a charity to benefit the disabled cannot, because of these laws, take its donors’ money and decide it wants to instead promote fracking or protest animal cruelty.

The Complaint was brought against the people who are, or recently were, officers of the ASA, and who have used their positions to redirect the erstwhile scholarly organization.

In the allegations filed Wednesday, April 20, the plaintiffs explain:  “The Individual Defendants’ goals have nothing to do with the promotion of scholarship and everything to do with the advancement of their own political views, and their goal in hijacking the ASA is to use it to advance those views, not to advance the study of American culture.“

When the boycott was initiated, ASA’s constitution stated that “[t]he object of the association [is] the promotion of the study of American culture through the encouragement of research, teaching, publication…about American culture in all its diversity and complexity.”

The lawsuit charges that a boycott of another country is outside the scope of ASA’s charter and is the antithesis of promoting knowledge. ASA’s constitution goes on to say that ASA’s goal is “the strengthening of relations among persons and institutions in this country and abroad devoted to such studies.” According to the Complaint, the boycott does the exact opposite:  it affirmatively excludes an entire country and its academics.

In addition, as a tax-exempt nonprofit, ASA reports annually to the Internal Revenue Service. In its IRS documents, the Association continues to describe its mission as “the nation’s oldest and largest association devoted to the interdisciplinary study of American culture and history,” with its “exempt purpose – advancing the Study of American Culture.”  Plaintiffs allege that the academic boycott of Israel is clearly outside of this stated mission and purpose. Sounds right, doesn’t it?

Lori Lowenthal Marcus

First Step Taken to Impeach IRS Commissioner John Koskinen

Wednesday, October 28th, 2015

Republicans in the U.S. House of Representatives moved on a pledge first made during the summer and introduced a resolution to impeach Internal Revenue Services Commissioner John Koskinen.

The resolution accused Koskinen of making false statements under oath and with failing to properly respond to congressionally-issued subpoenas for evidence. Koskinen did not become commissioner until late in 2013, and he was not charged with any wrongdoing prior to that date, but with actions taken once he assumed his position.

The charges both have to do with how Koskinen responded to congressional inquiries and requests for emails belonging to Lois Lerner.

Lerner was the head of the exempt organizations division of the IRS during the time the service was charged with having targeted conservative and pro-Israel organizations in their applications for tax-exempt status.

A subpoena was issued to the IRS on Aug. 2, 2013, seeking all of Lerner’s communications during the relevant time period. On Feb. 14 that subpoena was reissued to Koskinen, after he was confirmed as IRS Commissioner.

On March 4, 2014, an IRS employee destroyed as many as 24,000 of Lerner’s emails. The destruction of those emails took place after the congressional subpoena was issued for Lerner’s emails.

On March 26, Koskinen swore that all of Lois Lerner’s emails would be produced to the committee. Koskinen also testified to the investigating committee on June 20, 2014, that “since the start of this investigation every email has been preserved. Nothing has been lost. Nothing has been destroyed.”

The resolution charges Koskinen with high crimes and misdemeanors for failing to preserve IRS records in accordance with the subpoena and for making false and misleading statements to Congress. He also was charged with withholding the information about the destruction of Lerner’s emails and for general incompetence for failing to uncover emails that were recoverable and for overseeing a lackluster investigation.

The impeachment resolution was introduced by House Investigative Committee chair Rep. Jason Chaffetz (R-UT) and co-sponsored by 18 other committee members.

Lori Lowenthal Marcus

Printed from: http://www.jewishpress.com/news/breaking-news/first-step-taken-to-impeach-irs-commissioner-john-koskinen/2015/10/28/

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