IRS in political storm over Trump-era audits

The IRS is at the center of a political storm over audits conducted on former FBI Director James Comey and former Deputy Director Andrew McCabe.

Both had high-profile fights with former President Trump, and the rare audits were conducted on Trump’s watch under the Trump-appointed IRS Commissioner Charles Rettig.

Lawmakers on Thursday were calling for a full investigation into whether the two Trump adversaries had been illegally targeted, and if so, how.

“The possibility that the former President or someone in the White House, his cabinet, his appointees, or leadership working under the Trump-appointed IRS Commissioner may have requested an audit of those deemed disloyal is alarming,” House Ways and Means Committee Chairman Richard Neal (D-Mass.) said in a statement Thursday.

“It is unconscionable that someone within the IRS may have acted on this request out of loyalty to the Trump administration or fear of retaliation for failing to act,” he said.

Comey was fired by President Trump in 2017, during the FBI’s probe into possible relationships between the Russian government and Trump’s 2016 campaign team. There was speculation at the time that his firing may have taken the momentum out of the investigation. 

McCabe took over for Comey as acting director of the FBI and was fired by Trump’s Attorney General Jeff Sessions in 2018. He became a vocal critic of the administration after his firing and joined CNN as a contributor.

According to The New York Times, Comey and McCabe were both served a rare and highly demanding type of IRS audit following their firings.

These audits are part of something called the National Research Program at the IRS, which goes through taxpayers’ returns in microscopic detail and requires intense and time-consuming back-and-forth with the agency. Only a few thousand of these special kinds of resource-intensive audits are carried out each year.

There was a 1-in-30,000 chance of Comey getting the National Research Program audit and a 1-in-20,000 chance of McCabe getting the audit, according to the Times. Taken together, that’s about a 1-in-600 million chance of two randomly selected individuals receiving the same audit in a pool of more than 150 million U.S. taxpayers.

This is hardly the first time the IRS has been accused of playing a political game with tax collections and enforcement.

Republicans on Capitol Hill have been quick to point out that there was a similar controversy during the Obama administration concerning the tax-exempt status of certain conservative groups.

“As we learned from the repeated targeting of conservative groups and the dangerous leaking of private tax returns under the Obama and Biden Administrations, the IRS should never be used as a weapon against political opponents,” Ways and Means ranking member Rep. Kevin Brady (R-Texas) said in a Thursday statement.

“Commissioner Rettig has stated unequivocally he has had no communication with President Trump, and the research audits are statistically generated,” Brady continued. “He has referred this issue to the Treasury Inspector General for Tax Administration, and I support investigating all allegations of political targeting – consistent with the precedent set by the House Ways and Committee when investigating President Obama’s disgraced former IRS director Lois Lerner, who the committee confirmed had engaged in this abuse.”

Lerner in 2013 headed an IRS division that oversaw tax-exempt organizations. Certain conservative organizations began receiving extra scrutiny at the time, triggering a huge controversy during the Obama era over whether those groups were being targeted for unfair treatment.

Democrats also opened the history books to find evidence of foul play at the IRS, with Neal pointing to former President Nixon as an example.

“These allegations are reminiscent of another time when a president inappropriately used the IRS to target his enemies,” Neal said in his statement, referring to a conversation Nixon had with two aides in the Oval Office in 1971, in which he described the ideal qualities for the next IRS commissioner.

At that time, Nixon said, “I want to be sure he is a ruthless son of a [b—-], that he will do what he’s told, that every income tax return I want to see I see, that he will go after our enemies and not go after our friends,” according to a transcript published years later in the Washington Post.

White House press secretary Karine Jean-Pierre declined to answer a question about whether President Biden still has confidence in IRS Commissioner Rettig following the allegations.

“As you know, the IRS commissioner, his term is up in November, but I don’t have any updates on that,” Jean-Pierre said. “Can’t speak to anything more besides, you know, we would refer you to the IRS on that specific thing. And he is going to be up in November, so I will leave it there.”

The IRS said it is referring Comey and McCabe’s cases to the Treasury inspector general’s office.

“The IRS has referred the matter to the Treasury Inspector General for Tax Administration for review. IRS Commissioner Rettig personally reached out to TIGTA after receiving a press inquiry,” the agency said in a Thursday statement.

“Federal Privacy laws preclude us from discussing specific taxpayer situations,” the IRS added. “Audits are handled by career civil servants, and the IRS has strong safeguards in place to protect the exam process – and against politically motivated audits. It’s ludicrous and untrue to suggest that senior IRS officials somehow targeted specific individuals for National Research Program audits.”