WASHINGTON -- The Treasury inspector general's office said Thursday that while the Internal Revenue Service screened both progressive and conservative groups between 2010 and 2012, the latter faced more scrutiny.
In a letter to Rep. Sandy Levin (D-Mich.), Russell George, the Treasury Inspector General for Tax Administration (TIGTA), defended his initial audit from accusations that it did not provide a full picture of IRS screening practices for tax-exempt organizations.
The reason his team did not mention progressive organizations, George explained, was that they had been subjected to a different level of scrutiny. Whereas conservative groups were flagged as "potential political cases" on so-called Be On The Lookout (BOLO) lists, no instructions were given to IRS agents about how to handle their progressive counterparts.
George did acknowledge in the letter that the initial TIGTA report did not disclose what is likely a relevant detail: progressive groups were flagged as "potential political cases" in some instances. In one telling line, he noted that some groups were flagged as such despite not even appearing on BOLO lists. But he also continued to make the case that tea party groups faced significantly different treatment when seeking 501(c)(4) tax-exempt status.
"Based on the information you flagged regarding the existence of a 'Progressives' entry on BOLO lists, TIGTA performed additional research which determined that six tax-exempt applications filed between May 2010 and May 2012 having the words 'progress' or 'progressive' in their names were included in the 298 cases the IRS identified as potential political cases," George wrote in his letter to Levin, the ranking member on the House Ways and Means Committee, who had asked why the initial audit didn't mention the screening of progressive groups.
"We also determined that 14 tax-exempt applications filed between May 2010 and May 2012 using the words 'progress' or 'progressive' in their names were not referred for added scrutiny as potential political cases," George continued. "In total, 30 percent of the organizations we identified with the words 'progress' or 'progressive' in their names were processed as potential political cases. In comparison, our audit found that 100 percent of the tax-exempt applications with Tea Party, Patriots, or 9/12 in their names were processed as potential political cases during the timeframe of our audit."
Republicans were quick to highlight George's letter as evidence that the IRS had indeed inappropriately and disproportionately targeted tea party organizations applying for 501(c)(4) status. Democrats, meanwhile, argued that the fact George failed to either discover or disclose that progressive groups were among the 298 that had received extra scrutiny meant his report was fundamentally flawed.
At issue is the significance of the different sections of the BOLO lists. According to the lists released by House Democrats this past week, Tea Party groups were placed in the category "Emerging Issues" while progressive groups fell under the heading "Touch and Go Historical." This seems to be a reflection of the fact that the BOLO lists were created in 2010, when the tea party was emerging on the political scene. George said the different placement meant different treatment by IRS screeners.
"From our audit work, we did not find evidence that the criteria you identified, labeled 'Progressives,' were used by the IRS to select potential political cases during the 2010 to 2012 timeframe we audited," he wrote. "The 'Progressives' criteria appeared on a section of the 'Be On the Look Out' (BOLO) spreadsheet labeled 'Historical,' and, unlike other BOLO entries, did not include instructions on how to refer cases that met the criteria."
While IRS agents received no specific instructions for screening progressive groups, they were told to place tea party groups on a special track -- known as "Group 7822" -- and to coordinate their oversight with the Exempt Organizations Technical unit.
That said, progressive groups weren't given a free pass to tax-exempt status. IRS agents were explicitly told to watch out for "political activities" from progressive organizations, according to the BOLO documents, which warned that the groups "appear to lean toward a new political party ... are partisan and appear as anti-Republican."
And in George's own letter, he acknowledges that progressive groups were still screened, albeit under a categorization that his office did not investigate.
"TIGTA did not audit how the criteria for the 'Progressives' identifier were developed in the BOLO listings," he wrote. "We did not audit these criteria because it appeared in a separate section of the BOLO listings labeled as 'Historical' (as described above) and we did not have indications or other evidence that it was in use for selecting potential political cases from May 2010 to May 2012."
The letter also shed light on what his office was tasked with doing when the House Oversight Committee asked it to investigate the IRS scandal. He said that his investigators were not limited to just examining tea party cases, as a spokesman stated on Tuesday, but instead were asked to review "all cases that the IRS identified as potential political cases." The Huffington Post asked TIGTA for a copy of the instructions it received from the Oversight Committee. A spokesperson referred the question to the committee, which did not return a request for comment.
George's letter to Levin comes on the same morning that House Democrats on the Ways and Means Committee called on him to provide additional congressional testimony. In prior hearings, George was asked whether progressive groups were also screened by the IRS. He declined to give a definitive answer, saying only that other groups received scrutiny.