Tags: IRS Scandal | John Koskinen | IRS | redefined | political

Commissioner Koskinen: IRS Works on New Rule for Nonprofits

Image: Commissioner Koskinen: IRS Works on New Rule for Nonprofits

By Cathy Burke   |   Monday, 14 Apr 2014 06:50 PM

The IRS is working on a "redefined rule" for regulating political activities of nonprofits, prompted by the scandal over the agency's targeting of tea party groups, IRS Commissioner John Koskinen said Monday.

"People need to have confidence in the integrity of the IRS, that it is not a political organization, that we're not marching to anyone else's drummer," Koskinen told USA Today's "Capital Download."

"In all likelihood we will repropose a redefined rule and ask for more public comment," he said.

The process could take "until the end of the year and beyond" to complete, he said, noting that the proposed regulation of 501(c)(4) groups drew a record 150,000 comments by a February deadline.

Regulation of those groups has been slammed as too restrictive on their educational and registration programs -- drawing criticism from both the right and left, the newspaper noted.

"There are very thoughtful comments and concerns, and one of the questions that has evoked a lot of comment is, once you define what political activity is, to what organizations should it apply in the 501(c) context, and how much of it should be allowed?" Koskinen said. "People should view it as something that's fair to everybody."

Last May, the agency came under fire after revelations that tea party and conservative groups applying for such status were getting extra scrutiny.

No fewer than six investigations are now under way on Capitol Hill, noted Koskinen, a government turnaround specialist confirmed by the Senate in December to take over the embattled IRS.

"What we're hoping for that is that one of the six investigating bodies will issue their reports," he said.

"We'll take a look at the findings and any recommendations they have, decide if there's anything beyond what we've already done that we need to do, and then we need to move forward."

He said, however, that it would take years to complete and produce everything subpoenaed by California Republican Rep. Darrell Issa's House Oversight and Government Reform Committee – describing some of the requested documents as "a lot of irrelevant, vast volumes of material."

Things look better for the Senate Finance Committee, he said, noting that Oregon Democratic Sen. Ron Wyden, chairman of the panel, told him a report could be expected "in the relatively near future," maybe as soon as June.

In the interview, Koskinen said that the agency -- getting less money and fewer workers – is "sort of in the middle of a political bull's-eye," and that opposition to Obamacare on Capitol Hill isn't helping.

"Together with the Affordable Care Act, the issue surrounding the qualifications of 501(c)(4) social-welfare organizations has been a battle in public media for the past year," he said. "The combination of the two has made getting more funding difficult."

The IRS is required to assess penalties on most taxpayers who fail to get health insurance, the newspaper noted.

But one aspect of the funding fallout is that the IRS is doing fewer audits, he conceded, warning: "I wouldn't encourage anybody to depend upon us not auditing them. As I've told people, the roulette wheel is spinning."

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