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April 20, 2014 / 20 Nisan, 5774
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Posts Tagged ‘J. Russell George’

Republicans and Democrats Ignore IRS Abuse of Pro-Israel Group

Wednesday, August 7th, 2013

Two Republican chairs of congressional committees which have been investigating for the past several months what some have called IRS-Gate, penned an opinion piece which appeared in the Washington Post on Tuesday, August 6.

Darrell Issa (R-Calif.) and Dave Camp (R-Mich.) are the chairmen of, respectively, the House committees on Oversight and Ways and Means. In their opinion piece, “The IRS Scandals Inconsistencies,” the members of congress criticize the Internal Revenue Service for targeting politically conservative groups for discriminatory treatment.

The Republican congressmen also criticize their colleagues from the Democratic party and this Democratic administration for changing their story repeatedly about what happened, who was responsible, and who then tried to convince the American people that this was “not much of a scandal,” and then they attempted “to smear the inspector general” by “falsely equating routine scrutiny of progressive groups to tea party applications.”

But the Democrats aren’t the only ones who repeatedly refuse to ignore admissible evidence produced by the IRS itself, that the tax agency clearly, unequivocally and blatantly engaged in viewpoint discrimination.

The Republicans have also been ignoring or hiding a group that was wronged, perhaps because that group – unlike the Tea Party organizations – does not have a set of political defenders.   Unlike every other entity involved in this entire scandal and its investigation, this other group is truly apolitical.  The ardently pro-Israel organization Z STREET (of which this reporter is the president) was demonstrably discriminated against by the IRS, yet every member of congress has thus far ignored the group’s plight.

Z STREET brought a lawsuit against the IRS in August, 2010, claiming that the IRS had engaged in viewpoint discrimination, thereby violating the group’s First Amendment right to free speech.  The basis for the lawsuit were the statements made by the IRS agent in charge of Z STREET’s application to Z STREET’s tax lawyer that one, “the IRS had to give special scrutiny to organizations connected to Israel” and that two, some organizations’ applications had to be “sent to a special unit in Washington, D.C. to determine whether the activities of the organization contradicted the public policies of this Administration.”

While the Justice Department, which represents the IRS in litigation, concocted several defenses to Z STREET’s claims, they ultimately came up with a justification they deemed so bulletproof they offered a set of sworn statements by IRS officials why the IRS applied special scrutiny to Z STREET’s application.  The justification?  It is because Z STREET supports “Israel, which is a country with a higher risk of terrorism,” and therefore Z STREET might be funding terrorists.

The IRS stuck to its guns on this “Israel as a terrorist state” defense.  However, they could not have predicted that the ranking member of the Democrats for Cong. Camp’s own committee – Rep. Sander Levin (D-Mich) of the House Ways and Means Committee – was going to blow its cover.

That happened on June 24, when Cong. Levin released a series of documents produced by the IRS which he thought proved the IRS had targeted groups that were politically liberal (the term on the chart was “progressives”), and therefore the admitted targeting of politically conservative groups could not have been politically motivated.

But, as the Treasury Department’s Inspector General for Tax Administration J. Russell George explained, and as becomes clear by merely reviewing the charts, the “progressives” were listed as an historical issue of concern, and the motivation for the interest was whether or not those organizations should have filed a 501(c)(4) application which is for politically active groups, rather than for a 501(c)(3) application which is for groups engaged in educating the public.

However, those same charts created and produced by the tax agency itself reveal that the IRS created a category called “Occupied Territory Advocacy,” which dealt with groups which discuss the “disputed territories in the Middle East.” This category did show up on the IRS BOLO (Be on the Look Out) tab of the charts, unlike the “progressives” category.

Whatever the heck the IRS is supposed to be doing when it examines applicants for tax exempt status, it should not be looking at the ideological positions the organization takes with respect to the Middle East conflict.  Especially when the organization is engaged solely in educating about the issues, and doesn’t use donors’ funds to give grants to anything, anywhere, for anything.

And, despite the sworn statements by IRS officials, the word “terrorism” is nowhere to be found on any of the charts created by the IRS to show what kinds of organizations received additional scrutiny of their applications for tax exemption.

But somehow that slam dunk example of blatant viewpoint discrimination, delivered with a ribbon and a bow from Cong. Levin, escaped the notice of everyone who claims to be “servants of the people.”

Nope, unless an organization has political juice, it appears neither the Democrats or the Republicans care when the constitutional rights of a group of Americans have been violated by a U.S. government agency.

A pox on both their houses.

IRS in Court Friday, its Documents Prove Z STREET’s Claims

Friday, July 19th, 2013

The more evidence is revealed regarding the Internal Revenue Service’s treatment of organizations whose ideological views conflict with those of this Administration’s, the more it becomes apparent that the claims made against the IRS by a small pro-Israel non-profit back in August, 2010 were not only probably true, but are demonstrably true.  Incredibly, the proof that Z STREET’s claims are true was found in documents created by the IRS itself, in submissions to investigators looking into IRS misbehavior regarding other non-profits.

And on Friday, July 19, as the IRS makes its first court hearing in any case regarding claims that it mistreated many non-profits because of the ideological positions of those organizations, the proof of its ideological motivations are now public.

This Friday, July 19, at 10:00 a.m., Judge Ketanji Brown Jackson will hear the government’s motion to dismiss Z STREET’s claims against it in courtroom 17 in the Federal district court in Washington, D.C.

In a federal lawsuit filed in August, 2010, Z STREET claimed that the IRS had engaged in viewpoint discrimination while processing Z STREET’s application for status as non-profit.  The basis for its claim was that the IRS agent assigned to Z TREET’s file told Z STREET’s corporate counsel that the review of Z STREET’s application for tax exempt status would take a long time because the IRS had to “give special scrutiny to organizations connected to Israel,” and that the files of some of those organizations “were sent to a special unit in Washington, D.C. to determine whether the organization’s activity’s contradict the public policy of the Administration.”

This Wednesday, July 17, Z STREET (this reporter is the president of the organization) filed a supplemental memorandum with the court, submitting newly-discovered evidence that the IRS employees created a purely political category “Occupied Territory Advocacy” as the basis for additional review of an organization’s application for tax exempt status.

All of the information about this IRS categorization is contained in documents which the IRS had been required to submit during an investigation conducted by the Treasury Department’s Inspector General for Tax Affairs.  But these documents had not been made public earlier, because the IG’s mandate had been to look at organization’s whose applications were delayed on the basis of political orientation, the largest example being the Tea Party organizations.

However, on June 24, Rep. Sander Levin, (D-MICH), released a series of documents produced by the Internal Revenue Service.  Rep. Levin said he believed these materials proved the IRS had not only targeted conservative groups, but that it had also gone after “progressive” groups, i.e. liberal ones. Presumably, his goal was to prove that the IRS was not selective in its misbehavior, but had been an equal opportunity offender.  Levin believed that the 14 IRS documents which he released on June 24, 2013, made this point, and he then went on the offensive, lambasting the Treasury’s Inspector General, J. Russell George, for failing to raise this “fact” in his report.

Sympathetic media outlets immediately ran top-of-the fold headlines proclaiming, based upon statements made in a conference call given by Danny Werfel, the new Acting IRS Commissioner, with select members of the media, that the IRS had not only used the words “Tea Party” as a search term to target organizations for additional scrutiny, but that it had also targeted “progressives,” “Israel” and “Occupy.” Outlets which ran with this story, and used the claim in its headlines, included the Associated Press, Bloomberg News, and the Huffington Post.

But a detailed review of the IRS documents released by Levin, as well as a lengthy response by the Inspector General to Levin’s scathing letter, revealed that those documents did not prove what Levin and others hoped was being proved. In fact they proved something very different.

Although the term “progressives” was found as a category on several of the documents, just a few minutes’ perusal of that line item reveals that nothing was done with the organizations with that term in their title.  In fact, the Tab under which that term appears is “Potential Abusive Historical,” and the category had been moribund.  A note in one of the columns revealed that because those organizations were clearly engaged in political activity, IRS employees noted that they should have requested a 501(c)(4) and not the 501(c)(3) designation they sought.

IRS Chief Under the Congressional Spotlight on Friday

Tuesday, May 14th, 2013

A concerted effort by a mid-level Internal Revenue Service official last Friday, May 10, to confess to some minor irregularities in how the IRS has dealt with conservative organizations seeking tax exempt status has unraveled.  Lois Lerner, who oversees tax exempt organizations for the IRS, attempted to get out the word under the radar.  She failed miserably.

Lerner attempted to present the issue as having affected a small number of organizations, targeted by using a few key words, and acted out by only a few low level IRS employees in a remote office, for a limited period of time, which took place without the consent or even knowledge of higher level IRS officials.  By Monday morning that cover had been entirely blown.

In the center of a scandal that continues to grow wider, deeper and longer by the day, the Acting Internal Revenue Service Commissioner will be sitting in the hot seat before the House Ways and Means Committee this Friday morning, May 17, starting at 9:00 a.m.

The hearing is to discuss the practice of targeting applicants for tax-exempt status based on political leanings.  There will only be two people called to testify at this hearing: Acting Commissioner of the Internal Revenue Service, Steve Miller, and the Treasury Inspector General for Tax Administration, J. Russell George.  Miller was the assistant to the former IRS commissioner, Douglas Shulman, under whose watch many of the complaining organizations experienced allegedly excessive and inappropriate probing by the IRS.

The first admission, last Friday afternoon, was that the IRS had been subjecting certain conservative groups to increased scrutiny but insisting that only “low level IRS employees” in a remote Ohio office were using inappropriate ways in which to flag certain groups, and that the practice was short-lived.  The excuse was that in 2012 there were so many new groups seeking tax exempt status that the Agency had to figure out ways in which to more quickly help determine which groups were legitimate and which weren’t.

But as revelations continue to leak out of Washington, D.C., it appears the practice was much broader, it took place in multiple IRS offices in cities across the country, it went on for a much longer period of time than was originally admitted, and high level IRS officials were aware of some aspects of the progress for far longer than had earlier been admitted.

In addition to inappropriate questioning by IRS agents in Cincinnati, Ohio, the original site mentioned by Lerner, documents have revealed that agents in Washington, D.C. and at least one other IRS office were involved in providing increased levels of scrutiny to certain conservative organizations.

And it wasn’t only groups with the words “tea party” and “patriot” in their organization’s names that were pulled out of line for additional scrutiny.  The IRS net included groups that opposed Obamacare, those that focused on vote fraud, ones that sought to educate about the Constitution and the Bill of Rights, and ones that sought to limit the role of government.

Although Lerner claimed only low-level agents in the Cincinnati office engaged in and knew about the practice, it is now known that IRS employees in Washington were aware of the practice. The Inspector General’s report states that officials at the Internal Revenue Service knew in June 2011 that their agents were targeting conservative groups for additional scrutiny on tax documents, CNN reported Monday.

The original revelation of IRS inappropriate activity suggested that the practice only began in 2012, but the Inspector General’s report revealed that the practice began as far back as 2010.

IRC 501(c)(3) versus 501 (c)(4)

Thus far it appears that almost all of the groups complaining about the inappropriate, politically-oriented targeting are organizations seeking tax exempt status as “social welfare” organizations, which come under the Internal Revenue Code section 501(c)(4).  These groups, as distinct from 501(c)(3) organizations, are given more leeway in terms of engaging in political activity. There was a huge increase in the number of such organizations following a 2010 Supreme Court decision which gave a hecksher to political campaign spending by corporations, in Citizens United v. Federal Election Commission.

Both (c)(3) organizations and (c)(4) organizations are exempt from paying taxes, but only donations made to (c)(3) organizations are tax deductible.  Organizations that are (c)(3)s can engage in only very limited lobbying activity and cannot engage in political activity at all, whereas (c)(4)s can engage in unlimited lobbying and can engage in political activity to the extent it is consistent with the organization’s mission and so long as it is not the organization’s primary activity.

The pro-Israel and Jewish organizations that have complained about inappropriate IRS activity by the IRS are 501(c)(3)s.

It may be that the next wave of congressional inquiry will focus on what other kinds of organizations have been targeted for special scrutiny by the IRS.

In addition to Friday’s House Ways and Means Committee hearing, the IRS can look forward to hearings before at least one more, if not two more, congressional committees.

On Monday, Senate Finance Committee Chairman Max Baucus (D-MONTANA) called for a full investigation into the IRS targeting of conservative groups. Senator John McCain (R-AZ) also announced on Monday that the Senate Permanent Subcommittee on Investigations plans to investigate the new IRS revelations.

President Barack Obama issued a statement on Monday calling the alleged misdoing by the IRS “outrageous, if true.”  White House spokesperson Jay Carney said that Obama only found out about the matter last Friday.

Printed from: http://www.jewishpress.com/news/irs-chief-under-the-congressional-spotlight-on-friday/2013/05/14/

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