Internal Revenue Service impartiality defended in row over audits of top FBI officials fired under Trump

By on 19/07/2022 | Updated on 20/07/2022
The Internal Revenue Service (IRS) federal building at 1111 Constitution Avenue Northwest, in Washington D.C.
The Internal Revenue Service building in Washington D.C. Photo by Tony Webster via Flickr

Internal Revenue Service employees are likely to have acted properly when they performed in-depth tax audits on two former FBI leaders demonised by former president Donald Trump, the Professional Managers Association (PMA) has said.

The New York Times revealed earlier this month that James B. Comey, former FBI director and his deputy Andrew G. McCabe, had been selected for the most invasive audit carried out by the IRS on their 2017 and 2019 tax returns respectively.

Comey was fired by Trump in 2017, who was angered by his pursuit of an investigation into Russia’s alleged interference in the 2016 federal election in which Trump was elected. McCabe was sacked by Trump’s Justice Department the following year after its watchdog accused him of misleading internal FBI investigators. Trump publicly lambasted both men after their dismissal, accusing them of treason and calling for their prosecution.

The revelation that both men were subject to the rare audits – known to tax lawyers as “an autopsy without the benefit of death” and which in 2017 for example was conducted on only around 5,000 of the 153 million individual tax returns filed that year – has led to accusations that IRS officials, who were under the leadership of a Trump appointee, were politically motivated.

“Lightning strikes, and that’s unusual, and that’s what it’s like being picked for one of these audits. The question is: Does lightning then strike again in the same area? …You don’t need to be an anti-Trumper to look at this and think it’s suspicious,” John A. Koskinen, the IRS commissioner from 2013 to 2017, told the New York Times.

‘Left between a rock and a hard place’

However, the PMA, a national membership association formed in 1981 by IRS managers representing the interests of officials across federal government, has defended IRS officials’ conduct. It said “it is not surprising” that Comey and McCabe’s tax returns were flagged by the IRS system – which works on the basis of statistical assessment – as anomalous because both men released successful books after their dismissal presumably leading to a significant increase in their income from one year to the next.

“Both individuals’ tax returns likely changed dramatically in a short period of time, making those returns appear unusual. It would be expected for the statistical assessment system to flag their returns for their local IRS field office,” Chad Hooper, the PMA’s executive director said.  

Hooper said once a tax return had be flagged “an IRS field manager has limited discretion to move forward with a research audit or remove a taxpayer from the sample”.

“When a field manager gets notified about a controversial political figure’s anomalous return, they have two choices: (1) conduct a research audit and face accusations of conducting a politically motivated audit; or (2) forgo conducting an audit and face accusations of going easy on political figures.

“The IRS manager is left between a rock and a hard place where either way there may be a perception of bias… one might argue the easiest route for a manager to take is to conduct the audit as the statistical assessment suggested.” 

Hooper said the PMA is “confident the vast majority of IRS employees uphold their oath to faithfully and impartially serve the American people”, adding that, if there was political interference or bias at play in the IRS research audits against Comey and McCabe, “we encourage the Service to take necessary action”. “[I]f there was improper political interference or bias, we are confident it will be brought to light,” Hooper said.

“Much is still unknown, and we caution lawmakers and the media not to undermine public trust in our tax system based on unfounded assumptions or partial information,” he said.  

The IRS is prohibited by law from discussing specific cases but said in a statement that IRS commissioner Charles P. Rettig – who was appointed by Trump in 2018 – had no role in selecting candidates for audit.

Several House representatives and oversight committee chairs and members have called for an investigation into the selection of Comey and McCabe for auditing.

Mark Everson, who served as IRS commissioner from 2003 to 2007 and is now vice chairman of a national tax consulting firm, told Government Executive he would be “stunned if the selection of these two individuals was anything other than random,” but that he thinks a review is needed to “clear the air”.

At the time of publishing, no such investigation had been announced.

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About Mia Hunt

Mia is a journalist and editor with a background in covering commercial property, having been market reports and supplements editor at trade title Property Week and deputy editor of Shopping Centre magazine, now known as Retail Destination. She has also undertaken freelance work for several publications including the preview magazine of international trade show, MAPIC, and TES Global (formerly the Times Educational Supplement) and has produced a white paper on energy efficiency in business for E.ON. Between 2014 and 2016, she was a member of the Revo Customer Experience Committee and an ACE Awards judge. Mia graduated from Kingston University with a first-class degree in journalism and was part of the team that produced The River newspaper, which won Publication of the Year at the Guardian Student Media Awards in 2010.

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