CLEVELAND, Ohio — Tea Party groups across the country — including three in Ohio — have settled a lawsuit they filed against the IRS that said the agency discriminated against the groups when it reviewed their applications for tax-exempt status during President Barack Obama’s administration.
A proposed consent order filed in federal court Wednesday includes a note of apology from the IRS for its employees’ conduct when looking at the applications. The settlement marks the end of years-long fight the right-leaning groups waged against the Obama administration; one that President Donald Trump’s Justice Department had to defend and eventually settle.
A judge still needs to sign off on the settlement.
“There is no excuse for this conduct. Hundreds of organizations were affected by these actions, and they deserve an apology from the IRS,” Attorney General Jeff Sessions said in a statement Thursday. “We hope that today’s settlement makes clear that this abuse of power will not be tolerated.”
A pair of lawsuits — one filed in Washington, D.C. and one in Cincinnati — grew out of a scandal that revealed that IRS agents singled out Tea Party supporters and other conservative groups for increased scrutiny when they applied for tax-exempt status.
Wednesday’s settlement resolved the D.C. case. It does not include a financial settlement.
The lawsuit in Cincinnati is pending, but lawyers for both sides said in a court filing Wednesday that they had resolved their case as well.
Portage County TEA Party Executive Director Tom Zawistowski, whose group was a plaintiff in the D.C. lawsuit and who said he is involved in the Cincinnati case, told cleveland.com Thursday that the Cincinnati lawsuit will be resolved with a financial settlement.
The IRS scandal began in 2010, when agency employees in Cincinnati gave extra scrutiny to tax exemption requests filed by a collection of conservative groups and Tea Party organizations. The Justice Department, a Treasury Department inspector general and several congressional committees investigated but found no criminal wrongdoing.
The scrutiny included long delays for the applications of Tea Party groups and making needless information requests as the applications were processed.
The revelation of the IRS’ conduct caused consternation with many Republicans. Lois Lerner, who was in charge of the division that reviewed applications for tax-exempt status, and others either resigned or retired in the wake of the scandal.
The settlement says the IRS will follow the recommendations made by the inspector general following an audit.
“The IRS admits that its treatment of Plaintiffs during the tax-exempt determinations process, including screening their applications based on their names or policy positions, subjecting those applications to heightened scrutiny and inordinate delays, and demanding of some Plaintiffs’ information that (the inspector general) determined was unnecessary to the agency’s determination of their tax-exempt status, was wrong,” the consent order states. “For such treatment, the IRS expresses its sincere apology.”
In addition to the Portage County TEA Party, the plaintiffs in the Washington, D.C. case include the Shelby County Liberty Group in Sidney and American Patriots Against Government Excess in Fremont.
Zawistowski said in a news release Thursday that “it has been a long and hard fight for justice. I, and the thousands of members of the Portage County TEA Party both past and present, are very gratified by the settlement agreed to today with the Internal Revenue Service.”
Some Republicans have also pushed for the Justice Department to re-open a criminal investigation into Lerner, but Sessions indicated in September that his department would not do so.
Champaign County GOP Rep. Jim Jordan, chairman the House Freedom Caucus, led an unsuccessful charge in Congress to impeach IRS Commissioner John Koskinen because of the IRS actions against the Tea Party groups.
The Associated Press contributed to this report.