The Oct. 12 report, prepared by the staff of the Washington, DC-based Cause of Action Institute, said the Obama administration has made “frequent and damaging use of the IRS as a political weapon.”
But, the report said, the Obama White House is not the first to do so, and recommended several changes to taxpayer privacy laws and regulations to prevent future presidents from bending the rules in their favor.
The report also said the Obama administration has made extensive use of Justice Department tax lawyers in the Office of White House Counsel, including some who were directly involved in defending the IRS in court against charges the agency illegally disclosed private tax information for political purposes.
Cause of Action investigators looked at the legal barriers that are supposed to keep presidents and their administrations from improperly reviewing, and disclosing, private taxpayer information.
Under the Tax Reform Act of 1976, taxpayer information must be kept confidential, and can only be revealed under limited circumstances. All requests for review must be logged and recorded.
But, the report found, no president has ever used the two disclosure mechanisms outlined in federal law.
A president can submit a written, personally signed request to the Treasury secretary asking for specific information from an individual tax return. The request must also state why the information is needed, and specifically name whom else he intends to share the information with.
A second method, typically used to run checks on political appointees, allows the Treasury Secretary to disclose portions of an individual’s private tax information to designated White House personnel. But the IRS must notify the taxpayer of the request for their information within three days.
The president must also file a quarterly report to the congressional Joint Committee on Taxation naming any individual whose tax information has been requested, and the reasons why the request was made.
“No President has used either of these two pathways designed by Congress to be the exclusive means for presidential access to confidential taxpayer information,” Cause of Action investigators said.
Instead, individuals seeking a federal appointment have signed consent forms giving the White House and other government agencies the ability to glean whatever information they need from a tax return, all the while avoiding any congressional reporting requirements.
The investigation also found that the Obama administration has continually employed tax lawyers from the Department of Justice’s tax division in its Office of White House Counsel.
“This practice raises concern that the Obama White House may have recruited these tax attorneys in a further attempt to circumvent the statutory limitations on presidential access to such information,” the report said.
“President Obama wanted Tax Division lawyers,” investigators said, because their jobs at the Department of Justice gave them access to “confidential taxpayer information,” which the administration might then use “to target its political enemies.”
The report said neither the White House Counsel’s Office nor the Department of Justice had established “specific safeguards or ethics screens” to prevent tax division attorneys from using private taxpayer information they gleaned in court proceedings in their new White House roles.
The report said that two DoJ lawyers, Norah E. Bringer and Andrew C. Strelka, worked in the White House Counsel’s Office after defending IRS Commissioner John Koskinen in a lawsuit that alleged the IRS delayed an application for nonprofit status by the group Z Street, Inc. on political grounds.
Their roles in this, and other litigation, gave them access to sensitive taxpayer information, the report said, which they may have used and shared once they went to work in the White House.
In a written statement, a Justice Department representative told AMI Newswire it “takes safeguarding confidential taxpayer information very seriously.”
“The manner in which returns and return information is accessed, reviewed, and disclosed by attorneys is governed by statute and regulations. These requirements apply to every attorney while they are in the Tax Division, on a detail within the Department or other places in the government, and even after an attorney leaves federal service,” the representative said.
The Cause of Action Institute report recommended that Congress should reaffirm and strengthen taxpayer confidentiality rules, and crack down on the use of consent forms that allow presidents to skirt existing legal reporting requirements.
The report also called on the Department of Justice to “ensure DoJ lawyers live up to the ethical standards expected of them and to investigate allegations of misconduct.”
“Without legislative intervention and reform at the DOJ and IRS,” the report said, “the President’s ability to misuse taxpayer information will continue unabated.”