Impeach IRS

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litical affiliation. The American people may never know1

the true culpability or extent of the Internal Revenue Serv-2

ice targeting because of the destruction of evidence that3

took place.4

Wherefore, John Andrew Koskinen, by such conduct,5

warrants impeachment and trial, and removal from office.6

ARTICLE II7

John Andrew Koskinen engaged in a pattern of de-8

ception that demonstrates his unfitness to serve as Com-9

missioner of the Internal Revenue Service. Commissioner.10

Koskinen made a series of false and misleading statements11

to Congress in contravention of his oath to tell the truth.12

Those false statements included the following:13

(1) On June 20, 2014, Commissioner Koskinen14

testified that since the start of this investigation,15

every email has been preserved. Nothing has been16

lost. Nothing has been destroyed..17

(2) On the same day, Commissioner Koskinen18

testified that the Internal Revenue Service had con-19

firmed that backup tapes from 2011 no longer ex-20

isted because they have been recycled, pursuant to21

the Internal Revenue Service normal policy. He22

went on to explain that [c]onfirmed means that23

somebody went back and looked and made sure that24

in fact any backup tapes that had existed had been25

recycled.26

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(3) On March 26, 2014, Commissioner1

Koskinen was asked during a hearing before the2

Committee on Oversight and Government Reform of3

the House of Representatives, Sir, are you or are4

you not going to provide this committee all of Lois5

Lerners emails? He answered, Yes, we will do6

that..7

Each of those statements was materially false. On8

March 4, 2014, Internal Revenue Service employees mag-9

netically erased 422 backup tapes containing as many as10

24,000 of Lois Lerners emails. On February 2, 2014, sen-11

ior Internal Revenue Service officials discovered that Lois12

Lerners computer hard drive had crashed, rendering hun-13

dreds or thousands of her emails unrecoverable. Commis-14

sioner Koskinens false statements impeded and confused15

congressional investigations into the Internal Revenue16

Service targeting of Americans based on their political af-17

filiation.18



ARTICLE III21

John Andrew Koskinen, throughout his tenure as22

Commissioner of the Internal Revenue Service, has acted23

in a manner inconsistent with the trust and confidence24

placed in him as an Officer of the United States, as fol-25

lows:26



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During his confirmation hearing before the Senate1

Committee on Finance, John Andrew Koskinen promised,2

[W]e will be transparent about any problems we run into;3

and the public and certainly this committee will know4

about those problems as soon as we do..5

Commissioner Koskinen repeatedly violated that6

promise. As early as February 2014 and no later than7

April 2014, he was aware that a substantial portion of8

Lois Lerners emails could not be produced to Congress.9

However, in a March 19, 2014, letter to Senator Wyden10

of the Senate Committee on Finance, Commissioner11

Koskinen said, We are transmitting today additional in-12

formation that we believe completes our production to13

your committee and the House Ways and Means14

[C]ommittee. . . . In light of these productions, I hope15

that the investigations can be concluded in the very near16

future.. At the time he sent that letter, he knew that17

the document production was not complete.18

Commissioner Koskinen did not notify Congress of19

any problem until June 13, 2014, when he included the20

information on the fifth page of the third enclosure of a21

letter to the Senate Committee on Finance.22





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TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION

Inappropriate Criteria Were Used to

Identify Tax-Exempt Applications for Review

May 14, 2013

Reference Number: 2013-10-053

This report has cleared the Treasury Inspector General for Tax Administration disclosure review processand information determined to be restricted from public release has been redacted from this document.

Redaction Legend:1 = Tax Return/Return Information

Phone Number | 202-622-6500

E-mail Address | [email protected]

Website | http://www.treasury.gov/tigta


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HIGHLIGHTS

INAPPROPRIATE CRITERIA WERE intervention was started soon after receipt, no

USED TO IDENTIFY TAX-EXEMPT work was completed on the majority of these

APPLICATIONS FOR REVIEW applications for 13 months. This was due todelays in receiving assistance from the Exempt

HighlightsOrganizations function Headquarters office.For the 296 total political campaign interventionapplications TIGTA reviewed as ofDecember 17, 2012, 108 had been approved,Final Report issued on May 14, 201328 were withdrawn by the applicant, none hadbeen denied, and 160 were open from 206 to

Highlights of Reference Number: 2013-10-0531,138 calendar days (some for more than

to the Internal Revenue Service Actingthree years and crossing two election cycles).

Commissioner, Tax Exempt and GovernmentEntities Division. More than 20 months after the initial case was

identified, processing the cases began inIMPACT ON TAXPAYERS

earnest. Many organizations received requests

Early in Calendar Year 2010, the IRS began for additional information from the IRS that

using inappropriate criteria to identify included unnecessary, burdensome questions

organizations applying for tax-exempt status to (e.g., lists of past and future donors). The IRS

review for indications of significant political later informed some organizations that they did

campaign intervention. Although the IRS has not need to provide previously requested

taken some action, it will need to do more so information. IRS officials stated that any donor

that the public has reasonable assurance that information received in response to a request

applications are processed without from its Determinations Unit was later destroyed.

unreasonable delay in a fair and impartialWHAT TIGTA RECOMMENDED

manner in the future.

TIGTA recommended that the IRS finalize theWHY TIGTA DID THE AUDIT

interim actions taken, better document the

TIGTA initiated this audit based on concernsreasons why applications potentially involving

expressed by members of Congress. The political campaign intervention are chosen for

overall objective of this audit was to determine review, develop a process to track requests for

whether allegations were founded that the IRS: assistance, finalize and publish guidance,

1) targeted specific groups applying for develop and provide training to employees

tax-exempt status, 2) delayed processing of before each election cycle, expeditiously resolve

targeted groups applications, and 3) requested remaining political campaign intervention cases

unnecessary information from targeted groups. (some of which have been in process forthree years), and request that social welfare

WHAT TIGTA FOUND activity guidance be developed by theDepartment of the Treasury.

The IRS used inappropriate criteria thatidentified for review Tea Party and other In their response to the report, IRS officialsorganizations applying for tax-exempt status agreed with seven of our nine recommendations

based upon theirnames or policy positions and proposed alternative corrective actions forinstead of indications of potential political two of our recommendations. TIGTA does notcampaign intervention. Ineffective management: agree that the alternative corrective actions will1) allowed inappropriate criteria to be developed accomplish the intent of the recommendationsand stay in place for more than 18 months, and continues to believe that the IRS should2) resulted in substantial delays in processing better document the reasons why applicationscertain applications, and 3) allowed unnecessary potentially involving political campaigninformation requests to be issued. intervention are chosen for review and finalize

and publish guidance.Although the processing of some applicationswith potential significant political campaign


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Copies of this report are also being sent to the IRS managers affected by the report

recommendations. If you have any questions, please contact me or Gregory D. Kutz,Assistant Inspector General for Audit (Management Services and Exempt Organizations).

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Table of Contents

Background.......................................................................................................... Page 1

Results of Review............................................................................................... Page 5

The Determinations Unit Used Inappropriate Criteriato Identify Potential Political Cases .............................................................. Page 5

Recommendation 1: ..................................................................Page 10

Recommendations 2 and 3: .......................................................Page 11

Potential Political Cases Experienced SignificantProcessing Delays ......................................................................................... Page 11

Recommendations 4 and 5:.............................................. Page 16

Recommendations 6 through 8:......................................... Page 17

The Determinations Unit Requested UnnecessaryInformation for Many Potential Political Cases............................................ Page 18

Recommendation 9:........................................................ Page 21

Appendices

Appendix I Detailed Objective, Scope, and Methodology ........................ Page 22

Appendix II Major Contributors to This Report ........................................ Page 25

Appendix III Report Distribution List ....................................................... Page 26

Appendix IV Outcome Measures ............................................................... Page 27

Appendix V High-Level Organizational Chart of OfficesReferenced in This Report ............................................................................ Page 29

Appendix VI Timeline of Written Criteria for IdentifyingPotential Political Cases ................................................................................ Page 30

Appendix VII Comprehensive Timeline of Events ................................... Page 31

Appendix VIII Managements Response to the Draft Report ................... Page 44


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Abbreviations

BOLO Be On the Look Out

EO Exempt Organizations

I.R.C. Internal Revenue Code

IRS Internal Revenue Service


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Background

Organizations, such as charities, seeking Federal tax exemption are required to file an applicationwith the Internal Revenue Service (IRS). Other organizations, such as social welfareorganizations, may file an application but are not required to do so. The IRSs ExemptOrganizations (EO) function, Rulings and Agreements office, which is headquartered inWashington, D.C., is responsible for processing applications for tax exemption. Within theRulings and Agreements office, the Determinations Unit in Cincinnati, Ohio, is responsible forreviewing applications as they are received to determine whether the organization qualifies for

tax-exempt status.

In Fiscal Year 2012,170 percent of all closed applications for tax-exempt status were approvedduring an initial review with little or no additional information from the organizations. Ifsubstantial additional information is needed, the application is placed in unassigned inventoryuntil it can be assigned to a specialist in the Determinations Unit for further processing. Thespecialist develops a letter(s) requesting the additional information and issues it to theorganization. Once the specialist receives all the necessary information to determine whether anorganization should be afforded tax-exempt status, a final determination letter is issued to theorganization either approving or denying the request for tax-exempt status.

If the Determinations Unit needs technical assistance processing applications, it may call upon

the Technical Unit in the Rulings and Agreements office in Washington, D.C. 2 The IRSs goalfor processing all types of applications for tax-exempt status was 121 days in Fiscal Year 2012;however, some cases may take substantially longer. For example, the EO function states in itsFiscal Year 2013 Work Planthat applications requiring additional information are not assignedfor review until an average of five months after they are received.

Most organizations requesting tax-exempt status must submit either a Form 1023,Applicationfor Recognition of Exemption Under Section 501(c)(3) of the Internal Revenue Code, orForm 1024,Application for Recognition of Exemption Under Section 501(a), depending on thetype of tax-exempt organization it desires to be. For example, a charitable organization wouldrequest exemption under Internal Revenue Code (I.R.C.) Section () 501(c)(3),3whereas a social

welfare organization would request exemption under I.R.C. 501(c)(4).

4

1A 12-consecutive-month period ending on the last day of any month. The Federal Governments fiscal year beginson October 1 and ends on September 30.2For a high-level organizational chart of offices referenced in this report, see Appendix V.3I.R.C. 501(c)(3) (2012).4I.R.C. 501(c)(4) (2012).

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The I.R.C. section and subsection an organization is granted tax exemption under affects theactivities it may undertake. For example, I.R.C. 501(c)(3) charitable organizations areprohibited from directly or indirectly participating in or intervening in any political campaign onbehalf of or in opposition to any candidate for public office (hereafter referred to as politicalcampaign intervention).5 However, I.R.C. 501(c)(4) social welfare organizations,I.R.C. 501(c)(5)6agricultural and labor organizations, and I.R.C. 501(c)(6) 7business leaguesmay engage in limited political campaign intervention. Figure 1 highlights certain characteristicsof common types of tax-exempt organizations.

Figure 1: Characteristics of CertainCommon Types of Tax-Exempt Organizations

I.R.C. 501(c)(4),Characteristic I.R.C. 501(c)(3) (c)(5), and (c)(6)

May receive tax deductible charitablecontributions.

Yes No

May engage in political campaignintervention.

NoLimited (must not constitute

primary activity of organization)

Must publicly disclose the identityits donors.

ofNo No

May engageactivity).

in lobbying8(i.e., legislative Limited (must notbe substantial)

Yes (unlimited amountif in furtherance of

tax-exempt purposes)

9May engage in general advocacy notrelated to legislation or the election ofcandidates.

Yes (permitted as aneducational activity)

Yes (unlimited amountif in furtherance of

tax-exempt purposes)

Must apply with the IRS. Yes No

Source: Draft Advocacy Guide Sheet and Internal Revenue Manual.

5Political campaign intervention is the term used in Treasury Regulations 1.501(c)(3)-1, 1.501(c)(4)-1,1.501(c)(5)-1, and 1.501(c)(6)-1.6I.R.C. 501(c)(5) (2012).7I.R.C. 501(c)(6) (2012).8An organization engages in lobbying, or legislative activities, when it attempts to influence specific legislation bydirectly contacting members of a legislative body (Federal, State, or local) or encouraging the public to contact thosemembers regarding that legislation. An organization also engages in lobbying when it encourages the public to takea position on a referendum. Lobbying is distinguished from political campaign intervention because lobbying doesnot involve attempts to influence the election of candidates for public office.9An organization engages in general advocacy when it attempts to 1) influence public opinion on issues germane tothe organizations tax-exempt purposes, 2) influence nonlegislative governing bodies (e.g., the executive branch orregulatory agencies), or 3) encourage voter participation through get out the vote drives, voter guides, andcandidate debates in a nonpartisan, neutral manner. General advocacy basically includes all types of advocacy otherthan political campaign intervention and lobbying.

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During the 2012 election cycle, the activities of tax-exempt organizations received mediacoverage concerning the amount of money spent on influencing elections. According to theCenter for Responsive Politics, tax-exempt groups, such as I.R.C. 501(c)(4), I.R.C. 501(c)(5),and I.R.C. 501(c)(6) organizations, spent $133 million in Calendar Year 2010 on Federalcandidate-oriented expenditures. In Calendar Year 2012, this figure increased to $315 million.10In addition, as shown in Figure 2, the number of applications for tax-exempt status has increasedover the past four fiscal years.11

Figure 2: Number of Applications forI.R.C. 501(c)(3)(6) Tax-Exempt

Status Received by the IRS

FiscalYear

I.R.C. Subsection501(c)(3) 501(c)(4) 501(c)(5) 501(c)(6)

2009 65,179 1,751 543 1,828

2010 59,486 1,735 290 1,637

2011 58,712 2,265 409 1,836

2012 66,543 3,357 1,081 2,338

Source: These data were provided by the EO function as

background and were not validated for accuracy or reliability.

During the 2012 election cycle, some members of Congress raised concerns to the IRS aboutselective enforcement and the duty to treat similarly situated organizations consistently. Inaddition, several organizations applying forI.R.C. 501(c)(4) tax-exempt status made allegations thatthe IRS 1) targeted specific groups applying for tax-exemptstatus, 2) delayed the processing of targeted groupsapplications for tax-exempt status, and 3) requestedunnecessary information from targeted organizations.Lastly, several members of Congress requested that the IRSinvestigate whether existing social welfare organizationsare improperly engaged in a substantial, or evenpredominant, amount of campaign activity.

We initiated this audit based on concerns expressed by Congress and reported in the mediaregarding the IRSs treatment of organizations applying for tax-exempt status. We focused our

10The Center for Responsive Politics obtained its information from the Federal Election Commission. We onlyincluded expenditures reported to the Federal Election Commission specifically for advocating the election or defeatof clearly identified Federal candidates.11Some of this increase may be due to the reapplication of those organizations whose tax-exempt status was revokedas a result of not filing information returns for three consecutive years.

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This audit focused onallegations that the IRS targeted

specific groups applying fortax-exempt status, delayed the

processing of targeted groupsapplications, and requested

unnecessary information fromtargeted organizations.


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efforts on reviewing the processing of applications for tax-exempt status and determiningwhether allegations made against the IRS were founded.12 Tax-exempt application case fileswere selected for review in June 2012 and were reviewed as provided by the EO functionbetween July and November 2012. We did not review whether specific applications fortax-exempt status should be approved or denied.

This review was performed at the EO function Headquarters office in Washington, D.C., and theDeterminations Unit in Cincinnati, Ohio, during the period June 2012 through February 2013.We conducted this performance audit in accordance with generally accepted governmentauditing standards. Those standards require that we plan and perform the audit to obtainsufficient, appropriate evidence to provide a reasonable basis for our findings and conclusionsbased on our audit objective. We believe that the evidence obtained provides a reasonable basis

for our findings and conclusions based on our audit objective. Detailed information on our auditobjective, scope, and methodology is presented in Appendix I. Major contributors to the reportare listed in Appendix II.

12A future audit is being considered to assess how the EO function monitors I.R.C. 501(c)(4)(6) organizationsto ensure that political campaign intervention does not constitute their primary activity.

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Results of Review

The Determinations Unit Used Inappropriate Criteria to IdentifyPotential Political Cases

The Determinations Unit developed and used inappropriate criteria to identify applications fromorganizations with the words Tea Party in their names. These applications (hereafter referred toas potential political cases)13were forwarded to a team of specialists14for review. Subsequently,

the Determinations Unit expanded the criteria to inappropriately include organizations with otherspecific names (Patriots and 9/12) or policy positions. While the criteria used by theDeterminations Unit specified particular organization names, the team of specialists was alsoprocessing applications from groups with names other than those identified in the criteria. Theinappropriate and changing criteria may have led to inconsistent treatment of organizationsapplying for tax-exempt status. For example, we identified some organizations applicationswith evidence of significant political campaign intervention that were not forwarded to the teamof specialists for processing but should have been. We also identified applications that wereforwarded to the team of specialists but did not have indications of significant political campaignintervention. All applications that were forwarded to the team of specialists experiencedsubstantial delays in processing. Although the IRS has taken some action, it will need to do

more so that the public has reasonable assurance that applications are processed withoutunreasonable delay in a fair and impartial manner in the future.

Criteria for selecting applications inappropriately identified organizations basedon their names and policy positions

The Determinations Unit developed and began using criteria to identify potential political casesfor review that inappropriately identified specific groups applying for tax-exempt status based ontheir names or policy positions instead of developing criteria based on tax-exempt laws andTreasury Regulations.

**********************************1*****************************************

**********************************1********************************************1***. According to media reports, some organizations were classified as I.R.C. 501(c)(4)social welfare organizations but operated like political organizations. ********1**********

13Until July 2011, the Rulings and Agreements office referred to these cases as Tea Party cases. Afterwards, theEO function referred to these cases as advocacy cases.14Initially, the team consisted of one specialist, but it was expanded to several specialists in December 2011. TheEO function referred to this team as the advocacy team.

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Some charitable organizations were eligible to sue the IRS for declaratoryjudgment due to the delays in processing applications

The Determinations Unit did not always timely approve or deny the applications forI.R.C. 501(c)(3) tax-exempt status for potential political cases. However, the tax law providesorganizations with the ability to sue the IRS to force a decision on their applications if the IRSdoes not approve or deny their applications within 270 calendar days.38

As of May 31, 2012,3932 (36 percent) of 89 I.R.C. 501(c)(3) potential political cases were openmore than 270 calendar days, and the organizations had responded timely to all requests foradditional information, as required. As of the end of our fieldwork, none of these organizationshad sued the IRS, even though they had the legal right. In another 38 open cases, organizations

were timely in their responses to additional information requests, but the 270-calendar-daythreshold had not been reached as of May 31, 2012. These 38 organizations may have the rightto sue the IRS in the future if determinations are not made within the 270-calendar-day period.

Recommendations

The Director, EO, should:

Recommendation 4: Develop a process for the Determinations Unit to formally requestassistance from the Technical Unit and the Guidance Unit.40 The process should include actionsto initiate, track, and monitor requests for assistance to ensure that requests are responded totimely.

Managements Response: The IRS agreed with this recommendation and willdevelop a formal process for the Determination Unit to request assistance and tomonitor such requests.

Recommendation 5: Develop guidance for specialists on how to process requests fortax-exempt status involving potentially significant political campaign intervention. Thisguidance should also be posted to the Internet to provide transparency to organizations on theapplication process.

Managements Response: The IRS proposed alternative corrective action to ourrecommendation. The IRS will develop training on the topics described in

Recommendations 3, 5, 6, and 9. Because election cycles are continuous, the IRS

38Revenue Procedure 2012-09 provides further guidance on the implementation of this right.39Tax-exempt application case files were selected for review in June 2012 based on a May 31, 2012, listing ofapplications being processed by the team of specialists.40The Guidance Unit provides formal and informal guidance that explains how certain laws, such as regulations,revenue rulings, revenue procedures, notices, and announcements, may apply to exempt organizations.

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noted that it will develop a schedule which ensures that staff have the training asneeded to handle potential political intervention matters.

Office of Audit Comment: We do not believe that this alternative corrective actionfully addresses our recommendation. We believe that specific guidance should bedeveloped and made available to specialists processing potential political cases. Makingthis guidance available on the Internet for organizations could also address a concernraised in the IRSs response that many applications appear to contain incomplete andinconsistent information.

Recommendation 6: Develop training or workshops to be held before each election cycleincluding, but not limited to: a) what constitutes political campaign intervention versus general

advocacy (including case examples) and b) the ability to refer for follow-up those organizationsthat may conduct activities in a future year which may cause them to lose their tax-exempt status.

Managements Response: The IRS agreed with this recommendation and willdevelop training on the topics described in Recommendations 3, 5, 6, and 9. Becauseelection cycles are continuous, the IRS reported that it will develop a schedule whichensures that staff have the training as needed to handle potential political interventionmatters.

Recommendation 7: Provide oversight to ensure that potential political cases, some of whichhave been in process for three years, are approved or denied expeditiously.

Managements Response: The IRS agreed with this recommendation and stated

that, while this is an ongoing project, it is closely overseeing the remaining open casesto ensure that it reaches determinations as expeditiously as possible.

The Acting Commissioner, Tax Exempt and Government Entities Division, should:

Recommendation 8: Recommend to IRS Chief Counsel and the Department of the Treasurythat guidance on how to measure the primary activity of I.R.C. 501(c)(4) social welfareorganizations be included for consideration in the Department of the Treasury Priority GuidancePlan.41

Managements Response: The IRS agreed with this recommendation and willshare this recommendation with the IRS Chief Counsel and the Department of

Treasurys Office of Tax Policy.

41The Department of the Treasury issues a Priority Guidance Plan each year to identify and prioritize the tax issuesthat should be addressed through regulations, revenue rulings, revenue procedures, notices, and other publishedadministrative guidance.

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The Determinations Unit Requested Unnecessary Information forMany Potential Political Cases

The Determinations Unit sent requests for information that we later (in whole or in part)determined to be unnecessary for 98 (58 percent) of 170 organizations that received additionalinformation request letters.42 According to the Internal Revenue Manual, these requests shouldbe thorough, complete, and relevant. However, the Determinations Unit requested irrelevant(unnecessary) information because of a lack of managerial review, at all levels, of questionsbefore they were sent to organizations seeking tax-exempt status. We also believe thatDeterminations Unit specialists lacked knowledge of what activities are allowed byI.R.C. 501(c)(3) and I.R.C. 501(c)(4) tax-exempt organizations. This created burden on the

organizations that were required to gather and forward information that was not needed by theDeterminations Unit and led to delays in processing the applications. These delays could resultin potential donors and grantors being reluctant to provide donations or grants to organizationsapplying for I.R.C. 501(c)(3) tax-exempt status. In addition, some organizations may not havebegun conducting planned charitable or social welfare work.

After receiving draft guidance in November 2011, the team of specialists began sending requestsfor additional information in January 2012 to organizations that were applying for tax-exemptstatus. For some organizations, this was the second letter received from the IRS requestingadditional information, the first of which had been received more than a year before this date.These letters requested that the information be provided in two or three weeks (as is customary in

these letters) despite the fact that the IRS had done nothing with some of the applications formore than one year. After the letters were received, organizations seeking tax-exempt status, aswell as members of Congress, expressed concerns about the type and extent of questions beingasked. For example, the Determinations Unit requested donor information from27 organizations43that it would be required to make public if the application was approved, eventhough this information could not be disclosed by the IRS when provided by organizationswhose tax-exempt status had been approved. Figure 7 shows an example of requests sent toorganizations applying for tax-exempt status regarding donors.

42See Appendix IV.43Of the 27 organizations, 13 had Tea Party, Patriots, or 9/12 in their names.

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Figure 8: Seven Questions Identified As Unnecessary by the EO Function

Number Question

1 Requests the names of donors.

2 Requests a list of all issues that are important to the organization and asks thatthe organization indicate its position regarding such issues.

3 Requests 1) the roles and activities of the audience and participants other thanmembers in the activity and 2) the type of conversations and discussionsmembers and participants had during the activity.

4 Asks whether the officer, director, etc., has run or will run for public office.

5 Requests the political affiliation of the officer, director, speakers, candidatessupported, etc., or otherwise refers to the relationship with identifiedpolitical partyrelated organizations.

6 Requests information regarding employment, other than for the organization,including hours worked.

7 Requests information regarding activities of another organization not justthe relationship of the other organization to the applicant.

Source: EO function review of additional information request letters.

We reviewed case file information for all 170 organizations that received additional information

request letters and determined that 98 (58 percent) had received requests for information that waslater deemed unnecessary by the EO function. Of the 98 organizations:

15 were informed that they did not need to respond to previous requests for informationand, instead, received a revised request for information.

12 either received a letter or a telephone call stating that their application was approvedand they no longer needed to respond to information requests they had received from theIRS.

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Appendix V

High-Level Organizational Chart

of Offices Referenced in This Report

The following is a high-level organizational chart of offices we discuss in this report, startingwith the Deputy Commissioner for Services and Enforcement, who reports to the IRSCommissioner.

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Acting Commissioner, Tax

Exempt and Government

Entities DivisionWashington, DC

Deputy Commissioner for

Services and EnforcementWashington, DC

Senior Technical

AdvisorWashington, DC

Director, EOWashington, DC

Director, Rulings

and AgreementsWashington, DC

Program

Manager,

Determinations

UnitCincinnati, OH

Technical

SpecialistsWashington, DC

Manager,

Technical Unit

Washington, DC

Manager,

Guidance Unit

Washington, DC

Determinations

SpecialistsCincinnati, OH

Guidance

SpecialistsWashington, DC

Senior TechnicalAdvisor

Washington, DC


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Page 41

Date Event Additional Details Source

May 8, 2012 The Determinations Unit Program Manager wasinformed that EO function Headquarters officeemployees planned to visit Cincinnati, Ohio, to providetraining on cases and perform a review of the cases torecommend what additional actions, if any, were neededto make a determination.

E-Mail

May 9, 2012 The Director, Rulings and Agreements, asked about theprocess for updating the BOLO listing.

E-Mail

May 1415,2012

Training was held in Cincinnati, Ohio, on how to processidentified potential political cases. The Senior Technical

Advisor to the Director, EO, took over coordination ofthe team of specialists from the Determinations Unit.

E-Mail

May 16, 2012 A joint team of Determinations Unit specialists andEO function Headquarters office employees beganreviewing all potential political cases began inCincinnati, Ohio. Cases were divided into four groupswith recommendations for how to proceed: favorabledetermination, favorable with limited development,significant development, and probably adverse. Thistook around three weeks to complete. A worksheet wasused to document the reviews.

E-Mail

May 17, 2012 The Director, Rulings and Agreements, issued a

memorandum outlining new procedures for updating theBOLO listing. The BOLO listing criteria were updatedagain. New criteria reads: 501(c)(3), 501(c)(4),501(c)(5), and 501(c)(6) organizations with indicators ofsignificant amounts of political campaign intervention(raising questions as to exempt purpose and/or excessprivate benefit).

Suggested additions and

changes must be approvedby a Determinations Unitcoordinator, theDeterminations UnitProgram Manager, and theDirector, Rulings andAgreements.

Interview

and E-Mail

May 21, 2012 The EO function determined that the requested donorinformation could be destroyed or returned to theapplicant if not used to make the final determination oftax-exempt status. It does not need to be kept in theadministrative file. A letter would be issued to theorganizations informing them that the donor informationwas destroyed.

Interviewand E-Mail

May 24, 2012 A telephone call script was developed to inform someorganizations that had not responded to the additionalinformation requests that it was not necessary to send therequested information and that their applications hadbeen approved. Also, an additional paragraph wasdeveloped for the determination letter.

E-Mail


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