How today's IRS machine works

E-mails Suggest Collusion Between FEC, IRS to Target Conservative Groups 
July 31, 2013

Embattled Internal Revenue Service official Lois Lerner and an attorney in the Federal Election Commission’s general counsel’s office appear to have twice colluded to influence the record before the FEC’s vote in the case of a conservative non-profit organization, according to e-mails unearthed by the House Ways and Means Committee and obtained exclusively by National Review Online. The correspondence suggests the discrimination of conservative groups extended beyond the IRS and into the FEC, where an attorney from the agency’s enforcement division in at least one case sought and received tax information about the status of a conservative group, the American Future Fund, before recommending that the commission prosecute it for violations of campaign-finance law. Lerner, the former head of the IRS’s exempt-organizations division, worked at the FEC from 1986 to 1995, and was known for aggressive investigation of conservative groups during her tenure there, too.

“Several months ago . . . I spoke with you about the American Future Fund, a 501(c)(4) organization that had submitted an exemption application the IRS [sic],” the FEC attorney wrote Lerner in February 2009. The FEC, which polices violations of campaign-finance laws, is not exempted under Rule 6103, which prohibits the IRS from sharing confidential taxpayer information, but the e-mail indicates Lerner may have provided that information nonetheless: “When we spoke last July, you had told us that the American Future Fund had not received an exemption letter from the IRS,” the FEC attorney wrote.

The timing of the correspondence between Lerner and the FEC suggests the FEC attorney sought information from the IRS in order to influence an upcoming vote by the six FEC commissioners. The FEC received a complaint in March 2008 from the Minnesota Democratic Farmer Labor Party alleging that the American Future Fund had violated campaign-finance law by engaging in political advocacy without registering as a political-action committee. The American Future Fund responded to that complaint in June 2008, telling the commission that it had applied for tax exemption in March of that year and was a “501(c)(4) social-welfare organization that was organized to provide Americans with a conservative and free-market viewpoint and mechanism to communicate and advocate on the issues that most interest and concern them.”

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House Ways and Means Committee chairman Dave Camp and oversight-subcommittee chairman Charles Boustany are calling on the IRS, in the wake of these revelations, to provide all communications between the agency and the FEC between 2008 and 2012. “The American public is entitled to know whether the IRS is inappropriately sharing their confidential tax information with other agencies,” Camp and Boustany write in a letter they will send to acting IRS administrator Danny Werfel on Wednesday.