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    Senior Member HAPPY2BME's Avatar
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    Feb 2005

    House GOP accuses IRS of obstructing investigation into abuse of power

    The Washington Times
    Tuesday, July 30, 2013
    By Stephen Dinan

    The agency's internal auditor initially said tea party groups were specifically targeted.

    "This is just the tip of the iceberg. We have received less than 3 percent of the documents responsive to the investigation."
    House Republicans on Tuesday accused the Internal Revenue Service and President Obama's hand-picked new leader of the agency of trying to "delay, frustrate, impede and obstruct" their investigation into abuses of conservative groups seeking tax-exempt status, and pointedly warned that it could be breaking the law.

    The two top investigators in the House sent a letter to acting Commissioner Danny Werfel, whom Mr. Obama tapped to get a grip on the troubled agency. They said the IRS has turned over less than one-tenth of 1 percent of the documents that the Committee on Oversight and Government Reform wants to see. The exact number is 0.019 percent of relevant documents, the investigators said.

    In one case, an IRS manager wanted to turn over documents but the agency refused to let her do so, Reps. Darrell E. Issa of California and Jim Jordan of Ohio wrote in a letter to Mr. Werfel. They said the documents that have been sent are so messy and full of redactions that it appears the IRS is trying to stall Congress.

    "Obstructing a congressional investigation is a crime," the two men said in the letter. "The systematic manner in which the IRS has attempted to delay, frustrate, impede and obstruct the committee's investigation raises serious concerns about your commitment to full and unfettered congressional oversight."

    The accusations were made on a day when another House panel, the Ways and Means Committee, released an analysis showing that conservative groups faced more intrusive questions than did liberal groups applying for the same tax-exempt status.

    Rep. Dave Camp, Michigan Republican and Ways and Means chairman, said conservative groups were asked three times as many questions and were less than half as likely to get approval from the IRS.

    Like the oversight committee, Mr. Camp said his investigators also are waiting for the IRS to turn over more information.

    "This is just the tip of the iceberg. We have received less than 3 percent of the documents responsive to the investigation," he said.

    The IRS denied that it was trying to stonewall the investigations. Spokeswoman Michelle Eldridge said the agency has received "numerous data requests" from Congress and is trying its best to comply.

    She said the IRS has tapped 70 lawyers to process the documents, which require review to make sure confidential taxpayer information isn't disclosed.

    "We have been in contact with committee staff, and we continue to provide them updates as we diligently work through these requests," Ms. Eldridge said.

    She said the committee is misleading when it says 65 million pages of documents are relevant to the investigation — the figure that produced the 0.019 percent number. She said the IRS expects to produce no more than 460,000 documents.

    Questions continue to swirl around IRS efforts to vet tea party and conservative groups that applied for tax-exempt status, especially in the wake of the Supreme Court's Citizens United case that opened the door for groups to engage more freely in political speech.

    The agency's internal auditor initially said tea party groups were specifically targeted, though he later reported that some liberal groups were also part of the special scrutiny.

    Rep. Sander M. Levin of Michigan, the ranking Democrat on the Ways and Means Committee, said Tuesday that there has been no evidence linking the IRS behavior to the White House and that Republican analysis of the data is misleading.

    "The overwhelming fact remains that Republicans will do everything they can to deflect attention from their inability to do almost anything — a record that has earned them historically low ratings from the American public," Mr. Levin said.

    Republicans say the information they are uncovering suggests bigger problems at the IRS.

    On Monday, Mr. Issa and Mr. Jordan asked for a broader investigation. In addition to special scrutiny for new applications, they said, the IRS also went after groups that had been approved years earlier, putting them through audits and asking inappropriate questions.

    The two lawmakers said the documents that the IRS has turned over to their committee often have portions blacked out well beyond what would be necessary to protect taxpayer information.

    Before he was sent to the IRS, Mr. Werfel was a top official in Mr. Obama's budget office at the White House.

    He was deployed to the tax agency after the acting commissioner resigned in the days after the agency acknowledged that it improperly targeted conservative groups for special scrutiny in their applications for tax-exempt status.
    Last edited by HAPPY2BME; 09-12-2013 at 12:55 PM.
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    Senior Member HAPPY2BME's Avatar
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    Senior Member HAPPY2BME's Avatar
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    Will lawmakers act to close tax loophole for illegal immigrants?

    Posted: Apr 27, 2012 10:20 PM CDT Updated: Apr 30, 2012 9:03 AM CDT By Bob Segall

    From Indiana to Capitol Hill, thousands of people are now weighing in on a WTHR investigation exposing a tax loophole worth billions for undocumented workers. But what, if anything, can be done about it?
    Note: This is part two in a two-part series. Read part one here.

    INDIANAPOLIS - Congressman Dan Burton (R – Ind) is frustrated – very frustrated – after learning the details of an Eyewitness News investigation.

    "Why in the world are we doing this?" he asked. "Are you kidding me? The cost to the American tax payer is huge!"

    The veteran lawmaker is responding to what 13 Investigates discovered all across Indiana: illegal immigrants getting big tax refunds from the Internal Revenue Service thanks to a loophole in federal law.

    MORE: Tax loophole costs billions

    The loophole allows undocumented workers to collect what's called an additional child tax credit. The credit – up to $1,000 per child – can be claimed even by families who pay nothing in taxes, in many cases resulting in a cash payment from the IRS. It is intended for working families with children who live in the same home.

    But a local tax preparer came to Eyewitness News to blow the whistle on millions of people who, he believes, are taking advantage of the system. He says many illegal immigrants are claiming the tax credit for children who've never lived in this country, and he showed 13 Investigates dozens of redacted tax returns to prove his point.
    "There is not a doubt in my mind there is huge fraud taking place here," said the whistleblower, who asked not to be identified for fear of reprisal. "I can bring out stacks and stacks. It's just so easy it's ridiculous."

    Exposing the loophole

    An undocumented worker in southern Indiana told 13 Investigates just how easy it truly is.
    He said four other illegal immigrants file tax returns using his address, even though none of them actually lives there. And he said this year, those four workers filed tax returns claiming 20 children live inside his small trailer home. As a result, the IRS sent the illegal immigrants tax refunds totaling more than $29,000.
    But none of the 20 children listed as dependents on the tax returns lives in Indiana – or even in the United States.

    "No, they don't live here," admitted the undocumented worker, who lives with his young daughter. "The other kids are in their country of origin, which is Mexico."

    The IRS granted tax credits for the 20 children anyway, even though the agency's own policy states they are not eligible. (Children are eligible for additional child tax credits only if they are US citizens or minor resident aliens who live in the US with a tax filer for more than half of a calendar year.)

    According to WTHR's whistleblower, cases like this one are commonplace because the IRS does little to verify the eligibility of both the undocumented workers filing for additional child tax credits and the dependents listed on their tax returns.

    13 Investigates has confirmed it's a growing problem. It's nationwide. And it's out of control.

    Billions already paid

    Eyewitness News obtained US Treasury Department audit reports that show illegal immigrants now get additional child tax credits totaling $4.2 billion dollars each year. The department's Inspector General for Tax Administration has repeatedly warned the IRS that undocumented workers are abusing the additional child tax credit.

    "Millions of people are seeking this credit who, we believe, are not entitled to it," said inspector general Russell George. "We have made recommendations to [IRS] as to how they could address this and they have not taken sufficient action in our view to solve the problem. It's very troubling."

    Why has the IRS done nothing?

    Despite phone calls, emails, even a visit to IRS headquarters in Washington to get answers, no one at the IRS would meet with WTHR.

    The agency instead sent 13 Investigates a short statement (see below) saying it is following the law, and current tax law does not prevent undocumented workers from getting additional child tax credits. The IRS claims it can't change that without a new law.

    Rep. Burton and other lawmakers are now ready to act.

    Lawmakers looking for a fix

    "We've got to deal with it," he said. "I knew this was a problem, but until hearing what you found, I didn't know it was this severe."

    Rep. Burton and dozens of other House Republicans have co-sponsored a bill that would essentially authorize additional child tax credits only for US citizens. House Resolution 1956 would require tax filers to provide a valid social security number to receive an additional child tax credit.

    The IRS provides illegal immigrants with an ITIN (individual taxpayer identification number) so they can file tax returns, but most undocumented workers are not eligible to receive a social security number.

    HR 1956 has sat idle in the House Ways and Means Committee for almost a year.

    However, language from the bill is now included in a package of proposed budget savings measures that House lawmakers are expected to consider in May. While the budget package may have enough support to pass the House, it is expected to die a quick death in the Democratic-controlled Senate.
    "This should not be a partisan issue because we're all concerned about saving taxpayer dollars and not wasting them on fraudulent things like this," said Rep. Burton. "But I don't think Democrats want to deal with this with right now."
    Not all Democrats are opposed to limiting additional child tax credits to US citizens.

    Last fall, Senator Claire McCaskill (D – Mo) sent a letter to IRS Commissioner Douglas Shulman asking him to stop the agency's payments of additional child tax credits to undocumented workers. "This is deeply problematic and must be remedied," the senator wrote.

    But few other Democratic lawmakers have voiced support for eliminating the child tax credits for undocumented workers.

    Republicans plan to keep pushing the issue forward.

    "This rampant abuse of hardworking taxpayer dollars is just wrong," said Rep. Sam Johnson (R – Tex), who authored HR 1956. "It's time we close this tax loophole and put a stop to the child tax credit sham."
    Rep. Burton agrees.

    "I'm a taxpayer, and the thought of me paying for 24 people who are living in one trailer boggles my mind, especially when you tell me most of them are still living in Mexico. That's unconscionable." he said.

    "Who's going to help?"

    Many undocumented workers see the issue very differently.

    "It's not taking advantage. I'm very thankful to this country for the help it gives me," said an illegal immigrant in central Indiana, who decided to talk with 13 Investigates as long as we agreed not to reveal his identity.

    The worker has lived in the United States for 14 years. He owns a home in Indiana, pays taxes and is raising three children who are all honor roll students. This year, he received a $9,000 tax refund that includes additional child tax credits – not only for his children who live in Indiana, but also for four nieces and nephews in Mexico.
    The tax credits help him care for his young family members south of the border, and he says attempts by Congress to revoke the credits could have dire consequences.

    "Who's going to help them if they're not eligible ... to avoid them ending up in the drug mafia, begging in the street, being raped? What happens when they get sick?" he asked. "There's a lot of things that could happen to them if you don't help … When you come here [to the United States], to your family down there, you are their hope."

    Taking additional child tax credits away from undocumented workers would also have an impact on millions of children legally living in this country. Children of illegal immigrants who are born in the US are legal US citizens and, in many cases, those children would no longer be eligible to receive the tax credits under proposals like HR 1956.

    But the inspector general insists refundable tax credits were never intended for illegal immigrants – let alone people who've never stepped foot in the United States.
    "It's being abused by people who are not entitled to use it, and that's problematic," George told Eyewitness News.
    "It's cheating the American taxpayer," agreed Burton. "We all believe in humanity and humanitarianism, but we've got a $15 trillion national debt. We can't subsidize the whole world."

    What can you do?

    Congress may be voting on a budget measure in the coming weeks, and a budget reconciliation package now being considered in the House of Representatives contains language that would limit additional child tax credits to US citizens with a valid social security number. If you feel strongly about this issue – one way or another – now is a good time to let your lawmakers know. Their contact information is listed below:

    US Representatives – Indiana
    1 Visclosky, Peter D 202-225-2461
    2 Donnelly, Joe D 202-225-3915
    3 Stutzman, Marlin R 202-225-4436
    4 Rokita, Todd R 202-225-5037
    5 Burton, Dan R 202-225-2276
    6 Pence, Mike R 202-225-3021
    7 Carson, André D 202-225-4011
    8 Bucshon, Larry R 202-225-4636
    9 Young, Todd R 202-225-5315

    US Senate – Indiana
    Daniel Coats (R)
    493 Russell Senate Office Building
    Washington, DC 20510
    (202) 224-5623

    Richard Lugar (R)
    306 Hart Senate Office Building
    Washington, DC 20510
    (202) 224-4814

    US Representatives – All states
    Contact Information
    US Senate – All States
    Contact Information

    Full statement to WTHR from the Internal Revenue Service:

    The law has been clear for over a decade that eligibility for these credits does not depend on work authorization status or the type of taxpayer identification number used. Any suggestion that the IRS shouldn't be paying out these credits under current law to ITIN holders is simply incorrect. The IRS administers the law impartially and applies it as it is written. If the law were changed, the IRS would change its programs accordingly.

    The IRS disagrees with TIGTA's recommendation on requiring additional documentation to verify child credit claims. As TIGTA acknowledges in this report, the IRS does not currently have the legal authority to verify and disallow the Child Tax Credit and the Additional Child Tax Credit during return processing simply because of the lack of documentation.

    The IRS has procedures in place specifically for the evaluation of questionable credit claims early in the processing stream and prior to issuance of a refund. The IRS continues to work to refine and improve our processes.

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  4. #4
    Senior Member HAPPY2BME's Avatar
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