Don't Mess With Taxes

After four and a half years, the Internal Revenue Service Tea Party targeting scandal has been resolved.

On Thursday, Oct. 26, the Justice Department announced that it has entered into proposed settlements with the two major challenges by conservative groups against the IRS.

Substantial payments to plaintiffs: While the Justice Department did not discuss deal specifics, the Wall Street Journal reported that the payouts to plaintiffs in the Linchpins of Liberty and Norcal Tea Party Patriots cases could be between $1 million and $10 million.

The conservative groups who joined the lawsuits had alleged in 2013 that their applications for 501(c)(4) tax-exempt status were intentionally delayed by the IRS' politically motivated, discriminatory treatment.

The settlements still must be approved by the district courts, but the controversy that lasted, by TaxProf's running count, 1,632 days is now essentially over.

It all seems a bit anti-climactic.

Tracing the scandal's other costs: When the news broke back in May 2013 that the IRS has issued BOLO, or be on the lookout for, applications from groups that might be involved in political activity that could preclude the granting of the 501(c)(4) status, conservative groups were outraged. Republican lawmakers, particularly those in the GOP-controlled House, immediately went after the IRS.

The scrutiny led to the resignations of an acting IRS chief (Steven Miller) and the executive (Lois Lerner) in charge of the division that made the tax-exempt status decisions.

Even after Lerner left, Congress continued to try to have her prosecuted on contempt charges. That effort was finally put to rest in September.

Several Representatives also went after IRS Commissioner John Koskinen, who took over the beleaguered office well after the scandal broke. House members, however, believed Koskinen withheld information about the scandal.

They were successful in getting a House committee to censure him, but attempts to impeach Koskinen failed. His term ends Nov. 12.

IRS is sorry: Now it all comes down to legal paperwork. And the big payouts. And, oh yeah, a couple of apologies.

"It is improper for the IRS to single out groups for different treatment based on their names or ideological positions. Any entitlement to tax exemption should be based on the activities of the organization and whether they fulfill requirements of the law, not the policy positions adopted by members or the name chosen to reflect those views," said Attorney General Jeff Sessions in a statement announcing the settlements.

"There is no excuse for this conduct. Hundreds of organizations were affected by these actions, and they deserve an apology from the IRS," added the AG.

There may not be any excuses, but there's still lots to talk about regarding the saga.

Forbes' contributor Peter J. Reilly dissects the whimper that marked the end of the IRS-Tea Party battle and some of the reaction to it.

In doing so, Reilly invokes pop culture television touchstones "Seinfeld" and "King of the Hill." For that, as well as the tax information, today's Shout Out Sunday goes to Reilly.

You also might find these items of interest:

• Conservative groups sue IRS over Tea Party targeting
• IRS says 5 more staffers lost possible Tea Party-related e-mails
• No criminal charges in IRS targeting of Tea Party, others