IRS shakeup needed after scandal, chairmen of Congress' tax-writing panels say

The Internal Revenue Service may need to be restructured after the agency was found improperly targeting conservative groups seeking non-profit status, the chairmen of the two congressional tax-writing committees say.

“There does need to be significant restructuring in the IRS,” said Senate Finance Committee Chairman Max Baucus (D) of Montana. “Within the agency itself, there has got to be some major accountability changes and make sure people are held accountable and not just left to go in their own direction,” Senator Baucus said Friday at a Monitor-hosted breakfast for reporters.

Speaking at the same gathering, the chairman of the House Ways and Means Committee, Rep. Dave Camp (R) of Michigan, said “I think there may be” a need for a total revamping of the IRS. “This looks like, at best, complete management failure, and at worst, intentional. We don’t know that yet. ... We really need to know all the facts.”

The chairmen appeared at the event to discuss their joint, bipartisan efforts at reforming the tax code.

Both Baucus and Representative Camp stressed that their joint investigation of the IRS was continuing. The tax committees have a special level of access to IRS data, and Camp said “we are beginning to use it.” He described the investigation as “more of a white collar approach where you really have to get the documents and prove things. And that takes a long time, it is painstaking.”

A report by the IRS Inspector General released in May revealed that during the 2010 and 2012 elections an IRS office in Cincinnati had singled out for extended questioning and delays applications for tax exempt status from conservative groups that had political sounding names.

Camp said the tax panels hoped to get IRS documents “by the end of this week” that would give a clearer picture of what happened. “But at least in the initial hearings we have had, clearly the management was either intentionally not looking or I would say so out of touch almost rising to the level of wrongdoing.”

Baucus said he had been briefed Thursday on joint interviews the Finance and Ways and Means Committee staffs are holding with IRS employees. “I got a report yesterday from my staff basically concluding that hey, there are real problems here.”

Baucus, who has served on the Senate Finance Committee longer than any other person in history, noted that “it is tough to manage” all of the IRS’s 90,000 employees scattered around the nation. But he added the IRS “is not managed well.”

One of most influential members of the House Republican leadership, Camp said, “The IRS is part of the administration and we had been trying for two years to address this issue.” He said “the evidence so far” is that donors’ were targeted on gift tax issues "because of their conservative beliefs." He also said that “Conservative groups have had confidential IRS tax information leaked” and that “hundreds of groups” were targeted.

Camp said, “I am pretty angry about this and I am not going to stop until I find out what the truth is.”