The IRS has taken "significant actions" to stop agents from targeting political groups based on their names and policy positions, according to a report issued Thursday by the government watchdog who disclosed the inappropriate activity two years ago.
The agency's inspector general says the IRS is doing a better job processing applications for tax-exempt status. His report said the IRS has eliminated intrusive, unnecessary questions, and has cleared a backlog of applications that had languished for months and years.
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The report is a follow-up to the inspector general's 2013 audit, which said agents had inappropriately singled out tea party and other conservative groups for extra scrutiny when they applied for tax-exempt status during the 2010 and 2012 elections.
The 2013 audit blamed poor management. It ignited a firestorm that led to numerous investigations and the replacement of much of the agency's top management.
"The IRS has taken significant actions in response to the recommendations made in" the 2013 report, said J. Russell George, the Treasury inspector general for tax administration.
The 2013 audit found that agents were singling out groups with "tea party" or "patriot" in the name. They also singled out groups that talked about "limiting/expanding government, educating on the Constitution and Bill of Rights, social economic reform/movement," the audit said.
These terms appeared on "be on the lookout" lists that agents used when scrutinizing applications for tax-exempt status under section 501 (c) (4) of the federal tax code, which is for social welfare groups.
George says the IRS no longer uses these lists.
The IRS issued a statement saying it appreciates the inspector general's "acknowledgement of the significant actions we took" to address the recommendations in the 2013 audit.
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