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IRS commissioner says backlog of 60,000 applications for tax-exempt status is gone

WASHINGTON — The IRS has eliminated a huge processing backlog of groups seeking tax-exempt status, the agency’s chief said Tuesday. Tea party organizations’ claims that they were singled out for tough treatment when they applied for that designation were at the heart of a 2013 controversy over the agency.

In remarks prepared for delivery at the National Press Club, IRS Commissioner John Koskinen said there once was a backlog exceeding 60,000 applications for tax-exempt status. He said that because of new, faster processes including a shorter application form, “The result is that our inventory of applications is now current.”

A conservative legal center leading a federal lawsuit against the IRS challenged that, saying one group it represents is still awaiting an IRS ruling after five years.

“The IRS commissioner continues to mislead the public regarding this unlawful targeting scheme,” said Jay Sekulow, chief counsel of the American Center for Law and Justice.

The IRS came under fire in 2013 when one of its officials publicly apologized for inappropriately targeting conservative groups seeking tax-exempt status. By law, groups seeking that designation cannot engage in politics as their primary activity, and the IRS is the agency that decides whether applicants meet that requirement.

Several top IRS officials left the agency in reaction to the controversy that erupted. Congressional investigations are continuing but they have not linked the IRS’ handling of the groups’ applications to the White House.

The agency has also encountered criticism over questionable spending on lavish conferences for its employees and videos it produced, including one that parodied the TV show “Star Trek.” Koskinen, who became commissioner in December 2013, said he has curbed such expenditures, with conference spending down 80 percent since 2010.

He said the IRS has stopped paying performance bonuses to agency employees who owe delinquent taxes. A Treasury Department report last year said the agency paid bonuses to 1,100 workers who owed back taxes.

Koskinen said that because of budget cuts, his agency is about to lose many of its most experienced workers and executives. He said that over half its 87,000 workers are over age 50, with more than 25 percent of employees eligible to retire next year, with those percentages even higher for managers.

The agency’s workforce is down 30,000 workers since 1992, he said.