IRS chief says screening was wider than first disclosed

WASHINGTON — The IRS screening of groups seeking tax-exempt status was broader and lasted longer than has been previously disclosed, the new head of the agency said Monday.

An internal document said that besides ‘‘Tea Party,’’ lists used by screeners to pick groups for close examination included the terms ‘‘Israel,’’ “Progressive,’’ and ‘‘Occupy.’’ The document said an investigation into why specific terms were used was still underway.

In a conference call with reporters, Danny Werfel said that after becoming acting chief of the Internal Revenue Service last month, he discovered wide-ranging and improper terms on the lists. He did not specify what terms were on the lists, but he said he suspended the use of all such lists immediately.


‘‘There was a wide-ranging set of categories and cases that spanned a broad spectrum’’ on the lists, Werfel said. He added that his aides found those lists contained ‘‘inappropriate criteria that was in use.’’

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Werfel’s comments suggest the IRS may have been targeting groups other than those in the Tea Party movement and other conservative organizations for tough examinations to see if they qualify.

His comments also indicate that the use of inappropriate terms lasted longer than had been revealed previously. A report last month by a Treasury Department inspector general said officials abolished targeting of conservative groups with those lists in May 2012.

Werfel said preliminary results of an examination he has conducted have so far found no indication of improper screening beyond the IRS offices that examines groups seeking tax-exempt status.

He said he believes there was ‘‘insufficient action’’ by IRS managers to prevent and disclose the problem, but has discovered no specific clues of misconduct.


‘‘We have not found evidence of intentional wrongdoing by anyone in the IRS or involvement in these matters by anyone outside the IRS,’’ he told reporters.

Werfel’s comments came as he released an 83-page report containing his assessments of the embattled agency and initial steps he is taking to make improvements.

The report describes several new procedures to prevent unfair treatment of taxpayers. They include a fast-track process for groups seeking tax-exempt status that have not gotten a response from the IRS within 120 days of applying.

In addition, the top five people in the agency responsible for the tax-exempt status of organizations have been removed, including the former acting commissioner, Steven Miller, whom President Obama replaced with Werfel.

‘‘The IRS is committed to correcting its mistakes, holding individuals accountable as appropriate’’ and establishing new controls to reduce future problems, Werfel said.


Werfel’s comments and report drew negative reviews from one of the IRS’s chief critics in Congress, Representative Darrell Issa, Republican of California and chairman of the House Oversight and Government Reform Committee.

Issa said the review ‘‘fails to meaningfully answer the largest outstanding questions about inappropriate inquiries and indefensible delays. As investigations by Congress and the Justice Department are still ongoing, Mr. Werfel’s assertion that he has found no evidence that anyone at the IRS intentionally did anything wrong can only be called premature.’’

The IRS has provided congressional committees with documents related to the screening problems. He said work was continuing on removing sensitive taxpayer information from those documents, and he said he expects them to be released soon.

Werfel had promised to produce a report within a month of taking over the agency.

Werfel said he briefed Obama and Treasury Secretary Jacob J. Lew on the report earlier Monday.

Werfel’s report indicated the agency had suspended the ‘‘be-on-the-lookout’’ watch list it had used to screen conservative and other groups and would allow applicants that had been waiting more than 120 days for approval to operate as a tax-exempt entity simply by certifying that they would not engage in excessive political activity in violation of tax law.

‘‘The problems . . . have created significant concerns for taxpayers,’’ Werfel said Monday. ‘‘It’s incumbent on us to take swift action.’’ He added that the IRS would continue to review what happened and take steps to ensure it does not reoccur.

‘‘I'm impatient, too, and I want to get to the bottom of this,’’ Werfel said.