IRS Acting Director Appears Before House Panel

Jun 4, 2013
Originally published on June 4, 2013 8:10 am



This is MORNING EDITION, from NPR News. Good morning. I'm Renee Montagne.


And I'm Linda Wertheimer.

Today on Capitol Hill, Congress turns its attention to two federal institutions that have been losing the confidence of the American people. In a minute, we'll hear about an effort in the Senate to crackdown on sexual abuse in the U.S. military.

MONTAGNE: First, the House is moving through a series of hearings on an agency that's never been America's favorite, but whose popularity seems to be nearing a new low, and that's the IRS.

WERTHEIMER: This morning, the House Ways and Means Committee hears from conservative groups that say they were improperly targeted by the agency.

MONTAGNE: Then, this Thursday, another hearing will look into excessive spending by the Internal Revenue Service.

WERTHEIMER: And yesterday, the agency's new acting director appeared before Congress for the first time since taking the job.

NPR's Tamara Keith reports.

TAMARA KEITH, BYLINE: Danny Werfel is a long-time public servant who now has possibly the worst, or at least one of the hardest jobs in Washington. Ander Crenshaw, chairman of the House Appropriations Subcommittee that oversees the IRS, welcomed him to yesterday's hearing.


REPRESENTATIVE ANDER CRENSHAW: I want to congratulate you, if that's the right word, on your appointment, and thank you for taking this assignment at a very difficult time.

KEITH: Difficult may be an understatement. The inspector general for the IRS will release a report today, detailing nearly $50 million spent over three years on conferences for IRS employees - complete with silly videos produced at taxpayer expense, including this one, with a Star Trek theme.


UNIDENTIFIED MAN: To boldly go where no government employee has gone before.

KEITH: And that's just the icing. The real scandal, the reason Werfel is now on the job, is the way the IRS handled applications for tax-exempt status. Some conservative groups were flagged for extra scrutiny, and some have been waiting years for a decision. This is something Werfel addressed head on in his opening statement.


DANNY WERFEL: The use of certain political labels to determine how applications would be handled resulted in applications being inappropriately singled out for additional scrutiny. Moreover, there was a fundamental failure by IRS management to prevent this inconsistent treatment and insure that it was halted once management became aware.

KEITH: Werfel detailed what he's doing to try and make it right. There's a new management team in place, and by the end of this week, he's asked them to come up with a plan to resolve the outstanding applications for tax exempt status. And he's still working to figure out exactly what went wrong and why.

Chairman Crenshaw, a Florida Republican, cut right to why it matters with his first question.


CRENSHAW: Do you feel like the IRS has betrayed the trust of the American people?

WERFEL: I do, Mr. Chairman. I think that's why I'm thinking about this in terms of my primary mission is to restore that trust.

KEITH: Part of that, he said, will be getting all the facts out, and holding those who are responsible accountable. But who is to blame? That was a question Werfel wasn't prepared to answer.


WERFEL: The one point I would raise to you - and this is frustrating for everyone involved - is that more analysis and investigation is going to be needed to understand what motivated, if anything, this behavior. What were the circumstances surrounding it?

KEITH: The inspector general for the IRS, J. Russell George, also appeared before the committee. It was his fourth appearance since releasing his audit that revealed conservative groups had been improperly singled out. He was asked whether anyone questioned the IRS employees involved in the reviews about who ordered them to look at these groups in particular.


J. RUSSELL GEORGE: We did pose that question, and no one would acknowledge who, if anyone, provided that direction.

KEITH: In what is becoming a bit of a pattern for these hearings, Democrats tried to focus on larger issues in the tax law around 501(c)(4), so-called social welfare groups that engage in politics. And some Republicans tried to make it a story about the Obama administration targeting its enemies through the IRS.

There are now at least four ongoing investigations into the troubles at the IRS, and just this week, two more congressional hearings.

Tamara Keith, NPR News, the Capitol. Transcript provided by NPR, Copyright NPR.