Acting chief of IRS forced out over Tea Party targeting

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WASHINGTON -- Moving to quell a growing scandal, President Barack Obama on Wednesday fired the acting chief of the Internal Revenue Service and vowed to work closely with Congress in determining who ordered lower-level employees to target Tea Party groups and other conservative organizations.

"It's inexcusable, and Americans are right to be angry about it," Mr. Obama said at the White House after meeting with top Treasury Department officials. "And I'm angry about it."

He said Treasury Secretary Jacob Lew asked for and accepted the resignation of acting IRS commissioner Steven Miller, the first high-level casualty of the scandal that has erupted since a Treasury Department's inspector general confirmed what he called the inappropriate scrutiny of conservative groups applying for tax-exempt status.

In an internal memo to IRS employees, Mr. Miller said his assignment as acting chief would end in June, suggesting that he may still appear at hearings scheduled Friday by the House Ways and Means Committee and Tuesday by the Senate Finance Committee.

"This has been an incredibly difficult time for the IRS given the events of the past few days, and there is a strong and immediate need to restore public trust in the nation's tax agency," Mr. Miller wrote to his colleagues. "I believe the service will benefit from having a new acting commissioner in place during this challenging period. As I wrap up my time at the IRS, I will be focused on an orderly transition."

A 25-year veteran of the tax agency, Mr. Miller had headed the IRS as acting director since November. Most of the alleged wrongdoing occurred well before he took over as acting chief, when the agency was run by commissioner Doug Shulman, who was appointed by former President George W. Bush. Mr. Obama did not say who might take the helm of the embattled agency.

Republicans welcomed the president's announcement that Mr. Miller had been fired.

"A great number of questions remain; they demand answers. The resignation of Steven Miller is a positive and important step as this agency struggles to try to regain the public's trust," said Utah Sen. Orrin Hatch, the Senate Finance Committee's top Republican. "A clean slate at the IRS with new leadership is imperative to fix this egregious encroachment on the lives of honest, hard-working Americans whose only sin was that they want to express their beliefs."

Congress will seek more answers about how the scandal occurred, and who knew about it.

The administration has said it first learned of the pending special inspector general's report around April 22, when a Treasury official told the White House counsel's office. But Mr. Obama said he learned about it Friday, when the American public did. The White House has not said why such an important matter was not shared with the president weeks ago, or whether Mr. Lew and others were made aware of it then, but did not tell the president.

Some Republican lawmakers have complained about unfair treatment of Tea Party groups by the IRS for two years, and they suggested that the tax treatment effectively suppressed the vote in 2012 election.

"If the president is as concerned about this issue as he claims, he'll work openly and transparently with Congress to get to the bottom of the scandal -- no stonewalling, no half-answers, no withholding of witnesses," said Senate Minority Leader Mitch McConnell, R-Ky.

Earlier in the day, the IRS released a question-and-answer sheet that sought to minimize the actions of its employees as "shortcuts" in a centralized process of reviewing certain applications for tax-exempt status.

The organizations in question had been flagged, the agency said, because they had "Tea Party," "patriot" or similar words that are associated with the conservative Tea Party movement. The IRS document said about 300 cases were flagged for special attention, about 70 them containing the name "Tea Party."

"IRS employees had seen cases of organizations with the name Tea Party in which political activity was an issue that needed to be reviewed for compliance with legal requirements," the IRS document said.

Even before Mr. Obama fired the acting commissioner, House Speaker John Boehner, R-Ohio, signaled that changes of personnel would not quell the storm of criticism. "My question isn't about who is going to resign; my question is who is going to go to jail over this," Mr. Boehner said.

The tax-exempt status sought by the Tea Party groups is granted to social welfare organizations. In recent years, similar organizations have cropped up, funded by groups on the left and right, and the organizations seem to have little to do with social welfare.

In his brief national address, Mr. Obama said Mr. Lew was also ordered to determine how the targeting of Tea Party groups for selective treatment came about. "We're going to hold the responsible parties accountable," the president said, pledging to work with Congress and calling upon lawmakers to put aside partisan differences in getting to the facts of the case.

Testifying before the House Judiciary Committee Wednesday afternoon, Attorney General Eric Holder said his agency actually opened an investigation into the IRS targeting after news broke about it Friday.

Senate Finance Committee Chairman Max Baucus, D-Mont., said he had met with Mr. Miller on Tuesday and warned that he would face very tough questioning from both parties in his panel's hearings Tuesday. "A team of investigators from my staff and Sen. Hatch's staff has begun compiling questions and is seeking additional documents from the IRS," Mr. Baucus said. "There seem to be some inconsistencies in the timeline regarding who knew what when, and we will get to the bottom of it."



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