from – Center for Individual Freedom – by Ashton Ellis
Private lawsuits against the IRS are nothing new, but one claim against the tax-gathering agency should interest House Republicans investigating the possible willful destruction of evidence by former manager Lois Lerner and other employees.
According to federal court documents, the IRS “wiped clean a number of computer hard drives containing emails and other electronic documents that the Government was required to produce.”
Not surprisingly, the information scrubbed supported several arguments by a private company suing to recover nearly $550 million that the IRS improperly collected.
The recent assertion was made by attorneys for NetJets, a subsidiary of Berkshire Hathaway, whose legal wrangling with the IRS began in 2011.
Though not connected to the conservative non-profit targeting scandal, the NetJets lawsuit shares a striking – and troubling – similarity.
In both cases, the IRS is accused of losing evidence that would materially affect the outcomes of a conflict.
The NetJets dispute hinges on whether the IRS followed the law when the latter levied a $218 million tax on the company’s clients. NetJets – a firm that sells fractional shares in private jets – claims the tax is improper because it only applies to commercial airline passengers. NetJets is also seeking a $330 million tax abatement.
To recall, the IRS targeting scandal centers on alleged discrimination by officials of the agency’s tax-exempt division who used words like “tea party” and “patriot” to select applications for extra scrutiny. The result was a much longer wait time for approval, effectively sidelining otherwise legal organizations from speaking during the 2012 presidential election.
Lois Lerner, the then-chief of the IRS tax-exempt unit, quickly became the face of the scandal. Along with joining now-departing U.S. Attorney General Eric Holder as one of two members of the Obama administration to be cited for Contempt of Congress, Lerner refused to answer questions about her involvement.
After Lerner took an early retirement, the scandal plunged to new depths when IRS officials said that Lerner’s computer hard drive crashed, taking potentially thousands of incriminating emails with it. More recently, the agency has admitted that it also can’t find other emails related to the targeting program.
House Republicans smell a rat.
“The supposed loss of Lerner’s emails further blows a hole in the credibility of claims that the IRS is complying with congressional requests and their repeated assurances that they’re working to get to the truth,” said Darrell Issa (R-CA), House Oversight and Government Reform Committee Chairman. “If there wasn’t nefarious conduct that went much higher than Lois Lerner in the IRS targeting scandal, why are they playing these games?”
Though the NetJets and conservative targeting scandal don’t involve the same IRS units or personnel, it is deeply troubling that the same agency is being accused by federal investigators and private litigants of withholding information it is legally obligated to hand over.
Taken together, this pattern of results indicates a culture of corruption at the IRS that seeks to avoid blame by hiding the facts. The operating principle seems to be: When in doubt, wipe it out.
Combine these cases with the IRS decision to rewrite ObamaCare’s subsidy regime without any textual authority from the law itself, and what emerges is the picture of a federal agency willfully disregarding the rule of law.
“That the power to tax involves the power to destroy… [is] not to be denied,” wrote Chief Justice John Marshall in McCulloch v. Maryland.
In McCulloch, Marshall relied in part on that reasoning to strike down a state law to tax a federal agency. Today, Congress and the federal courts should consider reining in the IRS before it destroys the rights of the citizens it ostensibly serves.