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White House Probed Over Claim on Conservative Group's Tax Status

Austan Goolsbee, of the White House Council of Economic Advisors, on "Face The Nation," March 22, 2009.
Austan Goolsbee, chair of the White House Council of Economic Advisers CBS

The Treasury Department is investigating whether the White House improperly accessed and discussed the private tax information of a corporation run by conservative political donors.

The investigation comes at the request of Republicans on the Senate Finance Committee, who wanted the department to find out why a senior administration official, identified as Council of Economic Advisers Chairman Austan Goolsbee, said on a conference call with reporters in August that Koch Industries does not pay corporate income tax.

In a letter first obtained by the conservative magazine the Weekly Standard, the inspector general for tax administration at the Treasury Department said he has ordered a review of the issue.

The inquiry stems from a conference call held in late August by the President's Economic Recovery Advisory Board (PERAB) to discuss a report the board was issuing about the U.S. tax system. In a transcript of the call obtained by the Weekly Standard, a senior administration official reportedly said: "So in this country we have partnerships, we have S corps, we have LLCs, we have a series of entities that do not pay corporate income tax. Some of which are really giant firms, you know Koch Industries is a multibillion dollar businesses."

A White House official said today: "The official's statement was not based on any review of tax filings, and we will not use this example in the future."

A White House official told CBS News White House correspondent Chip Reid that if indeed Goolsbee had "snooped" into Koch Industries' tax filings he would have known they did pay taxes, as the company has stated.

The Republican senators requested the investigation after Koch Industries questioned where the Obama administration obtained the company's tax status and suggested it was concerned about being singled out for its political views.

Around the same time as the conference call, Charles and David Koch were featured in a New Yorker article that highlighted their conservative donations and characterized them as "waging a war against Obama." Democrats have spotlighted donations from the Koch brothers in their arguments for campaign finance reform.

Stephanie Condon is a political reporter for You can read more of her posts here. Follow Hotsheet on Facebook and Twitter.
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