GOP: IRS Sought to Limit Impact of 'Citizens United' Ruling

Wednesday, 05 Mar 2014 01:12 PM

By Melanie Batley

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House Republicans investigating the IRS targeting scandal are zeroing in on a theory that top agency officials, led by Lois Lerner, were motivated by a desire to limit the impact of the Supreme Court's "Citizens United" ruling, because of concerns that it would give Republican donors more influence over the political process.

According to emails contained in a draft of a new House Oversight and Government Reform Committee report by Republicans, obtained by Politico, Lerner and her colleagues appeared concerned that the controversial 2010 ruling, which eliminated caps on corporate political donations, would influence the political activities of nonprofits.

Lerner's attorney, William Taylor II, called the Republican theory "pure fiction," Politico reported.

Wednesday capped off a dramatic day of hearings after Lerner for a second time refused to testify, asserting her Fifth Amendment right against self-incrimination.

Oversight Chairman Darrell Issa ended the hearing during an outburst by the panel's top Democrat, Rep. Elijah Cummings, who insisted he had further questions and that the investigation was being rigged for partisan purposes. 

The emails in the report appear to confirm that Lerner and top agency officials were focused on preventing the possible abuse of tax-exempt status in the wake of the "Citizens United" ruling.

"My object is not to look for political activity — more to see whether self-declared c4s are really acting like c4s. Then we'll move on to c5, c6, c7 — it will fill up the work plan forever!" Lerner wrote in an email to colleagues in 2010, according to Politico.

The email dates several months after Cincinnati-based IRS employees began targeting conservative groups for heightened scrutiny.

No specific reference is made to particular political parties, Politico said, but the report shows that as early as September 2010, Lerner forwarded colleagues an EO Tax Journal blog advising the IRS to "keep track of new c4s" and "be more pro-active" about tracking groups created solely for political activities.

The article specifically mentioned a concern about "educational organizations woven by the fabulously rich Koch Brothers to foster their own financial interest by political means."

The report highlights another email by Lerner that appears to indicate a concern about the possible publicity risks associated with focusing on 501(c)4 groups. She wrote to colleagues, "We need to have a plan. We need to be cautious so it isn't a per se political project. More a c4 project that will look at levels of lobbying and pol. activity along with exempt activity."

Republicans suggest the email is further evidence of her attempt to cover up the agency's political targeting.

The report also mentions how in June 2012, a liaison for the tax-exempt division sent an email to Lerner with an article titled "How Dark Money Groups Sneak by the Taxman," which specifically mentioned conservative groups such as American Action Network, Crossroads GPS, Americans for Prosperity, Freedom Works, and Citizens United.

Lerner forwarded the article to the director of exempt-organization examinations, Nanette Downing, mentioning a particular group in the forward (which had been redacted in the report).

Democratic Oversight staff, however, insist there is no evidence in the report to substantiate the conclusions made by Republicans that Lerner was specifically attempting to thwart conservative groups out of concerns over the "Citizens United" ruling, Politico reports.

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