Justice Department Settles Tea Party Lawsuits Over IRS Scrutiny

(CN) – The Justice Department on Thursday said it has reached settlements with several conservative groups over lawsuits related to the Internal Revenue Service’s scrutiny of the organization’s applications for tax-exempt status.

The settlements are in two cases. The first case, Linchpins of Liberty v. United States, comprised claims brought by 41 plaintiffs, and the second case, NorCal Tea Party Patriots v. Internal Revenue Service, was a class action suit that included 428 members.

Both settlements await the approval of the federal judges presiding over the cases — U.S. District Judge Reggie Walton in the former; U.S. District Judge Michael Barrett in the latter.

In a statement, Attorney General Jeff Sessions took aim at the Obama administration, saying that it was on the former president’s watch that “the IRS began using inappropriate criteria to screen applications for 501(c) status.”

“These criteria included names such as ‘Tea Party,’ ‘Patriots,” or ‘9/12’ or policy positions concerning government spending or taxes, education of the public to ‘make America a better place to live,’ or statements criticizing how the country was being run. It is also clear these criteria disproportionately impacted conservative groups,” the attorney general said.

“There is no excuse for this conduct. Hundreds of organizations were affected by these actions, and they deserve an apology from the IRS. We hope that today’s settlement makes clear that this abuse of power will not be tolerated,” Sessions added.

A report released by the Treasury Inspector General for Tax Administration in 2013 concluded the IRS had subjected Tea Party groups’ applications for tax-exempt status to extra scrutiny and delays.

Earlier this month the Treasury Inspector General released a second report that said some liberal groups’ applications also faced heightened scrutiny by the IRS.

The Oct. 5 report identified 146 cases of left-leaning groups being targeted for additional scrutiny because of suspicions that they were engaging in prohibited political activity.

Eighty-three of those groups were chosen because of the IRS’s selection criteria, which included groups referencing terms like “Occupy,” “Medical Marijuana” and “Progressive,” as well as any affiliation with the Association of Community Organizations for Reform Now.

The agency has since said that it’ is committed to “avoiding any selection and/or further review of tax-exempt applicants or entities that is based solely on the name or policy positions of such entity.”

The consent orders ask the court to declare the IRS violated the groups’ First Amendment rights, issue an order that the agency apply its rules in an evenhanded manner when considering applications for tax exempt status, and to declare “that it is wrong to apply the United States tax laws, including any and all tax rules, regulations, policies, procedures, and standards of review, to any tax-exempt applicant or entity based solely on such entity’s name, any lawful positions it espouses on any issues, or its associations or perceived associations with a particular political movement, position, or viewpoint.”


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