IRS chief: We should have done "better"

Days after the revelation that the Internal Revenue Service (IRS) targeted conservative groups for tougher scrutiny in their applications for tax-exempt status, acting IRS commissioner Steven Miller said Tuesday "mistakes were made" within the agency - but that the practice was "in no way due to any political or partisan motivation."

In an op-ed Tuesday in USA Today, Miller argued that the IRS targeted groups affiliated with the tea party because at the time, in 2010, there was a "sharp increase" in the number of applications coming from those types of organizations.

"We sought to centralize work in this area in 2010 because our office of Exempt Organizations observed a sharp increase in the number of section 501(c)(3) and 501(c)(4) applications coming from groups potentially engaged in political campaign intervention," Miller wrote. "Between 2010 and 2012, the number of applications for 501(c)(4) status more than doubled, from 1,591 to 3,398."

It was important for the IRS to carefully review those organizations' applications, Miller argued, because "the law limits and in some cases prohibits political intervention by exempt organizations." Still, he said, the "way we initially centralized" those cases for review "did not" make sense.

"The Internal Revenue Service recognizes that we should have done a better job of handling the influx of applications by advocacy organizations," he said. "We fixed the situation last year, and have made significant progress in moving the centralized cases through our system... The new procedures we have implemented ensure the mistakes we made won't be repeated."

CBS News has confirmed that Miller, who replaced former IRS commissioner Douglas Shulman who resigned last year, was informed of the IRS's targeting policy in May 2012. On July 25, 2012, Miller testified before a House Ways and Means Oversight subcommittee, but did not mention the agency's heightened scrutiny for the applications of conservative groups. After learning of the controversial IRS practice, he also wrote at least two letters to Congress explaining the process for reviewing tax-exempt status applications; in neither of those letters did he mention the targeting.

When asked during the July hearing about complaints of being "harassed" from politically active groups, Miller said the IRS "did group those organizations together to ensure consistency, to ensure quality," but did not state that they had been specifically targeted by political affiliation for higher scrutiny.

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