First lawsuit filed against IRS
May 20th, 2013
07:32 PM ET
10 years ago

First lawsuit filed against IRS

Washington (CNN) – A Northern California tea party group filed the first lawsuit against the U.S. government stemming from the Internal Revenue Service targeting of conservative groups for more scrutiny as they applied for tax-exempt status.

"The IRS and its agents singled out groups like NorCal Tea Party Patriots for intensive and intrusive scrutiny, probing their members' associates, speech, activities and beliefs," the suit claimed on Monday.

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"NorCal and its members suffered years of delay and expense while awaiting the exemption and spending valuable time and money answering the IRS' questions. The result was a muffling and muzzling of free expression" the lawsuit claimed.

The group alleged violations under the Privacy Act as well as violations of its constitutional rights guaranteeing free expression and equal protection under the law.

It is asking for unspecified damages and named the IRS, Treasury Department and unnamed current and former IRS employees.

NorCal Tea Party Patriots first applied for the tax-exempt status in March of 2010 but it took more than two years to receive it.

The inspector general for the IRS found this month the agency developed and followed a faulty policy to determine whether applicants for tax-exempt status were engaged in political activities, which would disqualify them from receiving tax-exempt status.

The inspector general confirmed that agents from 2010 through early 2012 used inappropriate words, such as "tea party" and "patriots," and other criteria off and on to single out applications for more examination.

The watchdog who conducted the audit, J. Russell George, found the criteria resulted in substantial delays and the request of unnecessary information from the groups.

The lawsuit alleged that the "IRS engaged in a tactic of suffocating NorCal Tea Party Patriots and other similarly situated groups with requests that were so searching and extensive that they would have presented a serious challenge even for sophisticated businesses."

Group officials said the IRS asked for a wide variety of information. This included a list of all events and activities conducted since July 2010 and information about their website; Internet related activities; materials they distributed; information about their board of directors and the names of donors, contributors and grantors.

They were also asked if they conducted or would conduct rallies or exhibitions for or against public policies, legislation, public officers, political candidates, the officials said.

Mark Meckler, president of a Tea Party-aligned group Citizens for Self-Governance, helped bring the lawsuit and told CNN that he expects other groups to join.

Meckler and the president of the NorCal group will hold a news conference on Tuesday in Washington to talk about the case.

"When the federal government runs amok, it is up to us to reign it in. Neither party in Congress can be relied upon to satisfactorily resolve this issue. They created the IRS, fund the IRS, and oversee the IRS. All of this abuse happened on their watch," Meckler said in a press release.

The IRS did not respond to a request for comment regarding the lawsuit, which was filed in Cincinnati where the IRS office responsible for the tax-exempt determinations is located.

Acting IRS Commissioner Steven Miller answered questions before a House committee on Friday.

"I want to apologize on behalf of the Internal Revenue Service for the mistakes that we made and for the poor service we provided. The affected organizations and the American public deserve better," Miller told the Ways and Means Committee.

"I do not believe that partisanship motivated the people who engaged in the practices" described in the inspector general's report. "I think that what happened here was that foolish mistakes were made by people who were trying to be more efficient in their workload selection," he said.

IRS officials are expected to testify at congressional hearings on Tuesday and Wednesday.

Several other groups have said they plan to sue the IRS.

CNN Senior Producer Bill Mears contributed to this story.

Filed under: IRS • Tea Party
soundoff (38 Responses)
  1. waitaminute

    Let's Impeach Obama now and then tell him why later.

    May 21, 2013 03:45 am at 3:45 am |
  2. cynprice

    Apple doesn't want to pay U.S. Taxes, want's it's Workers in China to receive 28 cents an hour, and keeps it's $$$'s out of the U.S. Can I repeat, No U.S. Taxes, Worker's Overseas, $$$'s Overseas. And why are they allowed to even live in the U.S. Corporations used to be about doing something for our Country. Apple is Evil like Monsanto. Yes, I know, the Shareholders on Wall Street benefit. Even that's bull, its so the 1% in Apple get $25 million a year instead of $20 million, that's why the jobs are in china and they live here in the U.S. on that little sum/bonus

    May 21, 2013 04:12 am at 4:12 am |
  3. Donkey Party

    More GOP inspired charades. They weren't denied the exemption, the IRS was using proper diligence to weed out these phony groups. The Tea Baggers are in fact anti-tax and anti-government, they should have expected the additional scrutiny. Thanks IRS for doing your job.

    May 21, 2013 05:13 am at 5:13 am |
  4. why me

    i wouldn't mind this, but any money awarded will come out of the tax papers pockets. why should I pay the price for someone elses actions. find who did this and break their bank. the whole government didn't do this the IRS did this. How is going to punish those did this, but that's not the point. However did this could never afford to pay the loses back, so they hit the only source of deep pockets.

    May 21, 2013 05:36 am at 5:36 am |
  5. mattski

    You know what the irony is? Guess who ends up paying for these lawsuits. We do. But in this case, I'll gladly chip in.

    May 21, 2013 06:19 am at 6:19 am |
  6. Tampa Tim

    It takes a soldier 900 days to get VA help, and a wingnut group files a suit for a delay a mere two years? This is more tea bagger crap.

    May 21, 2013 06:23 am at 6:23 am |
  7. Marie MD

    Who is paying for the lawyers? I am sure the koch brothers have already opened their wallets.
    Another reason not to give these tea trolls any tax exemption of any kind. They are funded by multi millionaires to spread hate and stupid!

    May 21, 2013 06:44 am at 6:44 am |
  8. Say What?

    The lawsuit wont go anywhere. When you sign government forms, you wave your rights. Somebody is looking to be paid, and it wont be the taxpayers

    May 21, 2013 06:44 am at 6:44 am |
  9. John

    First, the IRS employees who scrutinized these applications were not agents. Agents actually conduct field audits of organizations, tax exempt and taxable, once the organizations have been in operation for at least several years. These employees are called Determination Specialists. Second, unless this tea party group can show that they were personally harassed rather than their applications scrutinized even with some questions which may not have been relevant, they're wasting their time and just trying to get attention. A district court judge will laugh this group out of the courtroom.

    May 21, 2013 06:53 am at 6:53 am |
  10. Name lynn

    How many laws suites will be file against the irs and how is the white leaders going to stop this. Its so wrong for the irs to cheat the people out of their money what going to happen next.

    May 21, 2013 06:57 am at 6:57 am |
  11. Timz

    Maybe the courts will do what the legislature can't and the administration won't

    May 21, 2013 07:13 am at 7:13 am |
  12. add

    How ironic that the very thing that the Tea party stands for (limited government) is what they become a victim of.

    The IRS is going to get their head handed on a plate.

    May 21, 2013 07:23 am at 7:23 am |
  13. Patrick

    How comforting to know that Obama relies on watching CNN with his coffee each morning to discover what's going on in his administration.

    May 21, 2013 07:47 am at 7:47 am |
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