Disgraced Lois Lerner out at Internal Revenue

Lois Lerner, the embattled IRS official who first revealed the agency had singled out Tea Party groups for extra scrutiny, is retiring, the IRS said Monday.

Lerner had been on administrative leave since shortly after she plunged the IRS into controversy in May by apologizing for the agency’s treatment of conservative organizations.

{mosads}But a Democratic aide told The Hill that an IRS review board was going to push to fire Lerner, after concluding that she had neglected her duties as the head of the division overseeing tax-exempt groups.

The aide added that Lerner had been informed of that decision and that the review also found no evidence of political bias or willful misconduct. Both GOP and Democratic lawmakers had previously lobbied for her to be fired.

The IRS did not comment any further on Lerner’s retirement Monday, citing federal privacy laws. Lerner’s attorney, Bill Taylor, did not respond to a request for comment.

Top GOP lawmakers said Monday’s announcement that Lerner was leaving the federal government after roughly three decades would not slow down their investigation into the IRS’s handling of Tea Party applications.

Lerner had invoked her Fifth Amendment right against self-incrimination before the House Oversight Committee in May. But the Oversight panel, led by Chairman Darrell Issa (R-Calif.), later ruled that Lerner had waived that right by proclaiming her innocence in an opening statement.

Issa said Monday that Lerner’s departure doesn’t “diminish the committee’s interest in hearing her testimony.” Lerner remains under an Oversight subpoena, which doesn’t expire until the end of the current Congress.

“We still don’t know why Lois Lerner, as a senior IRS official, had such a personal interest in directing scrutiny and why she denied improper conduct to Congress,” Issa said. “Her departure does not answer these questions.”

Republicans have insisted that the IRS treated conservative groups far more harshly than their liberal counterparts and that they faced more invasive questioning and longer delays on their applications.

GOP lawmakers also have continued to make Lerner a core figure in their investigation into the IRS’s treatment of Tea Party groups, with Lerner coming up dozens of times at a House Ways and Means subcommittee hearing last week.

At that hearing, Republicans raised questions as to why Lerner’s signature was still on letters the IRS was sending in August. Danny Werfel, the interim IRS chief, told lawmakers that privacy laws limited how much he could say about Lerner’s status.

“Just because Lois Lerner is retiring from the IRS does not mean the investigation is over. Far from it,” Sen. Orrin Hatch (Utah), the top Republican on the Finance Committee, said in a statement. “In fact, there are many serious unanswered questions that must be addressed so we can get to the truth.”

Democrats have countered that the IRS also ensnared liberal groups with internal watch lists and stress that there’s been no evidence of political motivation or that anyone outside the agency was involved in the targeting.

On Monday, congressional Democrats said Lerner’s departure should help close this tumultuous chapter in the IRS’s history.

“Lois Lerner is being held responsible for her gross mismanagement of the IRS tax-exempt division,” said Rep. Sandy Levin (D-Mich.), the ranking member of the House Ways and Means Committee.

“As has been the case in all aspects of the current IRS investigation, the IRS internal review board found no evidence of political bias in her neglect of duties,” Levin said. “The basic overreaching premise of the Republicans that the IRS had an ‘enemies list’ … has been proven wrong again.”

The IRS originally placed Lerner on leave after she declined Werfel’s request to resign. Her decision to retire now instead of facing possible termination won’t affect her pension, according to a Democratic aide.

Lerner had disclosed the agency’s targeting of Tea Party groups in May by answering a planted question at a Washington tax conference, as the agency tried to get out in front of a looming inspector general’s report.

Steven Miller, the acting IRS commissioner pushed out by President Obama in May, later admitted the planted question was “was an incredibly bad idea.”

Obama nominated John Koskinen, who has a reputation as a corporate turnaround artist, to be the new IRS commissioner in August. The agency added in its Monday statement that it is “making important progress on fixing the underlying management and organizational deficiencies” in the exempt organization division.

“Our goal is to restore the public’s faith and trust in the tax system,” the statement said.

This story was posted at 3:12 p.m. and was updated at 8:17 p.m.