Obama Downplays Scandal as IRS Reinstates 2013 Bonus

President Obama continues to attempt to make the case that IRS leaders did nothing inappropriate when they targeting conservative organizations in the 2010 and 2012 elections.

In an interview conducted by Bill O’Reilly on Sunday during the Super Bowl, President Obama said the actions by the IRS to delay tax-exempt applications of Tea Party and other conservative organizations were not an act of corruption on any level.

“Not even mass corruption, not even a smidgen of corruption,” said President Obama.

President Obama Denies Political Agenda in IRS Targeting

President Obama objected to the suggestion that the targeting efforts were driven by political motivations, at his direction or the direction of other members of the Democratic party in an effort to limit the ability of conservative organizations to support candidates running against them.

“That’s not what happened,” said President Obama.  Instead, he called the actions “bone-headed decisions,” noting IRS leaders and field agents were simply confused about how to implement laws properly regarding the review of applications for tax-exempt status.

During times leading up to the 2010 and 2012 elections, President Obama agreed that Doug Shulman, the IRS Commissioner at the time, visited the White House over 100 times.  However, President Obama said he did not remember meeting with Shulman during any of those visits.

IRS Leaders Reinstate 2013 Bonuses

Following the president’s remarks, new IRS Commissioner John Koskinen announced on Monday that he was reinstating bonuses for IRS leaders that were cancelled in 2013 in large part because of the targeting scandal.

The decision quickly drew criticism from Congressional leaders, including Senator Orrin Hatch, Republican-Utah and the highest-ranking Republican member of the Senate Finance Committee.

“The IRS is accused of targeting conservative groups, with many of its employees having conducted themselves in a manner inappropriate for government officials,” said Senator Hatch.  “And the agency decides to reinstate employee bonuses?  This is outrageous.”

Koskinen noted during the announcement that he was reinstating the bonuses because numerous IRS employees had asked him about them during the first month in his new role.  However, Koskinen noted that because of the continue issues with the IRS attaining its budget, the bonuses would be paid at the rate of 1 percent, rather than the average rate of 1.75 percent paid in previous years.

“It’s hard to think of a group of people less deserving of bonuses than IRS employees,” continued Senator Hatch.  “I understand that not every IRS worker was responsible, but this just is the wrong signal to send the American people who were rightly outraged by how this agency treated people for their political views.”

The targeting scandal first became known publicly in early 2013, leading to investigations by the Office of the Inspector General and the FBI.  IRS leadership at the time indicated initially that the targeting was solely the effort of IRS agents in the Cincinnati field office.

However, e-mails and other efforts uncovered in the investigation made it clear that IRS agents in Cincinnati were acting under the direction and knowledge of at least some IRS leaders in Washington.

As a result of the scandal, President Obama asked IRS Commissioner Steven Miller to resign in May 2013.  Many deemed Lois Lerner, the Director of Exempt Organizations for the IRS, to be most directly responsible for the targeting.  In spite of her comments when news of the scandal broke that laid blame squarely on rogue IRS agents in Cincinnati, Lerner eventually resigned her position in September 2013.

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by Mark Johnston

Mark has been a contributor to legal web sites related to bankruptcy, tax, and criminal law since 2011. He has an Accounting degree from Texas A&M University.