Hatch to IRS: Stand down on tax-exempt rules

Senate Finance Chairman Orrin Hatch (R-Utah) warned the IRS on Monday to stand down from any efforts to broaden out new rules governing social welfare groups. 

Two days ahead of Tax Day, Hatch told the IRS commissioner, John Koskinen, that any such move would undercut the agency’s efforts to regain the taxpayers’ trust. 

{mosads}Koskinen took over the agency after the IRS acknowledged singling out Tea Party groups seeking tax-exempt status, a controversy that still rages almost two years later and caused many senior IRS officials to lose their jobs. 

“Do not throw all of that away in a quixotic and bizarre mission to regulate the political activity of Americans. If you do so, in light of your agency’s recent history, your actions will be viewed with the presumption of political bias and bad faith,” Hatch wrote to Koskinen. 

“If you issue this proposed rule, Congress will have no choice but to investigate the reasons behind this power grab, be it political motivation or orders from officials at the Treasury Department or the White House.”

On top of that, Hatch told Koskinen that the IRS should start preserving documents dealing with rules governing tax-exempt groups.

The IRS has already had to pull back one proposed rule for the 501©(4) groups at the center of the Tea Party controversy, after groups on both the left and the right called it too broad.

Koskinen has said in recent weeks that he wants to see rules put in place for a wider range of tax-exempt groups. 

That, Hatch said, meant the IRS was “starting down a very dangerous road.”

“Rather than preventing further targeting, the new proposal – should you proceed with it – will be the systemization of targeting through law,” Hatch said.