US tax agency halts political screening criteria

The politically beleaguered US tax agency has said it had suspended screening criteria that led to the targeting of conservative groups seeking tax-exempt status.
Acting Internal Revenue Service Commissioner Danny Werfel yesterday issued a report outlining new measures the agency will undertake to fix problems uncovered last month by a US Treasury watchdog.
Among the measures is the suspension of any "be-on-the-lookout" or BOLO lists to screen applicants for non-profit status, which allows groups to avoid paying taxes on donations and in some cases to raise funds anonymously.
According to an explosive US Treasury Inspector General report released in mid-May, the IRS singled out certain conservative groups in assessing their requests for tax-exempt status, prolonging the application process.

"It is critical that the IRS takes steps to ensure accountability, address the problems uncovered in recent weeks and improve the operations of the IRS to continue to carry out our critical mission," Werfel said in a statement.
"We have made a number of changes already, more are in the works and even more will develop as we move forward."

The initial IRS review found "no signs of intentional wrongdoing by IRS personnel or involvement by parties outside the IRS" in the activities described in the Treasury report.
But the IRS report noted that the investigations were ongoing.
"The IRS is committed to correcting its mistakes, holding people accountable, and establishing control elements that will help us mitigate the risks we face," Werfel said.

"This report is a critical first step in the process of restoring trust in this critical institution."
The White House said that President Barack Obama, who last month condemned the IRS conduct as unacceptable, was briefed earlier in the day by Werfel on the report.
"The President appreciates the effort put into reviewing operations within the IRS, and most importantly, making sure that agency moves quickly to restore the public's trust," it said in a statement.
Werfel was appointed to run the agency after Obama forced the previous head to resign after the revelations of the wrongdoing that occurred between 2010 and 2012.

Treasury Secretary Jacob Lew, who attended the White House briefing, said Werfel and his leadership team had made progress in improving IRS operations, including putting in new management for tax-exempt applications.
"The assessments and actions outlined in Mr. Werfel's report have charted a path that will improve performance and accountability.