“During the Bush administration, liberal groups were targeted” by the IRS, similar to recent targeting. -- U.S. Rep. Jim McDermott, D-Wash., during a House Ways and Means Committee hearing June 4
At a House Ways and Means Committee hearing June 4, U.S. Rep. Jim McDermott, D-Wash., listened closely to the stories from members of groups that were snagged when the Internal Revenue Service cast a wide net for politically active organizations seeking tax-exempt status. All the groups advocate for conservative causes.
While McDermott said he was sorry they had been singled out, and that “the IRS has unequivocally made a mistake here,” he was more focused on the lack of clear legal rules that should guide the IRS.
“Let’s not get lost,” McDermott said. “During the Bush administration liberal groups were targeted without any concern by Mr. Issa or anyone else in this committee.” (Rep. Darrell Issa, R-Calif., is chairman of the House Oversight and Government Reform Committee.)
This caught our eye. Were liberal groups targeted when a Republican held the White House? And if so, were the circumstances back then similar to what has come to light today?
We asked McDermott’s office for details, and staff pointed us to a recent Salon article that described how the IRS subjected the NAACP, Greenpeace and a liberal Episcopal church in California to sometimes intense scrutiny. In 2004, the IRS audited the NAACP after its chairman said President George W. Bush was the first sitting president since Herbert Hoover who declined to speak before the group. The same year, the IRS moved to revoke the tax-exempt status of All Saints Episcopal in Pasadena. The Sunday before the 2004 election, the rector told the congregation “Jesus (would say), ‘Mr. President, your doctrine of pre-emptive war is a failed doctrine.’ “ That case dragged on for three years before the IRS dropped it.
From 2004 to 2009, the IRS had a Political Activities Compliance Initiative aimed at 501(c)(3) groups that might have endorsed a candidate or otherwise crossed the line between charitable work and electioneering. In 2004, the IRS opened cases on 110 groups. A 2005 audit by the Treasury Inspector General for Tax Administration found, though, that there was no political bias.
The current controversy involves the examination of nearly 300 groups, and there are significant differences today from the examples cited in the Salon article:
- The inspector general found that IRS staff used "inappropriate criteria" to identify groups for special attention. A group's name or a focus on government debt and spending triggered IRS action, rather than the group's activities.
- Most of the groups, about 70 percent, held or were applying for 501(c)(4) status, not 501(c)(3). The limits on (c)(3) groups — the ones examined under Bush — are much more strict than for (c)(4) groups.
- The inspector general found that all cases with "tea party," "patriots" or "9/12" in their name were singled out.
All the experts we contacted said the rules concerning what 501(c)(4) groups are vague and leave the door open to excesses by the IRS.
McDermott’s office said his point was that while the recent IRS actions were unacceptable, they don’t represent a political conspiracy or a unique occurrence.
Nevertheless, McDermott’s comparison falls short on a number of fronts.
David Keating, president of the conservative-leaning Center for Competitive Politics sees nothing similar between what happened under Bush and what happened under Obama.
The key difference, Keating said, is the global impact of the IRS screening. “What the IRS did with the tea party groups is they set them aside and every single one got special scrutiny because of the philosophy of the organization,” he said.
In contrast, Keating said, there is no evidence that the IRS under Bush targeted all environmental groups or all progressive churches.
On the other hand, Gabe Rottman, the legislative counsel at the American Civil Liberties Union, said we should withhold full judgment on the IRS actions during the 18 months between 2010 and 2012.
“We don’t know if it was a good-faith mistake or if it was an effort by people at the IRS to target these groups because of their political beliefs,” Rottman said. “What happened under Bush, the mechanics might be different, but the existence of a situation that allows selective enforcement is a problem across both administrations.”
Our ruling
McDermott said liberal groups were targeted during the Bush administration. While some liberal groups were audited, the numbers we could find were small, largely confined to 501(c)(3) nonprofits where the rules are more strict, and stemmed from complaints levied by outsiders.
In contrast, the current case was fueled by internal bureaucratic rules applied to a significantly larger number of organizations. A group’s name or its policy agenda triggered the IRS action, rather than a complaint or the group’s specific activities. While there is an element of truth in McDermott’s statement, the systematic nature of the IRS actions between 2010 and 2012 represents a distinctly different set of circumstances.
We rate the statement Mostly False.
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