If the IRS and Treasury Department keep stonewalling Republican investigators about misdeeds and threats of tax surveillance, things could and should get ugly for the administrators.
If Republicans take control of Congress in next week’s elections, the new majority will have more power to make those officials comply. And in the event that they continue to resist oversight, the new majority can proclaim the officials to be in criminal contempt of Congress. Technically, the House can have its sergeant-at-arms arrest and even imprison the person found in contempt, but usually, the case is referred to the Justice Department for prosecution.
THE IRS HAS A LONG HISTORY OF CORRUPTION AND INCOMPETENCE
The stonewalling on three different issues has catalyzed separate letters on each subject from committee Republicans, two to Treasury Secretary Janet Yellen and one to IRS Commissioner Charles Rettig. On all three, the Republicans are acting for good cause, on behalf of aggrieved taxpayers.
The first letter, dated Oct. 20, demands that Rettig reply by Nov. 3 to confirm that he will “preserve all documents and communications in your custody” about, and produce the “decision memorandum” explaining, the IRS’s 2021 destruction of some “30 million unprocessed, paper-filed informational returns.” The IRS so far has refused to hand over its decision memorandum explaining why it can get away with deliberately destroying documents that it would punish taxpayers for failing to file. Committee Democrats so far have blocked a “Resolution of Inquiry” that would direct the IRS to comply with the demand for transparency.
The next two letters, both dated Oct. 27 and sent to Yellen, request replies by Nov. 10. The first asks for assurance that the outlandish $80 billion in new funding Democrats are providing the IRS will not be used to revive a “bank surveillance scheme” President Joe Biden proposed in 2021 but that never was approved by Congress. The actual words of Biden’s proposal say it “would create a comprehensive financial account information reporting regime” that “would apply to all business and person accounts from financial institutions” except accounts worth less than $600.
As the $80 billion, along with 87,000 new IRS workers, would be largely used for “enforcement,” Republicans want assurances that the money and new agents won’t be used to accomplish through “executive action” what Biden was not able to achieve through legislation. Republicans here have a good point. What Biden proposed would have been a frightening government invasion into the personal financial habits of ordinary people.
The second letter to Yellen demands “commitments to Congress and the American people” that the Treasury Department set “a reasonable deadline” for, and eventually “create a report to Congress” on, an investigation into a “massive leak of private taxpayer information” to the ProPublica progressive “news” organization. Since receiving the leaked materials, ProPublica has repeatedly published confidential information, stretching back 15 years, “about numerous American taxpayers.” As the Wall Street Journal noted, “the leak was a federal crime,” but for 16 months, the administration has provided no significant information to Congress about how the leak occurred or what is being done about it.
As the IRS has a long history of abusing innocent taxpayers, committee Republicans suspect that the leak of data was intentional and politically motivated.
“It is essential that this matter is not swept under the rug,” wrote three top Republicans, led by ranking member Kevin Brady (R-TX). “Congress and the American people deserve to know what happened and who is responsible.”
If Treasury Department and IRS officials keep failing to comply, they deserve to face significant reprisals.
