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House delays limits on IRS

| Wednesday, Feb. 26, 2014, 8:09 p.m.

WASHINGTON — Fighting back against what they call unfair targeting of conservatives, House Republicans on Wednesday voted to delay efforts by the Obama administration to further restrict political activities of groups claiming tax-exempt status.

The GOP bill, approved 243-176, would delay for one year proposed Internal Revenue Service regulations developed in the aftermath of disclosures last year that the IRS had focused extra scrutiny on nonprofit groups — including those claiming a Tea Party connection — before the 2010 and 2012 elections.

The White House has said President Obama's top advisers will urge him to veto the bill if it reaches his desk, though majority Democrats in the Senate are expected to prevent it from getting a vote there.

The lack of clarity under the current standards “has resulted in confusion and difficulty administering the (tax) code, as well as delays in the processing of applications for tax-exempt status,” the White House said.

House Ways and Means Committee Chairman Dave Camp, R-Mich., said the new IRS rules were a blatant attempt “to legalize and institutionalize targeting” of Tea Party and similar groups. Civil liberty and environmental nonprofits have also objected to the proposed regulations.

The House bill would “put a hold” on the proposed rules until Congress and the Treasury Department's inspector general complete their investigations into the scandal, because of which the acting IRS commissioner and several fellow officials lost their jobs.

Meanwhile, Lois Lerner, the former IRS official at the center of the Tea Party controversy, will testify next week only in exchange for an immunity agreement, her lawyer told a congressional committee. Until then, Lerner will not answer questions unless ordered to do so by a federal judge, her attorney said.

The response from attorney William Taylor was given the day after the House Oversight and Government Reform Committee ordered Lerner to reappear at a hearing. When Lerner appeared before the committee in May, she asserted her Fifth Amendment right against self-incrimination.

Appearing before the committee last spring, Lerner made brief remarks denying any wrongdoing but then invoked a Fifth Amendment protection against self-incrimination to refuse answering any of the panel's questions.

Lerner retired from the IRS in September.

Lerner, the IRS's former director of Exempt Organizations, is the key figure in the controversy over how the agency treated conservative groups seeking tax exemptions. Lerner admitted at a legal conference last year that the agency improperly subjected groups to added scrutiny only because they had the words “Tea Party” or “patriots” in their names. She originally attributed the actions to low-level workers in Cincinnati, but those workers have since told congressional investigators they were acting on orders from Washington.

Taylor said he was “surprised” to receive the renewed summons, because he had been negotiating with committee staff as recently as Jan. 24 to provide Lerner's testimony. Lerner was even willing to provide a “proffer” — an off-the-record statement of what her testimony would be — as part of the immunity negotiations, he said.

Taylor said calling Lerner to testify knowing she would invoke the Fifth Amendment “accomplishes nothing and needlessly embarrasses the witness.”

After the Supreme Court's 2010 Citizens United decision allowing unfettered political spending by companies and unions, campaign expenditures by social welfare groups mushroomed. Between the 2008 and 2012 elections, it tripled to $254 million, according to the nonpartisan Center for Responsive Politics.

In November, Treasury and the Internal Revenue Service issued draft regulations that would limit the political activities of such groups that fall under section 501(c)4 of the tax code.

Republicans accused the Obama administration of trying to legalize the targeting of conservative groups. “This is a government that is seeking to silence the voices of groups that disagree with them,” said Rep. Kevin Brady, R-Texas.

Democrats said the bill is little more than an election-year ploy by Republicans to rally the party base. They note that final regulations probably wouldn't be issued for at least a year, anyway.

USA Today contributed to this report.

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