House Republicans Seek Impeachment of IRS Commish

Two days ago the Justice Department formally closed its investigation of alleged targeting of conservative groups by the Internal Revenue Service. DOJ found that Lois Lerner and other top IRS managers were guilty of “mismanagement, poor judgment, and institutional inertia,” but had done nothing criminal. This scandal began in 2013 and has been a hot topic in tax professional circles and among anyone interested in government & politics. Over the course of these past two and a half years, the IRS has been investigated by TIGTA, the Justice Department, and even the FBI. Some IRS officials involved in the scandal have resigned under the pressure. Even so, the DOJ stated that there was no evidence that any IRS official obstructed justice or attempted to obstruct justice. Big win for the IRS.

But GOP lawmakers don’t want to put this scandal to rest until justice has been served. Their target is IRS Commissioner, John Koskinen, and they’re not interested in settling with contempt or obstruction charges; they want to impeach him. Rep. Jason Chaffetz (R-Utah) and 18 other republicans have initiated the seldom-used impeachment process against Commissioner John Koskinen, which will go through the House Judiciary Committee next. Those who support impeachment of Koskinen claim that he has violated the public trust by lying about the existence of emails, or deleting emails, or allowing emails to be deleted on his watch, or any combination of these things. The IRS, of course, insists that it has fully cooperated with any and all investigations, spending upwards of $20 million and 160,000 employee hours in the process.

Interesting footnote: pursuing impeachment against an agency official is rare. Back in 1876 Congress tried to impeach War Secretary, William Belknap, but he resigned before conclusion of the process. Belknap, known as a man of virtues and flaws, was secretary to President Grant, and an attorney by trade. He went back to that trade after it was discovered that he had been involved in bribes and in selling weapons to France.

Commissioner Koskinen Asked to Resign

IRS Commissioner, John Koskinen, has been on the job for only a couple years, but he was brought in at a very difficult time for the agency. He was appointed by Pres. Obama and given the task of cleaning things up at the IRS, particularly in regard to the scandal involving targeting of Tea Party groups. Now he has lawmakers calling for his resignation because of the way he has handled the debacle. I bet there are days he regrets accepting the assignment.

The most outspoken republicans insist that Koskinen lied about the missing emails. Jason Chaffetz (R-Utah) is on record saying that Koskinen was in possession of the emails, and then after they were subpoenaed, his agency destroyed them. Many now want him to resign, and if he doesn’t, they are threatening worse. They are throwing around words like “contempt,” “obstruction of justice,” and “impeachment.”

President Obama claims that there was “not even a smidgen of corruption” within the IRS, but everybody knows this isn’t true. He needs to be a little more careful with his words. The IRS is huge and people are imperfect, arrogant, and greedy. How can he say there isn’t a smidgen of corruption? He doesn’t know that. All that really means is he has had meetings with those that run the agency who say there’s no corruption, who have had meetings with high level management who say there’s no corruption, who have had meetings with lower level management, etc. There is no way any clear-thinking adult could swallow such a broad statement as that.

According to Chaffetz, there are still at least 5 open investigations into the targeting scandal, including that of TIGTA and the Department of Justice. I, for one, must admit that I am a little surprised that the news of this scandal hasn’t fizzled yet. I think it speaks to how passionate we are, as US citizens, about allegations of corruption within our government.

IRS: The Raiders of Government Agencies

Usually when people are dressed in black surrounding a hole in a solemn ceremony, its a funeral.  But Tony Sparano, the interim head coach of the 0-4 Oakland Raiders, gathered the team for a special symbolic football burial this week.  He said that the football represented the first four games of the season.  The hope is that this little exercise will help the team to put it all behind them and move forward with a clean slate.

Maybe the IRS Commissioner, John Koskinen, should do something like this with his team.  I’m not sure what item(s) could be used to represent the past few years of missteps at the IRS, but to really drive the point home he would need to dig a hole the size of the Grand Canyon.  Actually, come to think of it, maybe they already did this exercise using Lois Lerner’s hard drive.  Nobody would ever consider that the IRS actually physically buried her emails in the ground.

Oakland Raiders vs. Internal Revenue Service.  Obviously the comparisons are unlimited given the fact that a Raider is actually a pirate, and a pirate is known for forcefully taking one’s hard-earned booty.  But I’ll leave this to your own imagination.

IRS Doesn’t Hire 20-year-olds Because They’re Used to Stuff that Works

One of the most hilarious things for IT people is to hear non-IT people try to talk about computers and technology.  By no stretch of the imagination am I an IT person, but I do see the humor in that sort of thing as well.  Here is 75-year-old John Koskinen in a recent interview with Tax Analysts’ William Hoffman:

[W]e have a huge turnover in people under 30 because we’re not hiring that many. But when we’re hiring them, we’re obviously not keeping them at the rate that we would like….Part of that is because our technology is so abysmal. You take people, young people coming in at 23, 25, 27, and they’re used to….stuff that works. You know, they’re at the high end and they Twitter and they do all of that stuff. When you come into an organization still moving people onto Windows 7 from Windows XP, that’s not exactly a cutting-edge technological group….Now, on the other hand, we’ve proved technological, technology people because we are doing great things. We don’t have enough resources, and we’re way behind what we’d like to do. But, you know, the apps we’re doing — Where’s My Refund, Get Transcript, and that — so we’re pushing various state-of-the-art stuff, which is why I refer to our IT as a Model T with a great GPS and wonderful sound system….And so that’s some extent, so we’ve got some state-of-the-art apps and, you know, really ancient — you know the average age of our IT equipment is 15 years. So we have to be the only serious large organization of a financial institution running with average equipment age of 15 years. So our computers are too old, our servers are too old. You know, we still got stuff in COBOL programming….So that’s the problem at the front end.

I’m not 27 any more and I feel like I am used to stuff that works too.  It would absolutely drive me crazy to work with 15-year-old computer equipment.  I couldn’t work there for 1,000 other reasons, but that would be a big one.

This quote is so full of awesome lines I don’t even know where to start.  My favorite line: “You know, they’re at the high end and they Twitter and they do all of that stuff.”  It is funny to me that the head guy at the IRS says things like this.  I mean, it’s fine, we don’t need a spry young kid at the high end who Twitters or anything.  As long as he can manager other high end people who Twitter, things should be fine.  The IRS definitely has proved technology people and they’re doing apps and pushing various state-of-the-art stuff.  Oh boy, don’t even get me started on the IRS apps, Mr. Koskinen.  They aren’t that good.  After all, it doesn’t make much sense to put a GPS in a Model T if the Model T can’t go 99.99% of the places shown on the GPS.

Lost Lerner Emails May Still Turn Up

Over the past several weeks, top IRS officials have maintained the position that the Lois Lerner emails were destroyed and cannot be recovered.  But recent testimony to Congress suggests otherwise.  Just as everyone on earth suspected, the emails may still exist in some sort of backup storage device or system.  After all, even the IRS knows that technology fails and you have to back things up.

I don’t know if there is a backup tape with information on it or there isn’t…There is an issue as to whether or not there is a — that all of the backup recovery tapes were destroyed on the six-month retention schedule.

~ Thomas Kane, IRS Deputy Associate Chief Counsel

One of these “top IRS officials” is John Kos-freakin-kinen; he is the COMMISSIONER of the IRS, the highest guy on the totem pole, the captain of the ship.  Oh, and he happens to also be an ATTORNEY.  Lawyers know (every single one of them, especially cum laude Yale-educated lawyers like Koskinen) that when you’re being questioned and you don’t know the answer to the question, then your answer has to be “I don’t know.”  We lecture our clients about this before every deposition and hearing: “Don’t make up answers, and don’t guess.  If you don’t know the answer, it’s fine, just say you don’t know.” It often takes courage, and sometimes a little humility, to admit you don’t know something, especially if you’re in a position where you really should know.

Well, apparently Koskinen said the emails didn’t exist before he had confirmation of such and now his credibility is being questioned.

And isn’t this what it’s all about — the credibility of the IRS and its people?  Every single IRS scandal buries the IRS deeper in a pile of suspicion and mistrust.  How does the IRS expect taxpayers to voluntarily comply with tax laws if the agency is being run by so many incompetent leaders?  Now I know that somebody in a position like Koskinen’s often relies on the expertise and knowledge of a staff and couldn’t possibly have first-hand knowledge of everything going on within the agency.  But it seems to me that he should have at least waited for confirmation before declaring the emails unrecoverable.

Koskinen's Press Club Speech

The IRS Commissioner typically speaks at a National Press Club luncheon once a year.  It is the perfect venue to learn about the Commissioner, his vision, and everything at the top of his to-do list.  Here are a few things that stood out to me from Koskinen’s Press Club remarks from April 2nd, 2014:

  • He enjoys college basketball, . . . or at least March Madness, . . . or at least Duke.  He made a pretty funny joke about Duke’s loss in the early rounds of the NCAA championship.
  • During the three months he has been serving as head of the IRS, he has visited 18 of the 25 largest IRS offices.  He has jumped right in and run around quite a bit for an old guy.
  • He likes to hear the opinions of the minions.  I really do respect this approach and hope that it is more than just words and becomes part of the culture at the IRS.
  • He is realistic; he does not pretend to be perfect and he doesn’t expect IRS employees to be perfect either. In fact, he said that his theory is “bad news is good news,” meaning that even negative reports have a silver lining because at least it signifies that the news is getting reported.  After all, a problem cannot be corrected unless and until it has been identified.  I see his point, but I’m not sure I would have taken it that far.
  • He is big on the whole idea of restoration of public trust and the notion that every taxpayer should be treated fairly.  He spent a large portion of his talk discussing the investigations into the IRS’ tax exempt application scandal.
  • He wraps up by commenting on the tax filing season, problems with voluntary compliance and tax fraud, FACTA, customer service (by phone and at local service centers), tax reform, and administration of applicable provisions of the Affordable Care Act.
  • The biggest problem, according to the Commissioner, is insufficient funding.  He basically needs another billion dollars, give or take.

Koskinen's YouTube Debut as Commissioner

New Internal Revenue Service Commissioner, John Koskinen, delivered a special message to the nation via the IRS YouTube channel.  For many this is a video of first impressions.

On a side note, I’m not sure what the point of these videos is because regular taxpayers don’t watch them and those people that do watch (tax attorneys, CPAs, enrolled agents, and general tax professionals) don’t really benefit, as these videos normally consist of a series of ambiguous soundbites.

Koskinen’s message falls in line with other IRS videos: positive and hopeful, but lacking any kind of substance.  Here are the main points:

  • He got right to work after being appointed to his new position
  • He has been traveling around the nation taking the pulse of the IRS
  • The IRS is here to help taxpayers during 2014 tax season
  • Refunds will be issued quickly
  • The IRS will work to reduce tax fraud and ID theft
  • Over 120 million people filed their tax return electronically last year
  • Resources are limited & there will be long wait times if you try to call
  • Quicker way to get help: irs.gov, tax software, tax professionals, IRS YouTube channel, IRS2Go smartphone app

As the new Commissioner of the IRS, I want to be up front with you and call it like it is, just as I have been doing my entire career.

~ John Koskinen, IRS Commissioner

My mom always told me to be skeptical of phrases that are prefaced with “I’m gonna be honest with you,” but whatever.  On the other hand, Koskinen was sufficiently stiff, boring, and unhappy in this video to convince me that he’s the right guy for the job.  He’s going to fit in just fine at the IRS.

Obama Nominates John Koskinen as New IRS Commissioner

The IRS has been without a permanent leader for some time now.  Acting Commissioner, Steven Miller, had replaced Douglas Shulman when his term came to an end in November 2012.  Then, when President Obama fired Miller in May of this year, the agency was being led by Danny Werfel, a White House budged official.

Today the White House announced the nomination of John Koskinen as the new IRS Commissioner.  Obama’s nomination is likely going to be approved by the Senate following their standard and very thorough hearings.  Obama likes Koskinen because he has vast experience helping large companies on the verge of collapse and fixing bad management and bad morale.

With decades of experience, in both the private and public sectors, John knows how to lead in difficult times, whether that means ensuring new management or implementing new checks and balances. Every part of our government must operate with absolute integrity and that is especially true for the IRS. I am confident that John will do whatever it takes to restore the public’s trust in the agency.

~ President Obama

74-year-old Koskinen has quite the resume and has often been called on to rescue organizations in crisis.  Here is some of his work experience:

  • Freddie Mac
  • Mutual Benefit Life
  • Penn Central Transportation Company
  • city administrator for District of Columbia
  •  president of the United States Soccer Foundation
  • US Office of Management and Budget
  • chair of the President’s Council on Year 2000 Conversion
  • executive board-member of AES Corp. and American Capital, Ltd
  • National Advisory Commission on Civil Disorders

So, Koskinen is certainly an old guy, but maybe the IRS needs more maturity in its leadership.  It is probably safe to say that he wouldn’t approve of Star Trek videos.

It will be interesting to see how Koskinen handles the task of cleaning up the IRS.  Will he fire a bunch of executives?  Will he try to clone himself by hiring like-minded replacements?  Or will it be enough to simply put the fear of God in the existing leadership?  I’m sure we will eventually get to know his leadership style, but for now we should be content knowing that the man gets results.