IRS Lawsuit

A Look Back at the IRS Targeting Scandal

In 2017,  the Internal Revenue Service  (IRS) admitted its involvement in the targeting of Tea Party and other conservative groups during the Obama administration. From 2009 to 2012, there were 36 Tea Party and other conservative organizations from 20 states that applied for 501(c)(3) and (c)(4) tax-exempt status with the IRS, but the agency singled out the applications from these groups.

The IRS had denied the allegations many times before it finally admitted the misconduct of its officials. The IRS apologized and agreed to have a court order that would prohibit the agency from any form of unconstitutional discrimination.


Dozens of Tea Party and conservative groups were reportedly being harassed by Obama’s IRS. Their tax-exempt applications were held up for years and they were asked for information that is deemed “unconstitutional”. This controvery took almost more than five years of fighting against the agency.


On May 10, 2013, Lois Lerner, the former head of the IRS Tax Exempt Organizations Division, gave a comment insinuating the political targeting by the IRS.

The American Center for Law and Justice (ACLJ) filed a lawsuit against the IRS for the following:

  1. Targeted the conservative groups
  2. Delayed the processing of tax-exempt applications
  3. Harassed leaders and members of the conservative groups
  4. Asked for other unnecessary information such as donor lists, Internet usernames and passwords, and political and/or charitable activities.


The district court dismissed ACLJ’s claims and said that the IRS had voluntarily stopped its misconduct.


However, in August 2016, the U.S. Court of Appeals for the D.C. Circuit appealed that the IRS did not provide enough pieces of evidence to support its innocence over the targeting scheme.

Later on, documents surfaced that the IRS during the Obama administration had assigned a special group to single out the applications related to the Tea Party. Other conservative groups had been included on “Be on the Lookout” BOLO lists, too. These efforts were orchestrated to limit their impact on the 2012 elections.

How did the IRS do such serious misconduct? Other government agencies, including the FBI and DOJ during the Obama administration, had their participation in the targeting scandal.

The Consent Order filed by the parties will help prevent the IRS from doing the targeting again for its political or personal purposes. The Consent Order states that:

  • A declaration by the Court that it is inappropriate to apply the United States tax code to any tax-exempt applicant or entity based on its name and political viewpoint. 
  • A declaration by the Court that any action or inaction taken by the IRS must be done fairly or objectively, not based on the tax-exempt applicant’s name or any political viewpoint.
  • A declaration by the Court that any discrimination based solely on an individual or entity’s political viewpoint is unlawful or a violation of the First Amendment rights. 


The IRS agreed that the “sharing, dissemination, and use of the information” obtained from those groups will be considered unlawful. The Order also required the IRS to inform all of its employees and the higher-ups −  Exempt Organizations Division, Commissioners and Deputy Commissioners − to adhere to these rules and to ensure the people that the agency is true to its duties and responsibilities. 


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