Sen. Max Baucus has been the point man for some of the nation’s most heated political debates in recent years. Perhaps that comes with the territory when you’re the chairman of the powerful Senate Finance Committee and you sign on as head architect of a sweeping federal health care law overhaul.
So it only seems natural that Baucus, a month after announcing his retirement intentions, has once again found himself in the middle of a delicate and headline-grabbing situation: the Internal Revenue Service’s targeting of conservative groups.
The IRS is embroiled in controversy after admitting earlier this month that it subjected tea party-affiliated and other conservative organizations to increased scrutiny when considering tax-exempt status leading up to the 2012 elections.
On May 13, Baucus had harsh words for the IRS and pledged to hold hearings in his finance committee, which has jurisdiction over tax issues. The Montana Democrat said the IRS singling out groups based on political affiliation was “an outrageous abuse of power and a breach of the public’s trust.” The finance committee was scheduled to hold a hearing on May 21.
“Targeting groups based on their political views is not only inappropriate but it is intolerable,” Baucus said. “Americans expect the IRS to do its job without passion or prejudice. We need to get to the bottom of what happened here.”
In Montana, leaders of several conservative groups say they haven’t found any evidence suggesting the Internal Revenue Service specifically targeted them when they applied for tax-exempt status, but they claim the controversy is nonetheless another illustration of unfair and hypocritical treatment of right-leaning organizations.
Eric Olsen, co-founder of the Montana Shrugged Tea Party Patriots out of Billings, said his group started applying for tax-exempt status but decided it wasn’t necessary. Olsen said the process is already onerous and overly complex without the IRS singling out an application for heightened scrutiny.
“Even if you’re not targeted by the IRS, the paperwork is scary,” he said. “We didn’t really get far enough with the feds to see if the IRS was holding it up.”
He added he wasn’t surprised to find out the Obama administration was singling out conservative groups. For his part, President Obama condemned the IRS’ actions as “inexcusable.”
“It’s just the antics of this administration to always go against the people who are against him,” Olsen said.
Donny Ferguson, the former director of American Tradition Partnership, said the IRS controversy is another attempt to “smear conservatives.” Ferguson said he is no longer affiliated with ATP, which has operated as a 501(c)(4) issue advocacy organization.
“As far as I know ATP’s dealings with the IRS were smooth and without trouble,” Ferguson said in an email to the Beacon. “ATP always has and always will follow every letter of every applicable law.”
Joe Balyeat, a former state lawmaker from Belgrade and the state director for Americans for Prosperity, said his group hasn’t encountered any noteworthy problems with the IRS, but he knows of one tea party group that has had troubles and is still waiting on its tax-exempt application.
But Balyeat, a certified public accountant, noted that the tax-exempt application process always requires “quite a bit of rigmarole,” making it hard to distinguish between the IRS simply conducting business as usual or singling out an organization. The fact that the IRS is admitting to targeting specific groups is a sign that the “weight of the evidence” must have been overwhelming, he said.
“From the perspective of the applicant, it’s difficult to point with any certainty that they’re being treated unfairly because everyone has some back and forth,” he said.
Balyeat said he believes the 501(c)(4) status serves a purpose, for groups affiliated with both the left and right, of allowing freedom of expression while protecting identities. He pointed to the National Association for the Advancement of Colored People (NAACP) as an example. Americans for Prosperity is a 501(c)(4), while its foundation is a 501(c)(3).
“It’s a way for them to express their freedom of speech as a group and have some degree of anonymity,” Balyeat said. “With the NAACP, their identities were protected for a reason.”
Steven Miller, the acting IRS commissioner, stepped down under pressure and apologized for what he characterized as mistakes by certain employees rather than a politically motivated effort by the agency. The full extent of the controversy’s fallout may become more clear as the House and Senate conduct their separate hearings.
Baucus said before his committee’s hearing that he wanted to see all of the facts and review the inspector general’s report, but promised to “get answers.”
“The IRS should be prepared for a full investigation into this matter by the Senate Finance Committee,” the senator said. “The IRS will now be the ones put under additional scrutiny.”