IRS Oversight Board Admits Inappropriate Targeting and Breakdown of the Processing System


Treasury has not one, but at least two departments tasked with keeping an eye on the IRS. We’ve heard from Treasury’s Inspector General already in his report released this week. Now, the IRS Oversight Board has chimed in. The Oversight Board is a nine-member independent body charged to oversee the IRS in its administration, management, conduct, direction, and supervision of the execution and application of the internal revenue laws. The Secretary of Treasury and the Commissioner of Internal Revenue are members of the Board.

Today the IRS Oversight Board released this statement:

The IRS Oversight Board is deeply troubled by IRS conduct described in the May 14 Treasury Inspector General for Tax Administration (TIGTA) report1. This behavior by a few individuals does a great disservice to the vast majority of IRS employees who discharge their duties within the letter and spirit of the law.

The use of inappropriate criteria to identify organizations applying for tax-exempt status indicates, in the Board’s opinion, a breakdown in the business processing system of the IRS. This breakdown erodes taxpayers’ faith in the integrity and fairness of that system and our public institutions at large. Moreover, during the reported timeline, IRS leadership never informed the Board of the change in its new criteria, although there were regular opportunities to properly brief the Board on this matter.

The Board relies heavily on TIGTA, the Government Accountability Office (GAO), and the National Taxpayer Advocate (NTA) for their nonpartisan investigations and reports, and this TIGTA audit is no exception. Going forward, the Board intends to work closely with the IRS, TIGTA, GAO, NTA, and the appropriate congressional committees to resolve this issue, and shall meet its statutory responsibility to “ensure the proper treatment of taxpayers by the employees of the Internal Revenue Service.”

Created by the IRS Restructuring and Reform Act of 1998, the Oversight Board is an independent body within the Department of the Treasury. The Board’s responsibilities include overseeing the IRS, its administration, management, conduct, direction, and supervision of the execution of the internal revenue laws.

The Board believes that yesterday’s events present a challenge for which the IRS Oversight Board was created, namely to provide continuity in the IRS’ operations regardless of change. The Board will work with the IRS, the Treasury Department and Congress to ensure a seamless transition of leadership and to maintain the integrity of our tax system and taxpayers’ faith in it.

Hat Tip Darin

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