[EL] Wall Street Journal IRS Atmosphere Timeline

[BZall at aol.com]

No one seems to be reacting to the Wall Street Journal column  attempting 
to use a timeline to explain how "low-level" IRS agents might find it  
necessary to scrutinize 1024s from some groups more than others, asking  otherwise 
inappropriate questions about volunteers and individuals. 
 
http://online.wsj.com/article/SB10001424127887323844804578529571309012846.ht
ml?mod=opinion_newsreel
 
This echoes a debate at last week's First Tuesday Lunch meeting where one  
set of public policy attorneys (my own term for lawyers who specialize in 
both  campaign finance and exempt organization law) discussed with another  
set whether there was direction, either explicit or tacit, from the  
Administration. One set remembers Austan Goolsbee very well; others not so  much, and 
the discrepancy taints the analysis of current events. 
 
We have long known that the IRS reads the newspapers, as you would expect  
them to. The question is whether they consciously or unconsciously absorb 
some  of the campaign rhetoric, and if they do, whether it is absorbed evenly 
or  not. In an area where confirmation bias runs rampant, as evidenced by 
recent  posts to this list, are we training IRS agents to avoid it? Even 
lawyers who  read some IRS publications have no clue about how the political 
rules actually  work. In many cases, it takes years to understand, just as you 
expect in any  other complex area. There's no real evidence of that type of 
training in the  IRS, and the TIGTA report indicates that training sessions 
were either late or  incomplete. Was Judy Kindell, the resident guru on 
political matters in the IRS  EO Division, consulted in 2009, when this whole 
mess began? Apparently the  isolation of Cincinnati imposed by the 2003 IRS 
reorganization bore its bitter  fruit, fertilized by a continual lack of 
resources, in that time period.
 
Perhaps the point is one also made at last week's lunch: the real  problem 
here is that IRS Determs was using audit techniques instead of  reviewing 
applications. That may have been because the agents were fearful  that some of 
what was being said in the media (as opposed to the applications)  was 
true, and sought to get to the bottom of it. That is not necessarily a bad  
thing if you are tasked with determining how organizations will operate in the  
future (itself an incredibly difficult task), particularly with charities. 
But  these were c4s, where political activity is perfectly lawful. Audit 
techniques  are likely inappropriate when an organization does not have a track 
record, and  will only result in shutting down the smaller and newer 
organizations who can't  afford the skilled counsel who can simply stare down the 
inappropriate questions  or call the managers they already know to complain. 
It is all well-and-good to  question the competence of low-level employees 
who made mistakes, but we should  look at the system to see the real 
structural issues. 
 
Barnaby Zall 
Of Counsel 
Weinberg, Jacobs & Tolani, LLP  
10411 Motor City Drive, Suite 500
Bethesda, MD 20817
301-231-6943  (direct dial) 
bzall at aol.com  
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