Audit: IRS Acted Properly In Probing Nonprofits

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The Internal Revenue Service did nothing improper in investigating inappropriate political activity by certain charity groups, although timing the probes so close to the presidential election looked suspicious, a new report says.

An external audit randomly selected 40 of the churches, civic groups or charities that were investigated and found that their activities could be characterized as favoring Republicans in 18 cases, Democrats in 12 cases and the Green Party in one case, the Associated Press reported. The other nine cases could not be categorized or focused on local issues or candidates.

However, the Treasury Department's inspector general for tax administration said the IRS committee formed to check out improper political activity did not act until close to the election, which made it look as if the committee was politically motivated. The panel was chosen in June, but did not contact its first group until Sept. 21, six weeks before the presidential election.

The National Association for the Advancement of Colored People (NAACP), for example, announced in October that its tax-exempt status was being reviewed after its chairman made a speech criticizing President Bush.

"We believe contacting organizations so close to the election and the late publicity about this project contributed to the allegations of improper motivation on the part of the IRS," the auditors said.

Their report dealt only with whether the IRS acted properly and did not evaluate whether the groups violated the rules that bar them from campaigning for political candidates.

"I think timing is a critical issue in this process, especially when we're talking about the right to speak freely," said Angela Ciccolo, the NAACP's interim general counsel. "The IRS itself even agrees many corrective actions need to be taken."

IRS Commission Mark Everson said, "This report confirms what we've said all along. Political considerations played absolutely no part in the inquiries we launched last summer."

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