In 2012, the Internal Revenue Service temporarily suspended tax audits of churches accused of violating Section 501(c)(3)'s ban on political participation, pending final adoption of IRS rule changes to clarify which high level Treasury official has authority to make a determination under IRC Sec. 7611 that there are reasonable grounds to begin a church tax inquiry. (See prior posting.) The proposed rules have never been adopted in final form, but as was reported last month, in settling a lawsuit challenging the suspension of church tax inquiries, the IRS assured the Freedom From Religion Foundation that it has adopted procedures for reviewing, evaluating and determining whether to initiate church investigations.
As pointed out yesterday by The Blaze, from a letter attached to the FFRF's Memorandum In Support of Motion To Dismiss, a good deal can be learned of the practices which the IRS now uses. A decision to begin a church tax inquiry is "made by the Commissioner, TEGE, either directly or as concurrence to the determination made by the Director, Exempt Organizations." Complaints about violations of the political intervention ban are evaluated by the Review of Operations unit, and then by the Political Activities Referral Committee. That process has led to the conclusion that 99 churches merit a high priority examination for activities since 2010.