[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]








          EXAMINING THE IRS RESPONSE TO THE TARGETING SCANDAL

=======================================================================

                                HEARING

                               before the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             SECOND SESSION

                               __________

                             MARCH 26, 2014

                               __________

                           Serial No. 113-114

                               __________

Printed for the use of the Committee on Oversight and Government Reform







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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 DARRELL E. ISSA, California, Chairman
JOHN L. MICA, Florida                ELIJAH E. CUMMINGS, Maryland, 
MICHAEL R. TURNER, Ohio                  Ranking Minority Member
JOHN J. DUNCAN, JR., Tennessee       CAROLYN B. MALONEY, New York
PATRICK T. McHENRY, North Carolina   ELEANOR HOLMES NORTON, District of 
JIM JORDAN, Ohio                         Columbia
JASON CHAFFETZ, Utah                 JOHN F. TIERNEY, Massachusetts
TIM WALBERG, Michigan                WM. LACY CLAY, Missouri
JAMES LANKFORD, Oklahoma             STEPHEN F. LYNCH, Massachusetts
JUSTIN AMASH, Michigan               JIM COOPER, Tennessee
PAUL A. GOSAR, Arizona               GERALD E. CONNOLLY, Virginia
PATRICK MEEHAN, Pennsylvania         JACKIE SPEIER, California
SCOTT DesJARLAIS, Tennessee          MATTHEW A. CARTWRIGHT, 
TREY GOWDY, South Carolina               Pennsylvania
BLAKE FARENTHOLD, Texas              TAMMY DUCKWORTH, Illinois
DOC HASTINGS, Washington             ROBIN L. KELLY, Illinois
CYNTHIA M. LUMMIS, Wyoming           DANNY K. DAVIS, Illinois
ROB WOODALL, Georgia                 PETER WELCH, Vermont
THOMAS MASSIE, Kentucky              TONY CARDENAS, California
DOUG COLLINS, Georgia                STEVEN A. HORSFORD, Nevada
MARK MEADOWS, North Carolina         MICHELLE LUJAN GRISHAM, New Mexico
KERRY L. BENTIVOLIO, Michigan        Vacancy
RON DeSANTIS, Florida

                   Lawrence J. Brady, Staff Director
                John D. Cuaderes, Deputy Staff Director
                    Stephen Castor, General Counsel
                       Linda A. Good, Chief Clerk
                 David Rapallo, Minority Staff Director






                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on March 26, 2014...................................     1

                               WITNESSES

The Hon. John Koskinen, Commissioner, Internal Revenue Service
    Oral Statement...............................................     8
    Written Statement............................................    10

                                APPENDIX

Chart - Exempt Organizations Recommended Actions Ending Feb. 24, 
  2014, submitted by Rep. Cummings...............................    76
E-mail from Cindy Thomas, submitted by Rep. Mica.................    77
Memo from the Offfice of General Counsel, U.S. House of 
  Representatives, submitted by Chairman Issa....................    78
 Article in Washington Post, Elijah Cummings: ``Case is solved'' 
  on IRS.........................................................   100
Response to questions to Mr. Koshinen from Rep. Turner...........   102

 
          EXAMINING THE IRS RESPONSE TO THE TARGETING SCANDAL

                              ----------                              


                       Wednesday, March 26, 2014,

                  House of Representatives,
      Committee on Oversight and Government Reform,
                                           Washington, D.C.
    The committee met, pursuant to call, at 9:30 a.m., in Room 
2154, Rayburn House Office Building, Hon. Darrell E. Issa 
[chairman of the committee] presiding.
    Present: Representatives Issa, Mica, Turner, Duncan, 
Jordan, Chaffetz, Walberg, Lankford, Amash, Gosar, DesJarlais, 
Gowdy, Farenthold, Lummis, Woodall, Massie, Collins, Meadows, 
Bentivolio, DeSantis, Cummings, Maloney, Norton, Tierney, Clay, 
Lynch, Connolly, Speier, Davis, Lujan Grisham, and Kelly.
    Staff Present: Molly Boyl, Majority Deputy General Counsel 
and Parliamentarian; Lawrence J. Brady, Majority Staff 
Director; David Brewer, Majority Senior Counsel; Sharon Casey, 
Majority Senior Assistant Clerk; Steve Castor, Majority General 
Counsel; Drew Colliatie, Majority Professional Staff Member; 
John Cuaderes, Majority Deputy Staff Director; Adam P. Fromm, 
Majority Director of Member Services and Committee Operations; 
Linda Good, Majority Chief Clerk; Tyler Grimm, Majority 
Professional Staff Member; Frederick Hill, Majority Deputy 
Staff Director for Communications and Strategy; Christopher 
Hixon, Majority Chief Counsel for Oversight; Caroline Ingram, 
Majority Professional Staff Member; Michael R. Kiko, Majority 
Legislative Assistant; Jim Lewis, Majority Senior Policy 
Advisor; Mark D. Marin, Majority Deputy Staff Director for 
Oversight; Ashok M. Pinto, Majority Chief Counsel, 
Investigations; Katy Rother, Majority Counsel; Laura L. Rush, 
Majority Deputy Chief Clerk; Jessica Seale, Majority Digital 
Director; Sarah Vance, Majority Assistant Clerk; Jeff Wease, 
Majority Chief Information Officer; Meghan, Berroya, Minority 
Counsel; Aryele Bradford, Minority Press Secretary; Susanne 
Sachsman Grooms, Minority Deputy Staff Director/Chief Counsel; 
Jennifer Hoffman, Minority Communications Director; Adam 
Koshkin, Minority Research Assistant; Julia Krieger, Minority 
New Media Press Secretary; Elisa LaNier, Minority Director of 
Operations; Juan McCullum, Minority Clerk; Brian Quinn, 
Minority Counsel; Dave Rapallo, Minority Staff Director; and 
Donald Sherman, Minority Counsel.
    Chairman Issa. The Oversight Committee exists to secure two 
fundamental principles: first, Americans have a right to know 
the money Washington takes from them is well spent and, second, 
American deserves an efficient, effective Government that works 
for them. Our duty on the Oversight and Government Reform 
Committee is to protect these rights. Our solemn responsibility 
is to be accountable to taxpayers, because taxpayers have a 
right to know what they get from their Government. It is our 
job to work tirelessly in partnership with citizen watchdogs to 
deliver the facts to the American people and bring genuine 
reform to the Federal bureaucracy.
    It is now my privilege to recognize the ranking member for 
the opening statement.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    Commissioner Koskinen, I want to thank you for being here 
this morning, and I want to thank you, Mr. Chairman, for 
calling this hearing. I think it is very important that we look 
at what the inspector general for the Treasury recommended and 
take a look back at the research that he did.
    Nearly one year ago, the Treasury Inspector General for Tax 
Administration, Russell George, issued a report concluding that 
IRS employees used ``inappropriate criteria'' to identify tax-
exempt applications for review. I want to revisit the findings 
of his report.
    The IG found that there was ``ineffective management'' at 
the IRS. The first line of the results section of the report 
said, this began with employees in the Determinations Unit of 
the IRS Office in Cincinnati. I didn't say that, the IG said 
that. The IG also went on to say that these employees 
``developed and used inappropriate criteria to identify 
applications from organizations with the words tea party in 
their names.'' The IG also said these employees ``developed and 
implemented inappropriate criteria in part due to insufficient 
oversight provided by management.''
    The IG report that former IRS official Lois Lerner did not 
disclose the use of these inappropriate criteria until 2011, a 
year after it began. Again, I didn't say that, the IG said 
that. Although ``she immediately'' ordered the practice to 
stop, the IG stated that employees began again using different 
inappropriate criteria ``without management knowledge.''
    In contrast, the inspector general never found any evidence 
to support the central Republican accusations in this 
investigation that this was a political collusion directed by 
or on behalf of the White House.
    Before our committee received a single document or 
interviewed one witness, Chairman Issa went on national 
television and said, ``This was the targeting of the 
President's political enemies, effectively it lies about it 
during the election.''
    Similarly, Representative Al Rogers, the chairman of the 
Committee on Appropriations, stated on national television, 
``The enemies list out of the White House that IRS was engaged 
in shutting down or trying to shut down the conservative 
political viewpoint across the Country, an enemies list that 
rivals that of another president some time ago.''
    Representative Dave Camp, chairman of the Ways and Means 
Committee, said, ``This appears to be just the latest example 
of a culture of coverups and political intimidation in this 
Administration.''
    The inspector general identified no evidence to support 
these wild political accusations. The IG reported that, 
according to the interviews they conducted, the inappropriate 
criteria ``were not influenced by any individual organization 
outside the IRS.'' The IG testified before this committee that 
his own chief investigator reviewed more than 5,500 emails and 
found no evidence of any political motivation in the actions of 
the IRS employees.
    Rather than continuing this partisan search for non-
existent connections to the White House, I believe the 
committee should focus squarely on the recommendations made by 
the inspector general. The IG made nine recommendations in his 
report last May. As of February of this year, the IRS now 
reports that it has completed all nine.
    For example, the IG recommended that the IRS change its 
screening and approval process for tax-exempt applications. In 
response, the IRS ended the end of so-called be on the lookout 
lists and developed new guidance and training.
    The IG also recommended that the IRS ensure that applicants 
are ``approved or denied expeditiously.'' In response, the IRS 
made significant progress on its backlog over the past year, 
closing 87 percent of these cases.
    As I close, I want to thank the commissioner and his 
predecessor, Danny Werfel, for their extraordinary cooperation 
with Congress. I completely disagree with the chairman's letter 
yesterday complaining about the agency's so-called failure to 
produce documents and its noncompliance with committee 
requests. Nothing could be further from the truth. More than 
250 IRS employees have spent nearly 100,000 hours responding to 
congressional requests. They have delivered more than 420,000 
pages of documents to this committee and they have spent at 
least $14 million in doing so.
    The chairman's statements simply disregard these facts. 
They are also at odds with Chairman Camp of the Ways and Means 
Committee, who issued a press release just this month praising 
IRS for its cooperation with document requests as a 
``significant step forward.''
    Commissioner, I wanted to thank you for your efforts during 
this investigation and for your exceptional cooperation, and I 
want to thank all of those IRS employees who are working so 
hard and tirelessly to do their jobs.
    With that, Mr. Chairman, I thank you and I yield back.
    Chairman Issa. I thank the gentleman.
    I am pleased to welcome our witness, Commissioner John 
Koskinen. He was appointed by the President to restore trust 
and accountability to the IRS. Commissioner, you have a 
difficult task ahead of you. The American people do not have, 
and my opening statement says any faith, but they certainly 
don't have the faith they once had in the IRS to be truly a 
nonpartisan, nonpolitical tax collector, and rightfully so.
    Does nonpartisan, nonpolitical agency target certain groups 
based on their names or political ideology? The IRS did. Does a 
nonpartisan or nonpolitical agency conspire to leak the 
findings of an independent inspector general report? The IRS 
did. Does a nonpartisan, nonpolitical agency withhold documents 
requested during a congressional investigation subject to a 
lawful subpoena? The IRS does, did, and continues to. Does a 
nonpartisan, nonpolitical agency reinterpret laws protecting 
taxpayer information when it appears their employees violated 
the law? The IRS does. Does a nonpartisan, nonpolitical agency 
blatantly ignore a congressional subpoena? Again, the IRS 
continues to.
    The American people believe the IRS is now a politicized 
agency because the IRS is a politicized agency. Our 
constituents deserve better than this, Commissioner. You are 
the President's man at the IRS. You are one of only two 
political appointees. But it is clear that individuals acted on 
their politics, and we now have some, but only some, of the 
emails to prove it.
    You were brought in to do a very hard job, and no doubt you 
ask yourself every day why did I get and ask for and accept one 
of the hardest jobs anyone could ever have in Washington? And I 
appreciate that you are there and that you want to do that job.
    One of the ways you could do it is by ordering your people 
to simply comply with outstanding subpoenas. The simple fact is 
your response to the IRS targeting scandal has been bold by the 
ranking member's standard and dismal by my standard.
    This committee doesn't count how many documents are 
produced, but we do count when documents clearly responsive to 
a subpoena are clearly not delivered. The committee has made 
document requests almost 11 months ago that are still 
unfulfilled. I issued two subpoenas, the second to you 
personally, and they are still outstanding, and this is 
unacceptable.
    Unfortunately, you have been more concerned with managing 
the political fallout than cooperating with Congress, or at 
least this committee. I requested that you produce all of Lois 
Lerner's emails to this committee. She won't talk to us, so 
these emails are the next best substitute, and we need these 
emails. And you know we are not only entitled to them, but, by 
all that is holy, we deserve, and the American people deserve, 
access to know why somebody who cites Citizens United; who 
cites political gains, including the outcome of Senate 
majorities; who cites in a public speech statements about we 
need to fix it because the FEC can't do it; who cites they want 
us to do it and then takes the Fifth when we ask who they are. 
Those emails in their entirety are clearly responsive.
    These are easy requests, and ones that were made back in 
May but have not been honored, and that request is one that you 
said you would work to fully comply. I understand you reached 
an agreement with the Ways and Means Committee to produce a 
limited subset of Ms. Lerner's emails. Let me make it very 
clear. Your agreement with Ways and Means, without a subpoena, 
does not satisfy your obligation under a subpoena to produce 
all of her emails to this committee.
    Commissioner, your objection or your refusal to cooperate 
with the committee delays bringing the truth, costs the 
American people the confidence they hope to rebuild, and 
clearly is running up the cost to the American taxpayer. I know 
you want to bring this investigation to a close as soon as 
possible, and I do too. But the only way you can do that is to 
fully comply with our requests, and I hope you will take that 
to heart today.
    I yield back.
    Chairman Issa. I now recognize the gentleman from Ohio for 
his opening statement.
    Mr. Jordan. Thank you, Mr. Chairman. I would like to 
provide a little context for today's hearing. Let's go back to 
January 2010. The President of the United States, in his State 
of the Union address, called out the Supreme Court regarding 
the Citizens United decision. That same year, 2010, the 
President, numerous times, talked about Tea Party groups as 
shadowy groups who would hurt our democracy. That same year 
Senator Schumer says, we are going to get to the bottom of 
this, let's encourage the IRS to investigate. Senator Baucus, 
that same year, asked the IRS to investigate (c)(4) 
applications and (c)(4) groups. Senator Durbin asked the IRS to 
investigate Crossroads GPS.
    And then, in that same year, 2010, two weeks before the 
election, October 19th, at Duke University, Lois Lerner gives a 
speech and she says this: The Supreme Court dealt a huge blow 
in the Citizens United decision and everyone is up in arms 
because they don't like it; they want the IRS to fix the 
problem. The IRS law is not set up to fix the problem; (c)(4)s 
can do straight political activity. So everybody is screaming 
at us right now.
    Who is everybody? Everybody is not everybody. Everybody is 
the President and Democrat senators who asked her to do 
something. Fix it now, before the election. Lois Lerner says, I 
can't do anything right now. She couldn't fix it before the 
2010 mid-term election, but what she could do is start a 
project to deal with it in the future, and that is exactly what 
she did. That same fall she sent an email, again, just weeks 
before the mid-term election. Lerner tells her colleagues let's 
do a (c)(4) project next year. But she also says we need to be 
cautious so it isn't a per se political project. In fact, the 
chairman put this email up at our last hearing. Per se 
political project means that is code for it is a political 
project, we just need to make it look like it is not a 
political project.
    Then, in early 2011, Lois Lerner orders the multi-tiered 
review of (c)(4) applications. Multi-tiered review, you know 
what that is? That is code for we are going to delay, we are 
going to harass, we are never going to approve these people, we 
are going to make it difficult. That is part of the (c)(4) 
project.
    And then make no mistake, she put Washington in charge. 
This email is also one that the chairman put up at our least 
meeting, where Lois Lerner said this in February of 2011: Tea 
Party matter very dangerous. Cinci should probably not have 
these cases. So this narrative about Cincinnati line agents and 
Cincinnati doing this is completely false. She ordered them not 
to have these cases. And then what happened? Lois Lerner got 
caught with her hand in the cookie jar. Tea Party groups came 
to us and said we are being harassed. We asked the inspector 
general to do an investigation; he did the audit and then 
before he can release the audit, unprecedented, before he 
releases the audit, Lois Lerner, in a speech in front of the 
Bar Association here in this town, with a planted question from 
a friend, reveals that, yes, targeting was taking place. And 
what does she do? She throws the Cincinnati people under the 
bus. The very people she said shouldn't have the cases, good 
civil servants, she throws them under the bus.
    And here is the real kicker: Lois Lerner, who did this 
project from the pressure from the President and Democrat 
senators, who did this project, she won't talk to us. She won't 
talk to us and our witness today won't give us her emails, even 
though we subpoenaed them over six months ago.
    Mr. Chairman, Lois Lerner won't talk to us. She will talk 
to the Justice Department because she knows that investigation. 
She will talk to the people who can put her in jail, but she 
won't talk to us, and the guy who can give us the emails won't 
give us the emails.
    And here is why today's hearing is so important: the (c)(4) 
rule that is being proposed, that got 149,000 comments, would 
codify what Lois Lerner put into practice, would in fact 
accomplish the goal that she set out to do in 2010. The (c)(4) 
rule, we had a hearing three weeks ago, Mr. Chairman. We had a 
hearing three weeks ago where we had the ACLU, Tea Party 
patriots, the Motorcyclists Association of America, and the 
Home School Legal Defense. All four of those groups came to 
that hearing and you know what they all said? This rule stinks 
and should be thrown out. Think about that. From the ACLU to 
the Tea Party, from home schoolers to Harley riders, everyone 
knows this rule stinks. Everyone knows except the IRS. And now, 
today, we get a chance finally to question the guy in charge of 
this rule, running this agency.
    Here is the final thing, Mr. Chairman, and I will yield 
back. The same people who pressured Lois Lerner to fix the 
problem are the same people who picked John Koskinen to finish 
the job. That is where we are at. And all we are asking is give 
us the emails. Throw this rule in the trash, because everyone 
knows--the only people who want this rule are this 
Administration and the IRS. Everyone else knows this thing 
stinks. Everyone else knows it. And that is why today's hearing 
is so important, Mr. Chairman
    With that, I yield back.
    Chairman Issa. I thank the gentleman.
    We now recognize the gentleman from Virginia for an opening 
statement on behalf of Mr. Cartwright.
    Mr. Connolly. Thank you, Mr. Chairman.
    Mr. Koskinen, welcome back. I remember working with you on 
Y2K. You did a great job then and I am certainly hopeful you 
will do a great job now. I certainly think you are a great 
choice to be the new commissioner of the IRS.
    In listening to statements from the other side of the 
aisle, one might think that the IRS has just stonewalled the 
Congress and has been completely uncooperative. And yet, since 
the release of the audit report, the IRS has produced 420,000 
pages of documents to this committee, facilitated 32 interviews 
of current and former IRS employees, and testified at six 
separate hearings. That is not non-cooperation.
    In addition, on March 7, 2014, Congressman Dave Camp, the 
chairman of the Ways and Means Committee, issued a press 
release commending the IRS on its cooperation with the 
committee and in particular its production of documents. He 
stated, ``This is a significant step forward and will help us 
complete the investigation.'' That cooperation included an 
agreement with the Ways and Means Committee in terms of which 
emails in fact would be provided.
    The chairman says he shares your goal, your desire to want 
to end this investigation, but he needs more cooperation, and I 
certainly take the chairman at his word. But one has the 
suspicion that some of our friends on the other side of the 
aisle, the last thing in the world they would do is end this 
ongoing, if you can call it that, investigation, because it 
serves their political aims. Mr. Jordan just cited a panel we 
had. I was at that hearing, and one had the impression that 
this is all feeding the base, it is designed to get certain 
groups all riled up in time for a mid-term election.
    Mr. Jordan. Would the gentleman yield for a question?
    Mr. Connolly. I am going to finish my statement, Mr. 
Jordan, as you were allowed to finish yours.
    And that the serious purpose of investigation seems to be 
lost in the mire and the muck.
    This committee, on a partisan vote, decided that a citizen, 
who happened to work for IRS, not a heroic figure in this 
story, but a citizen protected by constitutional rights, had in 
fact waived her rights, a very dubious finding in light of long 
case history in the courts, going back to the McCarthy era when 
people needed that Fifth Amendment to make sure they weren't 
entrapped by their own words, by star chambers, or by people 
willing to play fast and loose with facts and with the truth to 
make some political point. And the fact that you might be an 
unwitting victim, you are a casualty of war.
    None of my colleagues on this committee, of course, would 
engage in that kind of thing, but to strip an American citizen, 
or claim to strip an American citizen, of her Fifth Amendment 
right, a right that was enshrined as sacred by the founders, 
who had been treated to the tender loving mercies of then 
British colonial justice. It stung so much that they wanted to 
protect every American citizen from that kind of treatment, 
even if they might be hiding something, even if they weren't 
heroic figures. Precisely why the Fifth Amendment was there.
    So, Mr. Koskinen, there are some of us here who wish you 
well and will certainly cooperate with you and try to make sure 
yours is a successful tenure. Obviously, to the extent that you 
can cooperate even more fully with this committee, that would 
be welcome. But be aware that unfortunately this committee has 
a habit sometimes of cherry-picking facts and of leaking. I 
heard the chairman complain about the IRS actually leaking 
documents. My, my, that would be a terrible thing if true; 
certainly not something we ever do on this committee. But just 
in case be prepared, because that may happen to you, too. So 
thank you for your cooperation, but be on your guard, because 
there is something else at work here.
    I yield back.
    Chairman Issa. Members may have seven days in which to 
submit opening statements for the record, including extraneous 
materials therein.
    The chair now welcomes the Honorable John Koskinen, who is 
the Commissioner of the Internal Revenue Service. Welcome.
    Pursuant to the rules, all witnesses will be sworn. Would 
you please rise, raise your right hand to take the oath?
    Do you solemnly swear or affirm that the testimony you are 
about to give will be the truth, the whole truth, and nothing 
but the truth?
    [Witness responds in the affirmative.]
    Chairman Issa. Please be seated.
    Let the record reflect the witness answered in the 
affirmative.
    You are a seasoned pro at this, but I will remind everyone 
your entire statement is in the record and it has been 
distributed in the packets, and you may summarize as you see 
fit. You are recognized.

    STATEMENT OF THE HONORABLE JOHN KOSKINEN, COMMISSIONER, 
                    INTERNAL REVENUE SERVICE

    Mr. Koskinen. Thank you. Good morning, Chairman Issa, 
Ranking Member Cummings, members of the committee. Thank you 
for the opportunity to appear before you today to discuss IRS 
activities in regard to the determinations process for tax-
exempt status. I am honored to serve as the IRS commissioner 
and to have the opportunity to lead this agency and its 
dedicated employees because I believe that the success of the 
IRS is vital for this Country.
    One of my primary responsibilities as IRS commissioner is 
to restore whatever public trust has been lost as a result of 
the management problems that came to light last year in regard 
to the application process for 501(c)(4) status. Taxpayers need 
to be confident that the IRS will treat them fairly no matter 
what their backgrounds, their affiliations, who they voted for 
in the last election. I am committed to ensuring we restore and 
maintain that trust.
    I am pleased to report to you that the IRS has made 
significant progress in addressing the issues and concerns with 
the 501(c)(4) determinations process. First of all, we have 
been responding to the recommendations made by the Treasury 
Inspector General for Tax Administration. It was the inspector 
general's report in May of last year that found applications 
for 501(c)(4) status had been screened using inappropriate 
criteria.
    As of late January of this year, we completed action on all 
nine of the inspector general's recommendations. Our actions 
have included reducing the inventory of 501(c)(4) applications, 
including the group of 145 cases in the so-called priority 
backlog, that is, those that were pending for more than 120 
days on or before May 2013. As of this month, 126 of those 
cases have been closed, including 98 that were approved. Of 
those 98, 43 took advantage of a self-certification procedure 
re-offered last year.
    Also in response to the inspector general, the Treasury and 
IRS issued proposed regulations in November that are intended 
to provide clarity in determining the extent to which 501(c)(4) 
organizations may engage in political activity without 
endangering their tax-exempt status. As you know, we have 
received over 150,000 comments on that draft. Although I do not 
control by myself the rulemaking process, the Treasury and IRS 
have a longstanding history of working cooperatively in this 
regard, and I will do my best to ensure that any final 
regulation is fair to everyone, clear, and easy to administer.
    Along with the actions we have taken in response to the 
inspector general, we continue to make every effort to 
cooperate with the six ongoing investigations into the 
501(c)(4) determinations process, including this committee's 
investigations. Over the last 18 months, the IRS has devoted 
significant resources to this committee's investigation and 
requests for information, as well as those of other 
congressional committees. More than 250 IRS employees have 
spent nearly 100,000 hours working directly on complying with 
the investigations, at a direct cost of $8 million. We also had 
to add capacity to our computer systems to make sure we were 
protecting taxpayer information while processing these 
materials. We estimate that work cost another $6 million or 
more.
    To date, we have produced more than 690,000 pages of 
unredacted documents to the House Ways and Means Committee and 
the Senate Finance Committees, which have Section 6103 
authority, which means they can see taxpayer information. We 
have already produced more than 420,000 pages of redacted 
documents to this committee and the Senate Permanent Committee 
and Subcommittee on Investigations. Last week we were pleased 
to announce that we believe we have completed our productions 
to the Ways and Means and Finance Committees of all documents 
we have identified related to the processing and review of 
applications for tax-exempt status as described in the May 8, 
2013 inspector general report.
    We are continuing to cooperate with this committee, and I 
would stress that, we are continuing to cooperate with this 
committee and others receiving redacted documents, and we will 
continue redacting and providing documents until that process 
is complete. As part of that process, it is my understanding 
that we will be delivering a substantial number of documents to 
this committee later today as part of the ongoing process. In 
light of those document productions, I hope that the 
investigations of the (c)(4) determinations process can be 
concluded in the very near future.
    In the event that this committee would, at some point in 
the future, decide to investigate other matters pertaining to 
the (c)(4) area, such as the rulemaking process or the 
examinations process, the IRS stands ready to cooperate with 
you.
    Mr. Chairman, that concludes my statement. I would be happy 
to be take your questions.
    [Prepared statement of Mr. Koskinen follows:]


[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]


    Chairman Issa. Thank you. I will recognize myself for a 
round of questioning.
    Did you need to upgrade your computers in order to produce 
all of Lois Lerner's emails?
    Mr. Koskinen. I am sorry, could you clarify?
    Chairman Issa. Did you need to upgrade your computers to 
produce all of Lois Lerner's emails?
    Mr. Koskinen. We had to upgrade our computers to produce 
all of the emails and documents.
    Chairman Issa. Commissioner, I appreciate that, and my time 
is limited. I recently pulled all of my emails off of the House 
computers. It took one person at House Call a part of, a very 
small part of a morning to gin it up and produce it. I 
understand it takes a while to go through them, but, if I am 
correct, in a matter of hours, not after we subpoenaed, but 
after we showed interest, your agency had taken all of Lois 
Lerner's, all of Holly Paz's, all of William Wilkins's, all of 
Jonathan Davis, former chief of staff, all of, or maybe or 
maybe not, all of them pertaining to the White House. But the 
first four take a matter of minutes to do.
    So my question is our subpoena, which is not extensive, for 
those four particularly, asked for all the emails that somebody 
who has, in the emails we have seen, both Government and non-
Government emails in some cases, acted overtly political in her 
speeches and her activities, including what Mr. Jordan quoted. 
We asked for all of her emails. Do you have any privilege or 
any reason that you can't and shouldn't have delivered that 
months ago?
    Mr. Koskinen. You seem to have more information about this 
than I do. We have 90,000 employees and my understanding of the 
process is that to go through all of those emails, which are 
millions of emails, to make sure we have not only the outgoing 
emails, but the incoming emails, is not a matter of a few 
minutes or a few hours. But, in any event, we have provided for 
all of those people, or are in the process of providing, all of 
the information and all of the emails related to the 
determinations process.
    Chairman Issa. Commissioner, that is not the subpoena, and 
I want to be very clear. We issued you lawful subpoenas because 
you didn't cooperate based on letters. Our subpoena says all of 
Lois Lerner's emails. Is it your position today that you intend 
to give us those responsive to some key search word or you 
intend to give us all of Lois Lerner's emails, all of Holly 
Paz's emails, all of William Wilkins's emails, all of Jonathan 
Davis's emails?
    Mr. Koskinen. We are working through the process. We have 
never said we would not provide those.
    Chairman Issa. Will you provide all of the emails for those 
four individuals?
    Mr. Koskinen. We will provide you--we are actually trying 
to, in an orderly way, conclude the investigation on the 
determination process, which is what the IG report reported to. 
We have had over 250 people at various times working on this 
investigation. We are producing emails. You will get email 
copies today, redacted, and you will continue to get them. Our 
hope is that you could concentrate on the determination 
process. GAO is already, at the congressional request, doing a 
review, starting a review on the examination process. As I have 
said in my letters to you, if you would like----
    Chairman Issa. No, commissioner, you said something and I 
want to focus on that. You said your hope is that we would 
focus on the determination process.
    Mr. Koskinen. I can't tell you what to focus on.
    Chairman Issa. Thank you.
    Mr. Koskinen. It is up to you to focus on whatever you 
would like.
    Chairman Issa. We are focusing on those individuals. We 
have asked for all of their emails in a legal subpoena. My 
question to you today: Will you commit here, today, to provide 
all of the emails? Not all the emails you believe are 
responsive, not all the emails you choose to give, not all the 
emails that are other than embarrassing; all the emails.
    Mr. Koskinen. Mr. Chairman, we are prepared to continue to 
work with your staff. As you can understand, when you say all 
of the emails, you are going to get hundreds of thousands of 
pages, irrelevant documents.
    Chairman Issa. No, no. No, I am sorry. Lois Lerner is an 
individual. We are asking for all of her emails. She obviously 
had a limited amount of emails. Quite frankly, we asked for all 
the emails. We believe that the emails, for example, where she 
talked about the outcome of the Senate races maintaining 
Democratic control because of Indiana and other States, the 
outcome of the Maryland pro-gay initiative, all of those are 
responsive to who she was and why she did what she did. 
Therefore, we have asked for, in the case of these individuals, 
all of their emails. Holly Paz, for example, said she didn't 
know what Citizens United was, while Lois Lerner made it clear 
that she was trying to find a way to enforce around Citizens 
United at the IRS. And we have already seen the documents for 
that.
    Will you today commit to deliver all of the emails, not all 
that you think are responsive, all the four squares that any 
lawyer can read of the subpoena says we are asking for, which 
is all the emails for Lois Lerner, all the emails for Holly 
Paz, all the emails for William Wilkins, and all the emails for 
Jonathan Davis? Now, these are all of the ins and outs from 
their mailboxes. It is not difficult. You already have pulled 
them. There is no question at all; it is a question of will you 
deliver them.
    Mr. Koskinen. Mr. Chairman, we are happy to continue to 
work with you and we will advise you--I am not aware that we 
pulled them all, but to the extent we have, they all have to be 
redacted, and we will work with you and advise you as to what 
the volume is. The reason the search terms were selected, they 
were selected by committee staff here and in the other 
investigations so that----
    Chairman Issa. No, your people--and my time has expired. 
You previously selected search terms, asked us to give 
priorities. That is all fine.
    Mr. Koskinen. That is not true.
    Chairman Issa. The subpoena that was personally delivered 
to you, which we expect you to comply with or potentially be 
held in contempt, those emails were very specific based on 
individuals who have become specific focus on why they did what 
they did and what they have said, whether it is true or not, is 
critical to this committee's discovery of intent. Will you 
commit to deliver all of those emails, redacted only for 6103?
    Mr. Koskinen. Yes. As I said, we have never said we 
wouldn't produce those emails. The search terms, just to clear 
the record, were not selected by the IRS, they were in fact 
selected in cooperation with various congressional 
investigations on the House and Senate side to try to limit the 
volume of material you are going to get. We will be happy to 
provide you volumes of material.
    Chairman Issa. Okay, my time has expired, but let me make 
it clear in closing. It does not take any search terms to 
respond to all the emails of Lois Lerner.
    Mr. Koskinen. You are going to get a lot of emails, and, as 
noted earlier, you may want to have this investigation go on 
forever. We have provided you all of the emails relevant to the 
IG report. We are providing you Lois Lerner's emails with 
regard to issues that you have raised about the examination 
process, about the appeals process, and about the regulatory 
process.
    Chairman Issa. I appreciate that.
    The gentleman from Maryland.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    I think the chairman has asked some very good questions, 
and I want to give you an opportunity to respond. So when you 
all are going through these emails, the last part of what you 
said is very significant. You said something about they have to 
be relevant. I mean, where are you getting all of that from? 
You remember what you just said, the last part of it? It 
sounded like there were certain things that were used, terms 
that were used to decide what you think is responsive to the 
subpoena. Now, can you explain that to us?
    Mr. Koskinen. Yes.
    Mr. Cummings. In other words, if she had a personal email 
and she was talking about shopping or something, whatever, are 
you all separating? Is that part of the process? I don't 
understand.
    Mr. Koskinen. Part of the process----
    Mr. Cummings. You said something about relevance. Can you 
explain that?
    Mr. Koskinen. Part of the process when this started, 
because there are literally millions of emails, was to take a 
look at, in agreement with the staffs of the investigating 
committees, take a look at 83, ultimately it was originally a 
smaller number, the IRS added to the custodians as it were, 
that is, the people sending and receiving emails, there are 83 
of those that we agreed to look at. The terms in terms of what 
would be relevant were determined by congressional committees, 
as well as the IRS, to try to limit the volume. As I say, 
limiting the volume, you still have 700,000 pages of relevant 
documents. To the extent that somebody wants to look at 
hundreds of thousands more pages of what the search terms 
defined by the Congress would be termed irrelevant, at some 
point we are happy to provide those. We will provide those in 
the orderly course.
    But I will tell you that our experience is it is going to 
be an overwhelming volume of materials. They will take us some 
significant time to redact taxpayer information, a significant 
part of which will have nothing to do with this investigation. 
But if that is the way the committee wants to go, we will go 
that way. But the other committees, and staff of this committee 
in the early determinations, decided that that would be a 
fruitless task of overwhelming the investigators, not us, 
overwhelming the investigators with thousands of pages of 
irrelevant documents. Therefore, they suggested with us and 
selected with us search terms of what would be relevant: Tea 
Party, examinations, whatever else they picked. There are a 
whole series of those terms designed to limit the volume of 
materials.
    We still have provided a lot of duplicative and probably 
irrelevant materials within those search terms, but we have not 
determined anything within those search terms. We have said if 
those are the terms that will help you winnow it down, we are 
happy to work with you. But if the committee wants to get 
simply large volumes of personal emails from a lot of different 
people, we will go through again, making sure that we redact 
those appropriately. As I say, we have provided unredacted 
copies of all of this in terms of the relevance determined by 
the committees to the other committees, and we provided all of 
the redacted information available now and we are continue to 
redact it. It cannot be done overnight.
    Mr. Cummings. Thank you very much.
    I want to go to the recommendations of the inspector 
general, because this is Oversight and Government Reform, and I 
think the committee ought to take some credit for what you have 
said that there were nine recommendations and apparently you 
all have been able to address all nine of them. We don't hear 
that quite often in this committee, by the way. So the 
inspector general's report, which was issued in May of last 
year, made nine recommendations. I have a chart here that lists 
each one of these nine recommendations from the inspector 
general. The title of the chart is Exempt Organizations' 
Recommended Actions Ending February 24, 2014.
    Mr. Chairman, I ask unanimous consent that this chart from 
the IRS be entered into the record.
    Chairman Issa. Without objection, so ordered.
    Mr. Cummings. Commissioner, in addition to listing each of 
the nine recommendations, this chart describes in detail the 
status of each recommendation. It describes the work that has 
taken place over the last 10 months, as well as the specific 
reforms that were implemented, is that correct? Are you 
familiar with the chart?
    Mr. Koskinen. Yes.
    Mr. Cummings. If I am reading this chart correctly, it 
appears that all nine of the inspector general's 
recommendations have been fulfilled. Is that right?
    Mr. Koskinen. That is correct.
    Mr. Cummings. Let's look more closely at the status of 
these recommendations.
    The inspector general's first several recommendations begin 
on page 10 of his report. They propose that the IRS change its 
procedures for how screeners in Cincinnati classify 
applications. All of these recommendations are now marked as 
completed.
    Commissioner, can you explain what new guidance the IRS has 
provided to screeners in Cincinnati about how they should 
classify and process these applications in an appropriate way?
    Mr. Koskinen. Yes. The criteria for exemption under (c)(4) 
are complicated because it is a ``facts and circumstance'' 
determination. The guidance and the new training has provided 
more guidance to those reviewing as to what is appropriate 
political advocacy and what is direct political campaign 
intervention. It is the campaign intervention that if it 
becomes your primary activity, you, in fact, are not eligible 
to be a 501(c)(4). There obviously are complicated terms. We 
provided better guidance and we have also provided improved and 
new supervision for any determination that is going to be 
delayed. We also have provided clear lines of authority so if 
anyone needs advice or additional assistance they can get that 
automatically and easily.
    Mr. Cummings. On page 17 of the inspector general's report 
he lists another recommendation: ``Provide oversight to ensure 
that potential political cases, some of which have been in 
process for three years, are approved or denied 
expeditiously.'' In response, the IRS chart says that this ``As 
of February 21st, 2014, 112 cases in the original backlog, 85 
percent, have been closed.''
    Commissioner, this is good news, and I understand from your 
testimony today that this number has gone even higher, to 87 
percent. Can you please explain how this expedited review 
process worked? I think I have one minute left on my time.
    Mr. Koskinen. The way that worked is Interim Commissioner 
Danny Werfel, who I think did a great job as the interim, 
established a process for expedited review, and any applicant 
who would simply certify that they were not going to spend more 
than 40 percent of their time on political activity could be 
approved immediately. And that streamlined process continues 
for new applicants. Forty-five or so of the existing at that 
time pending applicants filed that paper and were immediately 
reviewed and approved. Of those that are still pending, they 
have decided not to, in fact, sign the affidavit that they 
would not spend more than 40 percent of their time on political 
activity.
    Mr. Cummings. My final question, I understand that the IRS 
has now completed all of the inspector general's 
recommendations, but, going forward, what additional plans do 
you have to ensure that these management problems have been 
fully addressed?
    Mr. Koskinen. We have agreed with the inspector general 
that before any election we will conduct additional training 
sessions and try to sensitize all of the people reviewing 
applications to make sure that we handle them appropriately, no 
matter what the political background of any of the 
organizations; and this would apply to people at one end of the 
political spectrum or the other. That will be done before every 
election as we go forward.
    Chairman Issa. Thank you.
    Before I call another member, I want to make it clear staff 
has informed me, for the record, that early on with the IRS 
they did mutually agree to search terms. That was before the 
subpoenas were issued. There was never an assurance that those 
search terms were being used, and to this day we don't know if 
those search terms were actually used, so one of the challenges 
is that that was abandoned in favor of subpoenas because of 
what they believed to be noncompliance a number of months in. 
But there was an initial attempt to work cooperatively but, as 
I said, there was a question of whether or not those search 
terms ever actually got used. So thank you.
    We now go to the gentleman from Florida, Mr. Mica.
    Mr. Mica. Well, thank you, Mr. Chairman.
    We have had an opportunity to interact in the past and 
always appreciate your candor. At the very heart of this matter 
is a basic fact that IRS appears to have been used prior to the 
election, the presidential election, in a concerted effort to 
close down or keep at bay conservative organizations by 
targeting them. You are aware of that, sir?
    Mr. Koskinen. I am aware, as was noted earlier, that the 
inspector general found inappropriate criteria were used to 
select organizations for further review. He did not refer to it 
as targeting.
    Mr. Mica. But you heard one of the principal IRS officials 
who was involved with Lois Lerner, who came to the chair where 
you are sitting now and took the Fifth Amendment. She is at the 
heart of most of this activity. It was pointed out by Mr. 
Jordan that she concocted it was almost a Hollywood production 
before the inspector general, May 14th, came out with his 
report to blame the people in Cincinnati, some rogue IRS 
employees who gathered around the water cooler and concocted a 
scheme to again target. And I think she laid that out, is that 
not correct?
    I mean, historically, you know that as a fact. She appeared 
before the American Bar Association before the report came out 
and made those statements, correct?
    Mr. Koskinen. She did make those statements.
    Mr. Mica. Okay.
    Mr. Koskinen. I would note that because she took the Fifth, 
as I said in a letter to the chairman----
    Mr. Mica. Again, this committee, it is nice to be here for 
a while because you see how people try to throw people under 
the bus. Whether it is the chairman, Mr. Cummings said the case 
is closed. We started our investigation on June 9th. In May we 
started. June 9th Mr. Cummings, the ranking member, said it 
appears the case is closed. And then June 9th--well, he said I 
see the case is solved. If it were me, I would wrap this case 
up and move on, to be frank. So he tries to throw the case 
under the bus. He tried to throw the chairman under the bus. He 
sent a letter just before that: Your actions over the past 
three years do not reflect a responsible bipartisan approach to 
investigations.
    Now, he has a constitutional and a House responsibility for 
investigations and oversight. You have a responsibility to 
provide us with information. We have asked you specifically for 
about a half a dozen individuals' emails, including Lois 
Lerner, is that correct?
    Mr. Koskinen. Yes.
    Mr. Mica. Okay. And you said, you just testified to us 
probably most of--and you said you gave 640,000 to the Ways and 
Means and 420 to our committee. But you also said here, and we 
can play the tape back, probably most irrelevant material, 
right?
    Mr. Koskinen. Most irrelevant material.
    Mr. Mica. Probably mostly irrelevant material were your 
words.
    Mr. Koskinen. Of the material we provided.
    Mr. Mica. At great expense. IRS and most bureaucracies have 
no problem spending lots of money doing things we don't need. 
We asked you very specifically for the emails from six 
individuals, a half a dozen individuals, and you have not 
complied, including Lois Lerner. Is that correct?
    Mr. Koskinen. My point was what you are going to get is 
mostly irrelevant material.
    Mr. Mica. I know. And we aren't interested in it. We are 
interested specifically in Lois Lerner and others to find out 
who did what. Are you aware of Cindy Thomas's statements? She 
was the chief person out in Cincinnati, and she said, May 10th, 
with a copy to Lois Lerner, we have a copy of that----
    Chairman Issa. To Lois Lerner with a copy to Holly Paz.
    Mr. Mica. To Lois Lerner with a copy to Holly Paz. And she 
said Cincinnati wasn't publicly thrown under the bus; instead, 
it was hit by a convoy of Mack trucks. Are you aware of her 
statement as to what took place?
    Mr. Koskinen. I am. I am aware of the fact that you already 
have a significant number of Lois Lerner emails, obviously, 
and, in fact, we have been trying to----
    Mr. Mica. But we don't have what we want. And, again, it is 
a game of you providing us with probably huge amounts of 
irrelevant material.
    Mr. Koskinen. That is what you are going to get.
    Mr. Mica. And we aren't interested in personal. You could 
give us a billion documents. That is not what we asked. We 
asked specifically----
    Mr. Koskinen. Right. And what you are going to get--and I 
would like to----
    Chairman Issa. The gentleman's time has expired, but you 
may answer.
    Mr. Koskinen. Can I answer his question some time?
    Chairman Issa. Of course. That is what I said, the 
gentleman's time has expired, but you may answer.
    Mr. Koskinen. Thank you. First of all, your earlier comment 
about your staff being concerned about whether the search terms 
were being followed is the first time I have heard that. We 
have followed those search terms. No other committee, none of 
the other five investigations going on have raised any question 
about whether we have in fact followed on those search terms. 
So if your staff has that concern, I would appreciate it if 
they would let us know, because none of the other five 
investigations and none of the other five staffs have raised 
that issue; and, as far as I know, we have abided by those 
search terms and provided everything that the committee has 
requested pursuant to those search terms and with regard to the 
determination process.
    With regard to Lois Lerner, as I said in my letter to you, 
because you have not been able to cross-examine her because she 
is not an IRS employee, the first priority we have, we have 
already been providing you the emails. In fact, your staff 
report cited a number of them that you have had, her emails 
with regard to the determination process. You have been able to 
cross-examine over 30 witnesses about anything you wanted to 
talk to them about, but because you could not talk to Lois, we 
are providing you, and they have to be redacted, we are going 
to provide you Lois Lerner emails with regard to not only the 
ones you have about determinations, but Lois Lerner emails with 
regard to the examination process, the appeals process, and, to 
the extent there are any, with regard to the development of the 
proposed regulations that were issued.
    Those were the issues that have been raised, concerns about 
what her involvement was. We have committed that we will 
provide those to you. We have not said we are not going to 
provide you the rest of them. We have prioritized trying to 
complete document production so that we would be able to get 
you the information that we thought would be appropriate for 
the determination process. As I said in my letter to you, if 
you now want to actually run an investigation of the other 
areas with those employees or others, we are prepared to work 
with you. As I say, if you just want all the documents, once 
redacted, no matter what they are, we can give those to you, 
but I can guarantee you that you are going to go under and it 
is not going to further the investigative process. But if that 
is way you would like to do it, that will be our next priority.
    Mr. Mica. Mr. Chairman, a quick unanimous request. I would 
like this email from Cindy Thomas to appear in the record at 
this point in the proceedings, and also a copy of The 
Washington Post June 9th, Case is Closed article to appear in 
the record.
    Chairman Issa. Without objection, so ordered.
    Mr. Cummings. Mr. Chairman?
    Chairman Issa. Yes.
    Mr. Cummings. Unanimous request just for a minute.
    Chairman Issa. The gentleman is recognized.
    Mr. Cummings. He just said something, Mr. Chairman, and I 
want to make sure it is clear. It sounds like, Mr. Chairman, 
that he has an impression of what is being subpoenaed using 
certain lists and we have an opinion, and they don't coincide. 
Is that accurate?
    Mr. Koskinen. No. I think what has happened is the subpoena 
that was delivered to me in February said it wanted all the 
emails for a set of people. What we have been trying to do is 
all of those people, you have emails from those people with 
regard to the determination process pursuant to the search 
terms that we have been working with. The subpoena now says we 
would like them all for anything. We have now finally 
completed, although we are still working on the redaction, all 
of the production of documents regarding the determination 
process, which is what the IG report focused on. We have said 
that that is the first priority we have had. We have never said 
we are not going to provide you the rest of the documents, and 
in fact, trying to figure out the most efficient way to do it, 
we have said we will provide you Lois Lerner emails on 
everything with regard to examinations, appeals, and the 
regulatory process as it goes forward.
    And I have said when we are done with all of that, if you 
want to actually get emails, if you want them all, we will give 
them all to you, but if you want to actually take a more 
focused investigation on the regulatory process or otherwise, 
we are happy to work with you to figure how that goes. But in 
light of this chairman's view, as soon as we can finish the 
rest of these redactions and go forward, we will provide you 
volumes of emails, which many of them are going to be 
irrelevant, which is what I said in Congressman Mica's comment. 
Not that the materials you have are irrelevant; the ones you 
are likely to get in volume are irrelevant. And if you want it 
without any selective process, we will redact them. There are 
going to be thousands of pages and we are happy to provide them 
to you, but it is not going to expedite the conclusion of this 
investigation and, as I say, a significant part of it is going 
to be irrelevant.
    Mr. Cummings. Thank you very much, Mr. Chairman.
    Chairman Issa. For the gentleman, because it is a good 
question, one of the reasons that we requested all is that, 
back when we were in the minority, we began digitally 
evaluating this kind of information, and when we have all, and 
the ones that the commissioner is talking about, if they are 
irrelevant, then, quite frankly, there is no redaction because 
if they don't have 6103, there is no redaction appropriate. If 
that is the case, we do search terms and we look at only what 
we need to look at. But we can constantly search and research 
to try to get to the bottom of it.
    As you can imagine, we would not have found Lois Lerner 
talking to her daughter about overtly partisan political 
activity if we had only looked for determination. It wasn't 
relative to determination, but it was relative to possible 
motivation. The IG, as you know, was not aware of the speech at 
Duke University in which it was clear that Lois Lerner was 
saying in pretty plain terms that she was going to act on what 
the FEC couldn't act on. So this is part of the investigation; 
it is the reason we have asked for all. And, quite frankly, it 
takes a lot less time to just go through and view these things 
and say, oh, that has no 6103, and you just start sending it. 
And that is what we had hoped for when we issued the subpoenas 
for all, because these are people, as you know, who have said 
things before our committee, or failed to say things in some 
cases, in which they become what law enforcement might call a 
person of interest; and Lois Lerner and Holly Paz and so on, 
and the other individuals, are people of interest because of 
their possible role.
    Mr. Cummings. So, in other words, any email with anybody, 
talking to their daughter, if there is any relevance 
whatsoever, if they say I just don't like Democrats, I mean, in 
any way you could connect that with an investigation, and they 
are talking to their daughter.
    Chairman Issa. I appreciate that, but remember----
    Mr. Cummings. I am just trying to make sure I understand.
    Chairman Issa. I just want to make sure of the context. 
These are Government emails from a Government account, back in 
and out. This is the use of IRS assets to communicate. We would 
presume that the majority of it is not shopping online. As a 
matter of fact, in the case of Lois Lerner, she did her 
shopping online in a Hotmail account, which she also did 6103 
material on. So, in a normal case this would not be something 
you would look through. And the Department of Justice, if they 
are actually doing the investigation they claim to, we have an 
obligation to look and figure out whether we can opt out these 
communications, which in this case were always the product of 
the Government, always available and, as you know, it is a 
given that communication on Government computers is in fact 
open to Government review.
    Mr. Cummings. I just wanted to make sure the public 
understands that.
    Chairman Issa. Thank you.
    Mr. Connolly.
    Mr. Connolly. Thank you, Mr. Chairman. I would say to the 
ranking member it sounds like his understanding is correct. And 
I would hope we would do the same with, oh, I don't know, the 
IG, Mr. Russell George. I would like to see all of his overt 
partisan political emails. I would like to see if he has 
emailed relatives, if he has emailed staff members of this 
committee. I think that would be relevant to putting in context 
his findings and to determining whether he, in fact, is an 
objective source of information and analysis. But that is a 
different matter.
    Mr. Koskinen, as I read the Declaration of Independence, it 
is written largely initially, the first draft, by Thomas 
Jefferson, but it was subject to an editorial committee. He 
didn't like that; he thought his words were pretty good. Among 
those words were Americans were entitled to life, liberty. Now, 
here the editorial committee did not act. He said and the 
pursuit of happiness. But it sounds like some people would 
substitute for that an unfettered and unquestioned access to 
501(c)(3) and 501(c)(4) tax exempt status. Do you read that in 
the Declaration of Independence, Mr. Commissioner?
    Mr. Koskinen. I never thought of it that way, but I don't 
read it that way, no.
    Mr. Connolly. No, it doesn't read that way. So it is not 
really an explicit entitlement or right; it is a process you 
have to qualify for, is that correct?
    Mr. Koskinen. Correct.
    Mr. Connolly. There are many different ways of trying to 
figure out how somebody qualifies and whether they qualify, is 
that correct?
    Mr. Koskinen. Yes.
    Mr. Connolly. And, by and large, historically, IRS has had 
a standard operating procedure for determining that status, 
either 501(c)(3) or 501(c)(4) or other status, is that correct?
    Mr. Koskinen. Correct.
    Mr. Connolly. In this particular case, what we are all 
excited about is that a filter was created in a regional office 
that seemed to target people for their political views, both 
right and left, but apparently mostly right, is that right?
    Mr. Koskinen. As noted, the inappropriate criteria used 
primarily the name of the organization to select them for 
further review.
    Mr. Connolly. Now, one of the problems we have here is an 
adverb. The word used in the statute is exclusively; a social 
welfare exclusively devoted to that purpose, is that correct?
    Mr. Koskinen. That is correct.
    Mr. Connolly. And yet, despite the fact that Congress wrote 
that adverb into the law, IRS took upon itself, long before 
your tenure, to actually interpret that meaning primarily, is 
that correct?
    Mr. Koskinen. That is correct.
    Mr. Connolly. Now, if I said to my spouse, honey, we have 
an exclusive relationship, and I mean by that 49 percent, I 
would probably have problems in my relationship. To her and to 
me exclusively means just you all the time, 100 percent. So how 
in the world did we get to a situation where the IRS, on its 
own, outside of statutory authority, decided to interpret this 
as primarily? Because, to me, that is part of the problem. 
Exclusively ought to mean exclusively. And if Congress wants to 
change that, we should change the law. But I don't remember 
Congress investing IRS with the authority to actually decide to 
interpret it radically different, not just kind of a little 
fudge factor here. This is radically different. And it seems to 
me therein is the problem, because clearly some of these 
organizations are not exclusively social welfare agents, I 
mean, clearly, they are largely designed to be political, 
partisanly political, that concern the chairman has, overt 
partisan communication, and I share that concern. And all too 
many of these organizations hide under the umbrella of social 
welfare when in fact what they really mean is partisan 
political activity. Can you address this dilemma for me, how 
the IRS could possibly take the word exclusively and 
reinterpret it to mean mostly, sometimes, just shy of 50 
percent, primarily?
    Mr. Koskinen. Needless to say, I wasn't around in 1959, 
when that regulation was given to the IRS.
    Mr. Connolly. Which is stipulated.
    Mr. Koskinen. One of the reasons, in response to the 
inspector general's recommendation that clarification be 
provided, that the draft regulations were issued for comment 
was to in fact solicit discussions about what the definition of 
political activity ought to be, how much of it ought to be 
allowed before you jeopardize your tax exemption or are 
ineligible for tax exemption, and to which organizations in the 
501(c) complex should that be applied. The 150,000 comments 
address all three of those issues. The proposed draft was 
designed to in fact review and revisit with the public and with 
comments and with Congress exactly that issue, what should 
exclusively really mean.
    Mr. Connolly. Thank you. My time is up.
    Mr. Chairman, I certainly hope, after all the storm and 
drum of this issue, we actually might come together in a 
bipartisan basis.
    Chairman Issa. I certainly hope so, and I hope the 
gentleman remembers that 501(c)(4)s are not tax exempt to the 
contributor, so they really are no different than any 
corporation that spends all of its money doing anything. But it 
is an interesting question of what social welfare was in 1959 
and whether promoting a reduction in smoking or something else 
would have been considered political prior to the creation of 
the Federal Election Commission.
    Mr. Connolly. And you know, Mr. Chairman, if I may, to your 
point, we may even decide, frankly, look, let's just have a new 
category. You want to be political and you want to hide who 
your donors are, hopefully you don't, there is this category, 
so that we are not playing, frankly, with words and, in the 
sense, all being complicit in this disingenuous exercise. So I 
take the chairman's point and would add to it. Thank you.
    Chairman Issa. I thank the gentleman.
    We now go to the gentleman from Ohio, Mr. Jordan.
    Mr. Jordan. Thank you, Mr. Chairman.
    Mr. Koskinen, what part of all don't you and the IRS 
understand? You have said like ten times now if you give us all 
Lois Lerner's emails, we are going to get irrelevant 
information. Frankly, with all due respect, we don't care what 
you think is irrelevant. The committee has asked for every 
single--I asked for it clear back in August from Danny Werfel 
and he told me the same thing you did; we are trying, we are 
hoping, we are going to get there someday, sometime. We want 
them all. Because if you limit it to what you said earlier, to 
determinations, appeals, exams, and rulemaking, just those 
categories, what if there is an email to Lois Lerner from the 
White House that says, Hey, Lois, keep up the great work, we 
appreciate what you are doing? What if there is that kind of 
email? That wouldn't fit under the categories and the search 
terms that you are talking about. When we say all, we want 
every single email in the time period in the subpoena that was 
sent to you, plain and simple.
    Now, let me ask you this. You agree with the TIGTA audit 
report that came out, you agree there were problems and you are 
trying to comply with the TIGTA audit report, is that accurate, 
Mr. Koskinen?
    Mr. Koskinen. That is correct.
    Mr. Jordan. All right, I would like to put up slide one.
    [Slide.]
    Mr. Jordan. These are inappropriate criteria and questions 
that were sent out to Tea Party groups that TIGTA identified as 
going too far, inappropriate things asked: issues that are 
important to the organization, things asked that the 
organization indicate positions regarding such issues, type of 
conversations you have in your meetings. Inappropriate 
questions you concede that are highlighted there.
    Second slide.
    [Slide.]
    Mr. Jordan. This is Judith Kendall, email that she sent to 
Holly Paz. Judith Kendall, Senior Technical Advisor to Lois 
Lerner. Same list, talking about how these were inappropriate 
questions that were asked of Tea Party groups.
    Now we move to the proposed rule that has got so much 
controversy. I think approximately 150,000 comments, more 
comments than any other rule that the IRS has ever proposed, is 
that accurate, Mr. Koskinen?
    Mr. Koskinen. Actually, if you take all the comments for 
the last seven years and double them, and you get to that 
number.
    Mr. Jordan. Yes. And is it fair to say the vast majority of 
those comments are negative?
    Mr. Koskinen. I have no idea; they are being analyzed right 
now.
    Mr. Jordan. Based on what we have heard, based on the 
hearing we had just a few weeks ago, where we had the ACLU and 
the Tea Party all saying this thing stinks and we shouldn't 
have it, vast majority of those, I am going to hazard a guess, 
are negative comments.
    If we could go to the third slide now.
    [Slide.]
    Mr. Jordan. Now, this is a newsletter that came out just 
three weeks ago. IRS Exempt Organization Newsletter, March 4, 
2014. Are you familiar with this newsletter that goes out from 
the Exempt Organizations Division of the Internal Revenue 
Service?
    Mr. Koskinen. I do not see those.
    Mr. Jordan. Okay. Well, this is put out by the Exempt 
Organizations Division, same division where all these problems 
took place over the last three years. It came out, again, just 
five days after the comment period on the proposed rule ended 
at the end of February, and I want to just highlight a few of 
the questions that are asked. So there is a category that says 
what if the IRS needs more information about your (c)(4) 
application? New sample questions. So if we could put them up 
side-by-side.
    Now, the first slide are the targeted questions that TIGTA 
said were inappropriate and that you agree are inappropriate, 
Judith Kendall agreed are inappropriate. Those are those 
questions. And now, just five days after the proposed rule 
comment period ends, you issue a newsletter from the Exempt 
Organizations Division highlighting the new questions you are 
going to ask, and I just want to look how similar the two 
questions are.
    Let's just take the second category, whether an officer or 
director, etcetera, has run or will run for public office. The 
new question says this: Do you support a candidate for public 
office who is one of your founders, officers, or board members? 
It is basically the same. This reminds me of when I was in 
grade school and the teachers told us you shouldn't plagiarize, 
so you change a few words and basically plagiarize. This is the 
same thing.
    So here is what I don't understand. If you are trying to 
comply with the TIGTA report, if the new (c)(4) rule is a way 
to deal with what the audit said and not as what I believe is a 
continuation of the project Lois Lerner started, why are you 
asking the same darn questions?
    Mr. Koskinen. As I noted, I haven't seen that and can't 
read it on the chart. I would be delighted to sit down and go 
over all of those questions with you and with the exempt 
organizations. All of the TIGTA report didn't blanket say you 
should never ask questions about this. Thank you for the chart.
    Mr. Jordan. Let me read from your testimony, Mr. Koskinen. 
Page 7 of your testimony that you submitted to the committee 
yesterday, talking about our notice of proposed rulemaking is 
consistent with the TIGTA recommendations. You said this in 
your testimony you gave the committee.
    Mr. Koskinen. Well, okay, I am just----
    Mr. Jordan. And yet consistent with TIGTA recommendations. 
TIGTA said these kind of questions are inappropriate, and now, 
just three weeks ago, Exempt Organizations Division issues a 
newsletter where you are asking almost verbatim, a few word 
changes so you don't look just like you are totally 
plagiarizing or doing the exact same question, almost 
verbatim----
    Mr. Koskinen. I don't think they are exact----
    Mr. Jordan.--the same darn questions.
    Mr. Koskinen. I don't think they are--the first question 
says, Provide a list of all issues that are important to your 
organization and indicate your position regarding those. The 
new question says, Describe how you prepare voter guides.
    Mr. Jordan. What do you think voter guides are about? They 
are about issues. They are about the issues important to 
organizations. It is the same thing.
    Mr. Koskinen. I think----
    Mr. Jordan. Have you ever seen a voter guide? I have. I 
would be able to answer those questions.
    Mr. Koskinen. I would submit and I appreciate----
    Mr. Jordan. As a candidate, I have answered those.
    Mr. Koskinen. I would submit and I appreciate having a copy 
of this, that if I look at the first question and the revision, 
the revision is very different than the----
    Mr. Jordan. Very different.
    Mr. Koskinen. Very different.
    Mr. Jordan. Oh, yeah, right.
    Mr. Koskinen. Look at the third question: What type of 
conversations and discussions did your members and participants 
have during the activity? That is now, Describe how you 
determine what questions to ask of candidates. It doesn't say 
anything about what discussions or conversations your member 
had, including the scope of the----
    Mr. Jordan. You think they don't discuss it?
    Mr. Koskinen. It doesn't ask for your conversation. It 
doesn't say what your participants are.
    Mr. Jordan. Okay, you defend that.
    Mr. Koskinen. It specifically says----
    Mr. Jordan. You defend that and you defend the statement 
that you are complying with the proposed rulemaking is 
consistent with the TIGTA recommendations. I don't think it is.
    Mr. Koskinen. That is fine.
    Mr. Jordan. What I know is the same day this comes out, you 
send me a letter, our primary goal, same day, March 4, 2014, 
letter to me, you responded to a letter we had sent to you; one 
of my primary goals and responsibilities is to restore whatever 
public trust has been lost over the course of the last several 
months, and yet you are asking almost, almost the same 
questions that your people said were inappropriate to ask Tea 
Party groups when all the targeting took place. And now, as a 
response to the new (c)(4) rule, oh, we have changed the 
questions a little bit.
    Mr. Koskinen. I think if you ask an organization 
independently which are the questions, have there been changes, 
I think that these are new questions; they do not probe the 
discussions you had, the conversations you had, they didn't 
disclose your position on the issues. These are in fact new 
questions. Now, we may have a difference----
    Mr. Jordan. I think we disagree.
    Mr. Koskinen. That is fine.
    Mr. Jordan. And I think the vast majority of people who 
were harassed over the last three years would agree with my 
position.
    Mr. Chairman I yield back.
    Mr. Koskinen. I am happy to have this in the record and let 
the public decide whether or not we have responded 
appropriately.
    Mr. Jordan. Oh, let me ask you one other question.
    Chairman Issa. The gentleman's time has expired. I 
apologize.
    We now go to the gentleman from Missouri, Mr. Clay.
    Mr. Clay. Thank you, Mr. Chairman.
    Commissioner, Chairman Issa wrote a letter to you 
yesterday, complaining that you were guilty of a failure to 
comply with the committee's demands for documents. He also 
said, ``Your continued noncompliance with these requests also 
contravenes your pledge to fully cooperate with congressional 
investigations.'' So even though you have already produced more 
than 400,000 pages to the committee, even though you have 250 
employees working on producing more, he accuses you of 
violating your pledge and frustrating congressional oversight. 
I think this is shameful and it is even more so when you 
actually look at the unbelievably broad demands the chairman 
has made.
    Lets look at just one of these demands. Number 8 in Mr. 
Issa's letter, it demands the following: ``All documents 
referring or relating to the evaluation of tax-exempt 
applications or the examination of tax-exempt organizations 
from January 1, 2009 to August 2nd, 2013.'' Let me read that 
again: All documents from 2009 to 2013, nearly four years, 
referring or relating in any way to tax-exempt applications.
    Mr. Commissioner, how broad is this request?
    Mr. Koskinen. That request will get you not thousands, but 
probably millions of documents. The chairman has been focusing 
on emails, but you are exactly right, the full sweep of the 
subpoena will mean that we will be at this for months, if not 
years, collecting that information, redacting it, and then 
providing it.
    Mr. Clay. Let me ask you this. The evaluation of tax-exempt 
applications is the function of the Exempt Organizations 
Division of the IRS. It is my understanding that about 800 
people work in the Division, is that correct?
    Mr. Koskinen. That is correct.
    Mr. Clay. So the chairman has gone on national television 
and threatening you with contempt unless the IRS produces every 
document produced by 800 people over nearly a four-year time 
period. Mr. Commissioner, even if you wanted to comply with 
this demand, how long would you estimate that it would take the 
IRS to complete this document production?
    Mr. Koskinen. We have already spent 10 months, $15 million, 
and add 100,000 hours and 250 people working to produce the 
documents that we in fact agreed with the committee would be 
relevant. This is a much broader, more sweeping request to all 
of those documents, and I have continued to press our people, 
because I am anxious to get documents to the committees and 
investigators as fast as possible, how long it would take even 
to complete the redaction, and I cannot get a clear answer 
because it is a very complicated, difficult process. My guess 
is there is no way we would get you this information totally 
before the end of the year.
    Mr. Clay. Wow. To me, this shows how our committee has 
moved from government oversight to government abuse. These 
ridiculous demands are not only over-broad and irrelevant, but 
they will force the IRS to continue wasting its precious staff 
and financial resources.
    This is about being reasonable and demanding documents 
within reason, and I don't get that sense from this committee 
that we are going in that direction. I think we are going in 
the opposite direction. To me, this is a partisan witch hunt 
which has already cost the IRS more than $14 million, and 
compliance with these outrageous requests will only cause that 
number to continue to grow, and it certainly doesn't reflect 
good oversight, Mr. Chairman, and I am really appalled that 
this investigation has gone to this level.
    Chairman Issa. Would the gentleman yield?
    Mr. Clay. I certainly do.
    Chairman Issa. Do you feel that asking for all of Lois 
Lerner's emails so that we can search through to see whether or 
not she inappropriately was in fact actively doing more than we 
already know? Do you think that is inappropriate?
    Mr. Clay. I don't have a problem asking for Lois Lerner's 
email, but I do have an issue with asking for 800 people's 
emails. I mean, are all 800 connected to this investigation?
    Chairman Issa. Well, like I say, we haven't received all of 
Lois Lerner's emails, which is one of the things we asked for.
    Mr. Clay. Can we be more specific about what we are looking 
for for Lois Lerner, from her emails?
    Chairman Issa. No, we cannot. The gentleman's time has 
expired.
    We now go to the gentleman from Utah, Mr. Chaffetz.
    Mr. Chaffetz. I thank the chairman.
    Commissioner, thank you for being here. I have a copy of 
the subpoena that you were issued. You did receive this 
subpoena, correct?
    Mr. Koskinen. Yes.
    Mr. Chaffetz. The date on this is February 14th.
    Mr. Koskinen. Correct.
    Mr. Chaffetz. You understand what it means? Is there any 
question on what it means?
    Mr. Koskinen. I don't think so.
    Mr. Chaffetz. Do you believe it was duly issued by the 
House of Representatives?
    Mr. Koskinen. I am assuming that. I have no independent 
basis for determining that.
    Mr. Chaffetz. The schedule, which is just eight items, all 
communications sent or received by Lois Lerner from January 
1st, 2009 to August 2nd, 2013. Is there any ambiguity in your 
mind? Do you have any doubt as to what that means?
    Mr. Koskinen. No. If you want to go through all eight, I 
have no doubt what any of them mean. As noted, some of them 
mean you are going to take months or years to get the 
information and it is going to be voluminous. But there is no 
doubt about it.
    Mr. Chaffetz. So you have no ambiguity about what it means. 
You believe it has been a duly issued subpoena.
    Mr. Koskinen. Right.
    Mr. Chaffetz. And you have not complied with it, is that 
correct?
    Mr. Koskinen. There is physically no way anyone could have 
complied between February 14th and now. We have never said we 
won't comply. We have said, in fact, we are----
    Mr. Chaffetz. Are you going to comply or not?
    Mr. Koskinen. We are complying. And I will tell you to 
comply with this----
    Mr. Chaffetz. No, no, no.
    Mr. Koskinen.--you will be next year, you will be next year 
still getting documents.
    Mr. Chaffetz. Commissioner, what email system do you use 
there at the IRS?
    Mr. Koskinen. What email system do we use?
    Mr. Chaffetz. Yes. It is Outlook?
    Mr. Koskinen. Yes. We have, actually, Microsoft. At least I 
have Microsoft Office.
    Mr. Chaffetz. So you have Microsoft. So you go on there and 
you want to find all the items you sent under your name. How 
long with that take?
    Mr. Koskinen. Well, it would take a while because they are 
not all on my computer, they are all stored somewhere.
    Mr. Chaffetz. Okay. But your IT specialists, how long do 
you think it takes, of the 90-plus thousand employees there at 
the IRS, how long would it take to find all the emails that 
included her email address?
    Mr. Koskinen. Just Lois Lerner's alone?
    Mr. Chaffetz. Just Lois Lerner. Just Lois Lerner.
    Mr. Koskinen. It would take a while. We would have to----
    Mr. Chaffetz. Like how long?
    Mr. Koskinen. Well, there are millions of emails.
    Mr. Chaffetz. Minutes?
    Mr. Koskinen. Minutes? I don't know, but I don't think it 
is minutes.
    Mr. Chaffetz. I mean, that is one of the brilliants of the 
email system, is you go in and you check the Sent box and the 
Inbox, and you suddenly have all the emails, correct?
    Mr. Koskinen. Right. They get taken off and stored in 
servers, and you have 90,000 employees and you have people----
    Mr. Chaffetz. I know, but I am not asking you to search; I 
am asking you to find one. They type in her email address.
    Mr. Koskinen. We could find and we in fact are searching. 
We can find Lois Lerner's emails.
    Mr. Chaffetz. In how long? How long would that take?
    Mr. Koskinen. I have no idea how long.
    Mr. Chaffetz. Would it take a day?
    Mr. Koskinen. I just said I have no idea.
    Mr. Chaffetz. Well, I just don't understand. You have a 
duly issued subpoena. If you were in the private sector and 
somebody was issued a subpoena and you didn't comply with it, 
what would happen to you?
    Mr. Koskinen. For this subpoena, the court would actually 
rule that it is far too broad----
    Mr. Chaffetz. Oh, so you are going to make the 
determination.
    Mr. Koskinen. You asked the question. Let me answer the 
question. In a court of law, if you provided that subpoena, a 
judge would not enforce it because it is----
    Mr. Chaffetz. Wait, wait, wait. Now, stop, stop, stop right 
there. So you are going to be the judge.
    Mr. Koskinen. I am not being the judge; I am just telling 
you what would happen.
    Mr. Chaffetz. Yes, you are.
    Mr. Koskinen. You asked me what would happen.
    Mr. Chaffetz. You have a duly issued subpoena. Are you or 
are you not going to provide this committee the emails as 
indicated in this subpoena, yes or no?
    Mr. Koskinen. We have never said we weren't----
    Mr. Chaffetz. I am asking you yes or no.
    Mr. Koskinen. We are going to respond to the subpoena----
    Mr. Chaffetz. No, no. Sir----
    Mr. Koskinen. Yes, we are going to respond to the subpoena. 
I am just telling you to respond fully to the subpoena, we are 
going to be at this for years, not months. That is the only 
thing I would like to----
    Mr. Chaffetz. And I don't understand that. Just specific to 
item one, Lois Lerner----
    Mr. Koskinen. Lois Lerner's emails----
    Mr. Chaffetz. Sir, are you or are you not going to provide 
this committee all of Lois Lerner's emails?
    Mr. Koskinen. We are already starting----
    Mr. Chaffetz. Yes or----
    Mr. Koskinen. Yes, we will do that.
    Mr. Chaffetz. Yes. And then by when? When could we have 
that?
    Mr. Koskinen. I can only tell you it is going to take me, 
my group, I asked this question the other day, just to get you 
the Lois Lerner emails, redacted, because you have to get them 
redacted, for examinations, appeals, and----
    Mr. Chaffetz. No, no, no, no.
    Mr. Koskinen. You asked the question.
    Mr. Chaffetz. Is that what the subpoena says?
    Mr. Koskinen. Would you like to hear the answer to the 
question?
    Mr. Chaffetz. No. I would like to know if you are going to 
fully comply with the subpoena; not your version of the 
subpoena, the actual subpoena.
    Mr. Koskinen. You asked me how long it would take to 
respond to the Lois Lerner emails. I am explaining to you why 
it is going to take time just to respond to the 
categorization----
    Mr. Chaffetz. I don't want you to redact it. I don't want 
you to take the certain categories that you want. That is not 
what this duly issued subpoena says.
    Mr. Koskinen. I am telling you just to supply the Lois 
Lerner emails, which we are going to supply for examinations--
--
    Mr. Chaffetz. No, no, no, no, no.
    Mr. Koskinen. Can I answer the question?
    Mr. Chaffetz. That is not--no, sir. When it says all 
emails, why are you qualifying them? Under what authority do 
you change this subpoena?
    Mr. Koskinen. I was not qualifying. You were asking how 
long it was going to take and I was giving you an example of 
why it is going to take a long time, because we have to redact 
out of those emails all of the 6103 information. We are working 
very hard to get you the Lois Lerner emails. It is going to 
take you several weeks to get you the Lois Lerner emails for 
examinations, appeals----
    Mr. Chaffetz. Wait, wait, wait. Why are you getting us just 
for--it would be easier to just give them to us all, right?
    Mr. Koskinen. No, it would just take a lot longer because 
we have to redact the rest of them. We actually selected those 
because in a letter from the Ways and Means Committee also 
saying they need help, they focused on what they are looking 
for is those categories, so prioritizing we said we would 
provide both committees with those categories.
    Chairman Issa. The gentleman's time has expired.
    Mr. Koskinen. We are happy to provide you the rest of 
them----
    Mr. Chaffetz. I am yielding back, but this commissioner has 
no intention of fully complying with this duly issued subpoena. 
That is the case. That is where both of us, on both sides of 
the aisle, need to stand up for the integrity of the House of 
Representatives.
    Mr. Cummings. Mr. Chairman?
    Mr. Chaffetz. When you have a duly issued subpoena, you 
comply with it. It is not optional.
    Mr. Cummings. Mr. Chairman?
    Mr. Koskinen. May I----
    Chairman Issa. The gentleman's time has expired.
    The gentleman from Maryland.
    Mr. Cummings. I ask unanimous consent just for a minute.
    Chairman Issa. The gentleman's unanimous consent for one 
minute.
    Mr. Cummings. Mr. Chairman, I never heard the commissioner 
say that he was not going to obey the subpoena. As a matter of 
fact, that is all he has been saying.
    Chairman Issa. Actually, if the gentleman would yield, he 
has, on every single question, failed to say, yes, I will give 
you all the emails. He has gone into the ones that he is 
prepared to give, the ones that he could give to Ways and Means 
in an hour, because once you do the search you just dump it to 
them. And even then he said that those would take--the ones 
that he says he is going to give us he said it would take a 
couple weeks and, of course, the subpoena is many months old.
    Mr. Cummings. Well, reclaiming just for a second. I just 
want us to be clear. I mean, time is precious, money is 
precious. Just tell us. I mean, you talk about relevance. You 
said if a lawyer were to see this subpoena, they would have 
some concerns. I just want to be clear. I mean, it sounds like, 
again, I am saying what I said before, you seem to have an 
understanding and we seem to have an understanding, and they 
don't seem to be the same. So are you going to provide the 
documents for Lois Lerner?
    Mr. Koskinen. Yes.
    Mr. Cummings. That were subpoenaed.
    Mr. Koskinen. Yes.
    Mr. Cummings. And how long will that take?
    Mr. Koskinen. I do not know. It know it is going to take us 
several weeks, I asked that question yesterday, simply for the 
categories we are already working on, and I was told that to 
redact those will take us several weeks longer. It will take us 
much longer than that, but we will provide them. And I have 
said with regard, notwithstanding the congressman who has now 
departed view that we are not going to comply, we are going to 
comply. We never said we wouldn't comply. We are simply trying 
to help refine the search so that, in fact, we could get this 
done sometime in the near future, that is, this year. But at 
the rate we are going, as noted by an earlier question, if you 
want all the categories of all the applications of everybody 
who has been through the (c)(4) process for the last four 
years, we can do that, and we will do that, but it is going to 
take years.
    Mr. Cummings. Very well. Thank you.
    Chairman Issa. I thank the gentleman. I thank you for your 
questions, but hopefully we all understand that asking for all 
the emails, the ones that you seem to be least willing to put 
first are the ones that probably have no 6103. They are very 
quick to go through and somebody simply looks and says, oh, she 
is talking to an outside entity; by definition, there can't be 
any 6103 there, right?
    Mr. Koskinen. Correct. All the ones that are easy are easy; 
the ones that are difficult are difficult. And there are more 
of the difficult ones than we would all like.
    Chairman Issa. Of course, the ones that the gentleman was 
asking for before he had to leave were the ones that were not 
being given, which, by definition, very often are easy.
    Mr. Koskinen. Right. And I would just note for the record 
that all of the Lois emails we are talking redacting have been 
provided already to the House Ways and Means Committee and the 
Senate and Finance Committee, because they don't have to be 
redacted. So there has been no question there about, in fact, 
the fulsome response.
    Chairman Issa. Thank you.
    The gentleman from Massachusetts, Mr. Lynch.
    Mr. Lynch. Thank you, Mr. Chairman.
    Commissioner, just to take this from the top, the probative 
depth of our inquiry usually depends on the importance of the 
information that we seek and also the danger that we are trying 
to expunge, and I have to admit there is a deficit of trust 
here between the Congress, many of its members, and the IRS on 
this issue, and that is because, on its face, there has been an 
admission here that the IRS, a very, very powerful Government 
agency, has inappropriately targeted United States citizens for 
enhanced scrutiny, some would say harassment and denial of 
statutory and constitutional rights based on their own 
political views. That is why my colleagues are after this 
information. That is why many of us on this side are after this 
information, so it is incredibly important. So when we say we 
need all of the emails, in a normal circumstance, in a normal 
case you might have a judge say that is overly broad, but in 
this case, in this case, whether the taxpayer was a Tea Party 
or was occupy whatever, a progressive group, the fact that the 
IRS, a very powerful agency with a lot of information on a lot 
of individuals here, is now targeting or has been targeting 
U.S. citizens, that is serious stuff, and I think that 
justifies the scope of this committee's inquiry and the urgency 
that we get to the bottom of this.
    Now, that is not just good for Republicans, that is not 
just good for Democrats; that is good for our democracy here. 
So this is a very, very serious issue. You know, in his seminal 
work, Congressional Government, President Woodrow Wilson 
described the oversight function of Congress as follows. He 
said, Quite as important as legislation is vigilant oversight 
of the administration. It is the proper duty of a 
representative body to look diligently into every affair of 
Government and talk much about what it sees. It is meant to be 
the eyes and the voice, and to embody the wisdom and will of 
its constituency.
    In fulfillment of this solemn duty to inform the American 
people, it is imperative that we as legislators and members of 
this committee conduct robust oversight when we receive reports 
that a powerful Government agency has subjected American 
citizens to excessive scrutiny based on unwarranted and unjust 
criteria. Certainly no American citizen should have their 
constitutional and statutory rights withheld by the Government 
on the basis of their political affiliation, or simply because 
they criticized the way that the Government is being run, and 
any reports to that effect clearly warrant meaningful 
congressional oversight.
    And that is why I have, in the past and today again, 
supported the extensive investigation conducted by this 
committee and to the targeting of certain applicants for tax-
exempt status.
    Now, regrettably, this investigation has thus far been 
guided primarily by politics and partisanship, rather than a 
genuine commitment to fully inform the American people as to 
how these troubling events at the IRS unfolded. In particular, 
the chairman has routinely released to the American public only 
partial excerpts of the transcripts from transcribed interviews 
conducted by both of our staffs with the relevant IRS 
officials, and most recently the chairman again released a 
staff report on the committee's investigation without first 
soliciting input from our side of the aisle, after denying a 
request by our ranking member to share the report with 
Democratic members and minority staff prior to its release.
    So I understand the importance of this inquiry, I really 
do. I think it is incredibly important. But I also think that 
we have missed the opportunity here because of the chairman's 
very partisan and one-sided approach to this hearing, and I 
think it has hurt the American people because I think it is 
incredibly important that we get to the bottom of this, but 
because it is being fumbled, this opportunity is being fumbled, 
we are not getting the answers that we need. But I do support 
the idea that our inquiries necessarily have to be very broad 
and deep because of the danger we are trying to excise here. We 
want to send a message to the IRS that you don't do this to our 
people. You do not do this to American citizens. You do not 
target people because of their political views or because they 
complain about the Government. I complain about the Government 
and I am part of the Government. So that is a precious freedom 
that we need to protect, and the IRS, in its recent approach, 
is threatening that very freedom and that is a danger that we 
have to be together in opposing on both sides of the aisle.
    I yield back the balance of my time.
    Chairman Issa. I thank the gentleman.
    We now go to the gentleman from Michigan, Mr. Walberg.
    Mr. Walberg. I thank the chairman.
    Mr. Koskinen, are you aware that your predecessor, Doug 
Shulman, in a testimony to Congress in March of 2012, gave very 
strong assurances that the IRS was not targeting conservative 
tax-exempt applicants?
    Mr. Koskinen. I am aware of that.
    Mr. Walberg. Just for the record, his statement where he 
testified, ``First, let me start by saying yes, I can give you 
assurances. As you know, we pride ourselves on being a 
nonpolitical, nonpartisan organization, and so there is 
absolutely no targeting. This is the kind of back and forth 
that happens when people apply for 501(c)(3)(4) status.''
    That was what he said. Do you think that Mr. Shulman's 
testimony was accurate?
    Mr. Koskinen. I don't know what Mr. Shulman knew, what his 
relationship to the Exempt Organization Department is, so----
    Mr. Walberg. But was his statement accurate?
    Mr. Koskinen. The statement may have been very accurate 
from the standpoint of what he knew. From the standpoint of the 
improper use of improper criteria, obviously, as the inspector 
general noted, in the determination process inappropriate 
criteria were used.
    Mr. Walberg. Was it complete and forthcoming as it should 
have been?
    Mr. Koskinen. Again, I don't know what Mr. Shulman knew. 
What I have done is I----
    Mr. Walberg. From your perspective right now.
    Mr. Koskinen. From my perspective, I have no way of knowing 
what he knew or didn't know.
    Mr. Walberg. From your perspective, was the information 
accurate? Not what he thought, but what you know right now.
    Mr. Koskinen. From what I know right now, as a result of 
the IG report, I know that inappropriate criteria were used to 
select organizations for review in the determination process.
    Mr. Walberg. Can you give assurances--and I refer back to 
my colleague, Mr. Jordan from Ohio, when he listed a number of 
agencies and entities that have great concern about what has 
gone on with IRS that we know now took place, such as home 
school--I am a home schooler, my family; I am a life member of 
the American Motorcyclists Association; I am a member of HOG, 
Harley Owners Group; I am an NRA charter member, Tea Party 
caucus member here in Congress, member of Right to Life. And I 
could go on with organizations, but my question is can you give 
us assurances here and now that the IRS is no longer targeting 
conservatives or treating conservative groups differently than 
any other applicants?
    Mr. Koskinen. I can give you assurances that I am committed 
and I am confident the agency is committed to not 
discriminating against any organization or any individual no 
matter what their organizational capacity, what their political 
beliefs are, who they voted for in the last election. If you 
deal with the IRS, you have a right, and I agree with the 
earlier comments, you have a right to assume and you need to be 
protected to assume that you are going to be treated the same 
way everyone else is treated----
    Mr. Walberg. Absolutely. And our concern is that Mr. 
Shulman gave us that same certainty in his testimony in front 
of us.
    Mr. Koskinen. I don't know how he ran the organization. I 
have just been to 16 of the largest 25 IRS offices. I have 
listened personally to over 7,000 employees, and my message to 
them has been that, going forward, we need to have information 
flow from the bottom of the organization to the top, and if 
there is a problem I need to know about it because we will fix 
it.
    Mr. Walberg. Great. Let's go with that. Let's go with that, 
that testimony that you took.
    Mr. Koskinen. Let me just tell you, just to make you 
comfortable, if there is a problem, I don't know about it, then 
that is my fault, because that means I haven't created a 
culture where problems and issues get raised from front-line 
workers and go easily and freely----
    Mr. Walberg. What is the morale of the front-line workers 
now, Cincinnati and other places?
    Mr. Koskinen. Morale actually is surprisingly better than I 
would have expected in light of what has happened to Federal 
employees for four years and the IRS for the last year. I have 
found professional, dedicated, energetic employees focused on 
the mission of the agency. Their overriding concern is we don't 
have enough people to allow them to provide the services to 
taxpayers that they feel taxpayers prefer.
    Mr. Walberg. Well, they ought to feel that way, because 
they were asked and they were put in situations that didn't 
allow them to do the job that they are expected to do but, 
rather, to target conservative groups. I would be a low morale, 
and I am glad to hear you say that it is coming up, but we have 
spoken with several IRS employees during the course of this 
investigation. They have told us that Lois Lerner's 
announcement that low level people in Cincinnati were 
responsible for the conduct was a nuclear strike to them, and I 
would assume that you would agree, from what you have heard.
    Mr. Koskinen. It clearly is. As I told you, my view of 
running an organization, if there is a problem, it is my 
problem, it is not somebody else's problem; we will work on it 
together. And my sense would never be that it is not my 
responsibility. Everything that happens in that organization is 
my responsibility.
    Mr. Walberg. I am glad to hear that. Then I just again 
question, with the difficulty in getting information, what are 
we hiding at the IRS.
    Mr. Chairman, I yield back.
    Chairman Issa. I thank you.
    You answered the question partially, but the gentleman 
asked you essentially was it Cincinnati or was it Lois Lerner 
in Washington. Did you reach a conclusion on whether this was 
in fact low level people in Cincinnati or, in fact, Lois Lerner 
and possibly others in Washington that were responsible for 
what effectively became targeting?
    Mr. Koskinen. I haven't done an independent investigation; 
I have reached no conclusion about that. I am looking forward 
to the reports from the various investigations----
    Chairman Issa. But you agree with the IG's report which 
found that essentially it wasn't low level people in 
Cincinnati?
    Mr. Koskinen. I agree with the IG report in terms of the 
recommendations. In fact, in response to the earlier ones, I 
would stress to this committee that we have, in fact, adopted 
all of the IG recommendations. My commitment to people applying 
for applications now, whether it is a (c)(4), (c)(3), (5), (6), 
or (7), is that they will be treated fairly no matter who they 
are. It goes back to the earlier question. Whatever your 
political beliefs, whatever the name of your organization, you 
deserve to be treated fairly and on the same basis of everyone 
else.
    Chairman Issa. If only that were true.
    Mr. Davis is recognized for five minutes.
    Mr. Davis. Thank you very much, Mr. Chairman.
    And thank you, Commissioner. I know that we have hashed and 
rehashed and gone over and under the whole issue of the 
document requests, but I want to make sure that I understand as 
well as I can what the issues are here. The chairman says that 
he wants all of Lois Lerner's emails, not just the ones related 
to (c)(4)s, not just the ones related to tax-exempt 
applications, but all of her emails. Obviously, this would 
include emails that have absolutely nothing to do with our 
investigation. In other words, the committee is going to what I 
would call the mat, and even threatening contempt for what 
everyone agrees are irrelevant emails.
    I don't think this makes any sense, and this is not what 
the Ways and Means Committee did. The Ways and Means Committee 
worked with you to identify the emails that are relevant to our 
investigation, is that correct?
    Mr. Koskinen. That is correct.
    Mr. Davis. And if you are required to produce all her 
emails, you have to examine each and every email for private 
taxpayer information covered by 6103.
    Mr. Koskinen. That is correct. That is why we were able to 
provide the Finance Committee and Ways and Means Committee with 
all those emails last week, and why it is going to take us 
several weeks to be able to provide the committee with her 
emails going forward.
    Mr. Davis. And, of course, you cannot provide this 
committee with that information, and you would have to redact 
it.
    Mr. Koskinen. That is correct.
    Mr. Davis. If I understand this, by definition, the 
Internal Revenue Service would be wasting time and money 
producing documents that will not fulfill any investigative 
purpose. Would you say that is correct?
    Mr. Koskinen. That is what we have been concerned about.
    Mr. Davis. You know, I kind of grew up with the idea that 
you don't ride or you don't get much from riding a dead horse 
to death; that if he has already died, if everything that you 
can get out of him has been gotten, then you are wasting time 
to continue. I think that we should reconsider this misguided 
approach. We should go back to standard investigative 
procedures and develop search terms that are relevant, instead 
of this other method, which appears to be nothing more than a 
fishing expedition trying to connect some decisions to the 
White House or to some place that did not exist.
    I was very pleased to hear you indicate that the morale 
among IRS employees is at a level beyond which one might have 
expected. What would be the best utilization of your time to 
make sure that it stays where it is and goes up, rather than 
being bowed down with an irrelevant investigation?
    Mr. Koskinen. Well, I think one of the most important 
challenges we have, and we have been trying to do it with the 
six investigations going on, is to try to produce information 
as quickly as we can in an order that will allow the committees 
and the investigators to conclude their investigation, because 
I think one of the important things for not only restoring 
public confidence in the IRS, but employee morale, would be to 
come to closure on these issues.
    Whatever I have said from the start, whatever the facts are 
that each of the investigators find, we will review, we will 
respond appropriately to and move forward. No one has more 
interest in concluding these investigations promptly and in an 
orderly way than I do and than the employees of the IRS, which 
is why we will continue. We have tried to provide information 
and work with the staffs of each of the investigators to 
provide the information they need in the most appropriate 
order, but ultimately, as I have said, whatever information the 
committee wants, they have a right to get. The question is how 
long is that going to take and can we get you the most relevant 
information at the front end so you can in fact do your work.
    Mr. Davis. Thank you very much, and I yield back, Mr. 
Chairman.
    Chairman Issa. I thank the gentleman.
    Recognize the gentleman from Tennessee.
    Could I have just 10 seconds of your time?
    Mr. DesJarlais. Yes, Chairman.
    Chairman Issa. I might note for the record that, in the 
case of Lois Lerner, we delayed bringing her back in hopes that 
we would get all the emails, and obviously we didn't have them. 
She took the Fifth ten more times and we were very 
disappointed. We made that very clear, that when you have 
somebody who has taken the Fifth, I can't imagine a law 
enforcement agency or a judge saying that a subpoena relative 
to that person's government communication would be irrelevant.
    I thank the gentleman.
    Mr. DesJarlais. Thank you.
    Commissioner, thank you for being here today. We have had 
several commissioners in our presence since this story has 
broke. Commissioner Shulman, Commissioner Miller were two that 
would not acknowledge that wrongdoing had taken place and they 
would not apologize to the American people for what had 
happened. Danny Werfel did say that something wrong has gone on 
here and apologized to the American people. So I was encouraged 
to hear you say that what you know now, that you do believe 
that inappropriate criteria were used to target specific 
organizations. So at least we are to the point that we do 
acknowledge that something did go wrong, correct?
    Mr. Koskinen. Yes. Inappropriate criteria were used. I 
don't think I used the word target, but I do acknowledge that 
applications were delayed unnecessarily and for too long.
    Mr. DesJarlais. Okay. Just a housekeeping item. I was back 
home in the district last week and Rachel Killibrew, who is a 
treasurer of the McMinnville Breakfast Rotary Club, is sending 
a letter to the IRS to ask for a 501(c)(3) organization, which 
will, among other things, help alleviate childhood hunger. I 
can tell her with confidence that you don't think their group 
will be targeted or delayed?
    Mr. Koskinen. I can guarantee them they won't be--
inappropriate criteria won't be used in any way. Delays are a 
different issue. One of our big challenges is, as a result of a 
lot of other things going on, we built a backlog in the (c)(3) 
area that we are aggressively dealing with. Our goal 
ultimately, especially for smaller, local organizations, is to 
have a streamlined process that will be up and running by June. 
So I can guarantee she will get appropriate consideration. I 
wish I could promise her right now it would be very quick.
    Mr. DesJarlais. All right.
    Mr. Koskinen. By the end of this year we are going to be in 
much better shape in processing (c)(3)s.
    Mr. DesJarlais. I will pass that along. I am sure they will 
be happy to hear that.
    Our colleague, Mr. Clay, earlier called this a political 
witch hunt. Do you agree with that?
    Mr. Koskinen. I have made no judgments about any of the six 
investigations going on. I think it is important for the public 
to feel satisfied that there have been thorough investigations.
    Mr. DesJarlais. Okay.
    Mr. Koskinen. I would like to see them concluded earlier, 
rather than later----
    Mr. DesJarlais. Sure.
    Mr. Koskinen.--but we will play the hand we are dealt.
    Mr. DesJarlais. Okay, what do you think, does it kind of 
handicap this process when officials from the Justice 
Department announce that there would not be any criminal 
charges in this investigation, and this, of course, was before 
any of the witnesses had been questioned, or that the President 
goes on TV on Super Bowl Sunday and announces that there is not 
a smidgeon of corruption within the IRS? Can you agree with 
either of those things, knowing what you know now and 
depending, I guess, how you define inappropriate tactics being 
used?
    Mr. Koskinen. As I have noted in the past, I haven't done 
any independent investigation of what went on. There have been 
people across the political spectrum, in Congress, outside of 
the Congress, in this committee and other committees, making 
conjectures and judgments about what happened. My view is I am 
waiting for the investigations to be completed; we will respond 
to the facts and we will proceed.
    Mr. DesJarlais. You heard my colleague, Mr. Jordan, in his 
opening statement, he played out a pretty good timetable I 
think for anyone listening about how this has gone down. Do you 
understand the timetable that he gave and does that give you a 
lot of concern?
    Mr. Koskinen. I understand the timetable he gave. There is 
other information. You have volumes of documents. What the 
purpose of a final report is is that you would have a committee 
report, you would come up with facts as you found them. There 
may or may not be a bipartisan report, there might be 
dissenting reports; we will have several investigator reports. 
When they are done we will know what the consensus is is what 
happened. More importantly, as I have said, it is important for 
the public to know we have adopted all of the IG 
recommendations, so whatever the management failings were that 
existed have been resolved.
    Mr. DesJarlais. I think we are getting a little gun-shy on 
this committee because this scandal, the Benghazi scandal have 
been referred to as phony scandals. We know inappropriate 
targeting went on. I am afraid if Hillary Clinton were sitting 
out there, she would probably look us in the eye and say the 
President has always been re-elected; at this point, what 
difference does it make. You are not going to be that way, are 
you?
    Mr. Koskinen. I have never said it doesn't make any 
difference. My position is that this was a serious issue, it 
deserved to be treated seriously; the IRS has done that, I 
think, as a general matter, the investigators are doing that. 
As I say, again, my hope is that, as soon as possible, we can 
come to closure on it; agree on what the facts were. If there 
are additional things that need to be done, we will do them.
    Mr. DesJarlais. All right. Well, please get us the 
subpoenaed information and we can probably wrap this up much 
more quickly, and I thank you for your time.
    Mr. Jordan. [Presiding.] The gentlelady from California is 
recognized.
    Ms. Speier. Mr. Chairman, thank you.
    Commissioner, thank you. You give me great confidence in 
the work that will be transpiring relative to this evaluation. 
I must say, though, that when I think that $10 million has 
already been spent responding to inquiries by this committee, I 
am curious at how much fraud could be unearthed within the 
persons within this Country that don't play by the rules. No 
one likes the IRS. No one likes paying their taxes, but we do 
it. Most people follow the rules, but some people don't, and 
that is why you have an enforcement unit that for every dollar 
you spend there you return $9.00 to the taxpayers of this 
Country. Just speculating that if you had taken the 100,000 
hours and 250 personnel that have devoted all their time to 
complying with the endless requests by this committee, we might 
actually be doing some good in terms of the coffers that we are 
all so concerned about.
    But let me move on to the inspector general's report. We 
have studied you to death over the last year. The inspector 
general made a number of recommendations. My understanding is 
that you have complied with all of them. You have said that in 
this hearing a number of times. One of the concerns the 
inspector general did have was that IRS employees did not have 
enough training and guidance to properly handle politically 
sensitive applications for tax exemption, and I am curious, 
from your standpoint, what kind of training has now been 
provided to all of these personnel to make sure that they are 
properly trained?
    Mr. Koskinen. Well, we have provided training trying to 
give them better understanding about what is advocacy, which is 
allowed for social welfare organizations, and what is political 
intervention, which is only allowed to a minor amount so you 
don't jeopardize being primarily a social welfare organization. 
So there have been more cases developed, more examples 
developed so that people could understand better what is the 
dividing line between advocacy and political activity.
    I would note there are thousands of 501(c)(4) organizations 
that aren't advocacy or political organizations, they are 
garden clubs and civic associations and a lot of other types. 
So the vast majority of (c)(4)s, in fact, aren't involved in 
this discussion. But the question has been for the training, 
especially for new employees or relatively young employees, to 
try to give them a better roadmap as to what fits into which 
categories and how they should be approaching any application, 
no matter what the political level of activity is.
    Ms. Speier. So is this training also going to be provided 
to the screening agents?
    Mr. Koskinen. Yes. It is actually provided across the board 
and, as the IG recommended, we will renew that training before 
every election so that, again, as political activity gins up 
before a campaign and election, people will have as clear a 
roadmap under a very foggy area as possible as to what is 
social welfare allowable activity and what is political 
activity, which, if you engage in too much of it jeopardizes 
your tax exemption.
    Ms. Speier. So this training has already taken place?
    Mr. Koskinen. The preliminary training has already taken 
place, but the bulk of it will take place as we get closer 
again. So you will get training if you are a new employee now 
or an existing employee that training has taken place, but as 
we get closer to the election, we will do it again.
    Ms. Speier. Mr. Chairman, I just want to reiterate what I 
believe is the real problem here. The law that passed said that 
if you wanted to be a 501(c)(4), you had to exclusively be 
associated with a social welfare activity. The word was 
exclusively. Then the IRS, back in the 1950s, if I am not 
mistaken, came up with a regulation that said that if you 
wanted to be a 501(c)(4), you have to be primarily focused on 
social welfare. Now, that violated, in my view, the statute. It 
violated what Congress passed. How can you go from being 
exclusively to primarily? So now we have expended millions upon 
millions of dollars trying to figure out whether or not 
something is primarily or exclusive. If we said the 501(c)(4)s 
should be exclusively for social welfare purposes, we wouldn't 
be having these hearings, because none of the political 
activity, whether it was advocacy or political, would be 
relevant because it wasn't exclusively for social welfare; and 
that is what 501(c)(4) should be about. And I think that if we 
went back to redraw this, we would say the regulation did not 
meet the standard of the statute and we wouldn't be having 
these hearings.
    Mr. Issa. Would the gentlelady yield?
    Ms. Speier. I certainly would. My time has expired, though.
    Mr. Issa. I want to ask you just a quick question, because 
I agree with the gentlelady that we should try to clarify it. 
One of the challenges that I face looking at it, and it is not 
our committee's primary jurisdiction, it belongs to Ways and 
Means, but one of the things that I think we have to ask 
ourselves, for example, is if a 501(c)(3) like the American 
Lung Association, if they endorse a California initiative 
related to smoking and so on, which they did, is that at least 
a nuance of political, even though it is not partisan? And, of 
course, the answer is no; they are promoting social welfare.
    One of the challenges with 501(c)(4)s and Tea Party 
specifically is these folks are walking around handing out 
constitutions and wanting to promote the Constitution. Many 
would say that is political, but, if we go to evaluate it, is 
it political to say that this what the First Amendment says and 
means? Is it political to say this is what the Second Amendment 
says and means? Or in the case of the NSA's activities, the 
Fourth Amendment. That is the challenge that hopefully the 
gentlelady and I can work on.
    Of course, the question of whether 501(c)(4)s were targeted 
because of their political views is in fact a different 
question, and that is what is before us today with the 
commissioner.
    I thank the gentlelady for yielding.
    Mr. Jordan. The gentleman from South Carolina is 
recognized.
    Mr. Gowdy. Thank you, Mr. Chairman.
    Commissioner, Lois Lerner sat where you are sitting right 
now and said, I have broken no laws, I have done nothing wrong, 
and I have violated no IRS rules or regulations. Now, as a very 
highly accomplished attorney like yourself, you would have to 
concede that is pretty broad testimony, wouldn't you?
    Mr. Koskinen. That is a statement. Whether it is broad 
testimony and what its relationship is to the----
    Mr. Gowdy. No, it is broad. Your scope of cross 
examination, if we had been in trial, would have been 
unlimited. You mentioned a judge earlier, what a judge would do 
with this subpoena. Let me tell you what a judge would do with 
that testimony. You could ask just about whatever you wanted to 
ask. When a witness says I have done nothing wrong, that is 
tantamount to saying I have done everything right. I can't 
think of any testimony broader than that. So, necessarily, our 
line of inquiry would also want to be broad, wouldn't you 
agree?
    Mr. Koskinen. I think your line of inquiry ought to be what 
it is no matter what people----
    Mr. Gowdy. Well, no. You said a judge would throw our 
subpoena out, and I can't help but note you haven't moved to 
quash our subpoena, but you think a judge would throw our 
subpoena out as being overly broad.
    Mr. Koskinen. If we were in the private sector, which we 
are not, the judge----
    Mr. Gowdy. Well, I want to make it easier for you. How long 
will it take you to produce Lois Lerner's emails that don't 
involve 6103 material from January of 2010? Could we have that 
by Friday?
    Mr. Koskinen. Absolutely not.
    Mr. Gowdy. Why?
    Mr. Koskinen. Because there is no way physically we can get 
it by Friday.
    Mr. Gowdy. January of 2010. That is one month, no 6103 
material, just one month.
    Mr. Koskinen. Just one month?
    Mr. Gowdy. Just one month. When can we get that?
    Mr. Koskinen. Well, we have to go through each of those 
emails to make sure it has no 6103 material.
    Mr. Gowdy. Well, how long is that going to take? Can we 
have it by Friday?
    Mr. Koskinen. I have no idea.
    Mr. Gowdy. Just one month, commissioner. Just January of 
2010, no 6103. And let me tell you why I am interested in it.
    Mr. Koskinen. Well, I will tell you today is Wednesday. I 
would be happy to ask the people who do the work and get back 
to you as to whether we could do it by Friday.
    Mr. Gowdy. All right, let's do January of 2010 and then 
let's get ambitious and do February of 2010. And then let's go 
March 2010. And I think you know why I am doing 2010, 
commissioner. When the President likes 5-4 Supreme Court 
decisions, he calls that subtled law, like the ACA. When he 
doesn't like 5-4 Supreme Court decisions like Citizens United, 
he attacks it, which is what he did in January of 2010. And 
that is why the time line is so important, commissioner. The 
jury is never entitled to know the motive, but they always want 
to know the motive. You don't ever have to prove why somebody 
did something, but the jury always wants to know why did this 
happen. And if you start in January 2010 with the President's 
State of the Union Address and then you move through Lois 
Lerner's emails that have nothing to do with 6103 material, you 
begin to see a motive develop.
    Mr. Koskinen. Great. You are going to get 20,000 pages of 
documents this afternoon. Some of them may well be January 
2010. But I will check with our people, because if you would 
like us to stop that production of Lois Lerner emails and go 
January 2010, I will go and find out exactly how long it will 
take to get it for you.
    Mr. Gowdy. What I want is this: I want the subpoena 
complied with. I want it complied with in a timely fashion. And 
you and I both know that if there is no 6103 material, whether 
or not you think we need something or we ought to have it, or 
that we are on a wild goose chase, frankly, I could care less 
what you think about that. Our subpoena is our subpoena. If you 
don't like it, move to quash it. Otherwise, comply with it. 
Because you noted that our search was overly broad. I want you 
to tell me what search you would use to find an email when IRS 
employee responded Yoohoo when she was told that a Democrat won 
a special election. What search terms would you recommend that 
we use to find that email?
    Mr. Koskinen. We have worked from the start of this 
investigation----
    Mr. Gowdy. What search terms would you use to find an email 
where the response was Yoohoo when a Democrat won a special 
election.
    Mr. Koskinen. We might actually work together to see if 
there are search terms that would involve political campaigns, 
elections, political party.
    Mr. Gowdy. What search term would you use when Lois Lerner 
responded that a GOP Senate would be worse than a GOP 
President?
    Mr. Koskinen. I would actually, if you wanted to, we would 
go through and say look at political parties, look at 
references to elections, GOP and Democrat----
    Mr. Gowdy. Or we can do this: just give us all of the 
emails she sent or received in January of 2010 that don't 
involve 6103 material and we will decide what we think is 
relevant and not, because she said I have done nothing wrong, I 
have broken no IRS rules or regulations, and I have broken no 
laws. That is pretty broad, Mr. Commissioner.
    Mr. Koskinen. Now, if I could just have a moment. This is 
exactly the discussion we have been having for the last year 
and we would be delighted to have, which is out of the 
universe, what is it that you think would be most important? We 
will give you the universe but, as I say, that will take you 
more than this year. If we could figure out----
    Mr. Gowdy. I just told you it is January of 2010, because 
that is when the Supreme Court issued its opinion in Citizens 
United; that is when the President of the United States 
famously, to their faces in the State of the Union, criticized 
that; and that is when Lois Lerner began to say IRS can't fix 
it, we need a plan, we need to be cautious, we need to make 
sure it is not per se political. Let's start with January 2010. 
Can we have that by Friday?
    Mr. Koskinen. And as I would say, I am delighted, and it is 
this kind of discussion, for instance, where----
    Mr. Jordan. Mr. Koskinen----
    Mr. Koskinen. Could I just respond? With a four years worth 
of applications of (c)(4)s, we might be able to say, well, 
which ones would you like so that we don't spend three years at 
it. January 2010 is a perfectly understandable definition, and 
we will actually respond to you as quickly as we can.
    Mr. Gowdy. Commissioner, you need to understand our 
perspective, though.
    Mr. Cummings. Mr. Chairman?
    Mr. Gowdy. Maybe this started off as an investigation into 
the targeting of (c)(4)s, but when you have people who are 
supposed to be apolitical responding the way that she has 
responded, Tea Party dangerous, maybe the FEC will save the 
day, we have to make sure it is not per se political, when you 
have people in positions of authority and responsibility that 
are expressing overtly political commentary on Government 
email, I think we ought to be entitled to all of them, and that 
is why we asked for them.
    Mr. Cummings. Mr. Chairman?
    Mr. Koskinen. I would just simply note that, for the 
record, that you already have all those emails, which is why 
you have all of that information.
    Mr. Gowdy. If we don't know what we don't know, Mr. 
Commissioner----
    Mr. Jordan. Mr. Koskinen----
    Mr. Gowdy. We know the ones we have.
    Mr. Cummings. Mr. Chairman, I asked for----
    Mr. Jordan. I got it, I got it.
    Mr. Koskinen. We will go to January 2010.
    Mr. Jordan. Mr. Koskinen, here is the point. There are 
2,400 employees in the chief counsel's office of the IRS. A 
bunch of those people are lawyers. Mr. Lynch said this, not 
Republicans. Mr. Lynch said this is about First Amendment free 
speech rights, political speech rights. This is so important. 
What Mr. Gowdy is saying, what we all have been saying is take 
some of those lawyers, of that 2,400, a bunch of them are 
lawyers, take some of those lawyers, get every single email 
that Lois Lerner sent. Start with January 2010, go through 
those as quickly as possible and get them to this committee.
    And it is not just Republicans who want that; Mr. Lynch has 
said he wants that, Mr. Cummings, the ranking member, said he 
wants that. Make it a priority. We asked a year ago; we asked 
in May of 2013 get us Lois Lerner's emails. Then we subpoenaed 
them and you are still telling us it is going to take forever, 
we can't do it. We don't want the excuses anymore. Prioritize 
it. Put more lawyers on the job. There are 2,400 in the chief 
counsel's office. Assign someone to do exactly what Mr. Gowdy 
has asked for.
    Mr. Koskinen. This has been a priority; that is how we have 
selected and produced 690,000----
    Mr. Jordan. But we are talking about the First Amendment. 
You are not working fast enough, it is that simple. You are not 
working. This is fundamental. Mr. Lynch said it. Mr. Cummings 
has said it. We have all said it. Get on the job. Put some more 
lawyers on this.
    Mr. Cummings. Mr. Chairman?
    Mr. Koskinen. We are on our job. We have 89,000 employees 
having nothing to do with this doing very important work for 
the Government. We have 10,000 fewer employees than we had four 
years ago. So it is not a question of just pushing----
    Mr. Jordan. We have to move on.
    Mr. Cummings. Mr. Chairman, I just need one minute.
    Mr. Jordan. The gentleman is recognized for one minute.
    Mr. Cummings. Please. I just need a minute.
    Mr. Jordan. You got it.
    Mr. Cummings. Okay. You know, the gentleman, the 
commissioner has said he is willing to produce the documents. 
We have almost every member now asking for documents. One of 
the things that I am saying is that we need to be very clear, 
at the end of this hearing, that we do what you apparently have 
done with Mr. Camp, Chairman Camp and others, to make sure that 
we are all clear on what we want, because different people are 
saying different things. No, no, listen to me. Or we will end 
up right back where we are right now. So we need clarity. The 
chairman wants certain things, Gowdy wants certain things, I 
want certain things.
    So some kind of way we need to come so that we have a 
meeting of minds of exactly what we are trying to get. That is 
all I am saying, Mr. Chairman. I mean, that is reasonable. And 
I think one of the mistakes that we are making, we are beating 
up on him and he is clearly trying to cooperate and trying to 
give us what we want, but, again, he has his own restrictions. 
So I want to make sure that he is saying to you he is willing 
to give us what we want. We now have to be clear on what we 
want. That is all.
    Mr. Jordan. I would just say to the ranking member I think 
we have been.
    Mr. Cummings. Well, apparently we haven't been.
    Mr. Jordan. No, no, no, no. All means all. All means all. 
Because if we let any type of restriction happen, any type of 
parameters be set, then they are determining what we get and 
the American people aren't going to be able to see everything. 
That is why we subpoenaed all.
    Mr. Cummings. So, therefore, and hopefully this will be 
helpful. So do you understand that? And I see that the chairman 
of the full committee, I guess he is in agreement with what was 
just said. Do you understand that, as to what we want?
    Mr. Koskinen. What they want is something that is going to 
take years to produce, not just the emails. What they want is 
documents. And, again, our point is not that we are not going 
to give it; we are just telling you it is not going to happen 
overnight. We have tried to prioritize. First you got 690,000 
to Ways and Means. Tried to prioritize that to Lois Lerner 
emails. We said we would provide them. We said the first 
priority is we will get them that say this. We have to redact 
them. We have given them to Ways and Means. To the extent I 
said it was very helpful if you say the months that we are 
really interested in are these, thous, and those, we can 
prioritize those. It doesn't mean we won't give you the rest of 
the months, but this doesn't happen overnight. It is not a 
question of showing up with another 150 people who become 6103 
experts overnight. We have a team. We aren't a document 
production team organization, but we have created one.
    Mr. Issa. If the gentleman would yield. For the foreseeable 
future there is only one person you have to work with on 
priorities, and that will be the people working for the 
committee, and I will work with them. When Mr. Gowdy said he is 
very interested in January, so am I. I want to attach my 
comments to the ranking member here to the greatest extent 
possible. We do not want to be overly burdensome. We do, Mr. 
Lynch and others, think that certain individuals we want all of 
their emails. I would note for the record that of your six 
investigations there are only two that you have to do 6103 for. 
You don't 6103 for the TIGTA, you don't do 6103 for Senate 
Finance or Ways and Means. And I am assuming the Justice 
Department has a way to fast-track getting what they want.
    So of the two entities, us and our counterpart in the 
Senate, one of the challenges is we have watched Ways and Means 
negotiate to get less than all of Lois Lerner's emails, when in 
fact, six months ago, you could have pumped out all of Lois 
Lerner's emails and dumped them in one fell swoop on Senate 
Finance and Ways and Means. You did not do that. They 
eventually negotiated, to my consternation, a subset of all of 
her emails. I find it less than helpful and I find your talking 
about redaction and time inappropriate, when you could have 
given Ways and Means all Lois Lerner's emails in a matter of 
seconds. It really is that simple. You have already gathered 
them and I assume that TIGTA has access to them.
    So I appreciate that we will have to work with you to 
prioritize, and we will and we always have. In the case of any 
parts of the document production in which there are massive 
numbers of potential documents, we will particularly 
prioritize. For today, for the record, on behalf of people on 
both sides that have spoken, Lois Lerner's emails, all of Lois 
Lerner's emails is the highest current priority of this 
committee, and it will remain so as long as I am chairman. So I 
am not going to get into January, because I believe that if 
your team had been actively working in a matter of days you 
would have been able to give us substantially all of Lois 
Lerner's emails, and within a matter of a couple weeks have 
given us the ones that required 6103 redaction. And I know this 
based on how long it took my people to hand-read the emails we 
got.
    Mr. Koskinen. Right. I would just say that that is not the 
information I have.
    Mr. Jordan. The gentlelady from New Mexico is recognized.
    Ms. Lujan Grisham. Thank you, Mr. Chairman. I am going to 
take something the chairman said, and I hope he doesn't mind, 
and use it out of context. So all means all. I am going to go 
back to none means none. And I want to talk about the 
exclusivity requirements of 501(c)(4)s and the fact that we 
don't do that, and I am going to do what other members have 
done, and I hope you will take me back through these baselines 
again.
    So, commissioner, your agency administers how 501(c)(3)s or 
charities are treated under the tax code, correct?
    Mr. Koskinen. Correct.
    Ms. Lujan Grisham. And under Federal statute, charities 
cannot engage in any political activity, correct?
    Mr. Koskinen. That is correct.
    Ms. Lujan Grisham. How much did charities spend on partisan 
political campaign activities in the last presidential 
election?
    Mr. Koskinen. I assume none.
    Ms. Lujan Grisham. I hope that is true. I am assuming that 
it is zero dollars as well.
    Now, you also administer social welfare organizations, 
501(c)(4)s.
    Mr. Koskinen. Correct.
    Ms. Lujan Grisham. And under Federal statute, laws that 
Congress passes--we get very excited when the administration 
and others don't follow the laws and the rules that Congress 
passes--we said, Congress, that social welfare organizations 
must operate exclusively for the promotion of social welfare, 
correct?
    Mr. Koskinen. Correct.
    Ms. Lujan Grisham. And political campaign activities are 
not a (c)(4) social welfare, not part of their mission, 
correct?
    Mr. Koskinen. Campaign activities, with regard to 
supporting individual candidates, are not social welfare 
activities.
    Ms. Lujan Grisham. That is exactly what I mean. I 
understand that they can do advocacy, and I might even ask that 
again. So we are creating our baseline.
    How much did social welfare organizations spend on 
political candidate campaign activities in 2012?
    Mr. Koskinen. Quite a bit. I have no idea what the final 
number is.
    Ms. Lujan Grisham. Well, let me tell you that it is pretty 
close to a quarter billion dollars. A quarter billion dollars 
on political campaign activities in 2012.
    Do social welfare organizations have to disclose their 
donors behind this quarter billion dollars?
    Mr. Koskinen. No.
    Ms. Lujan Grisham. So social welfare organizations must 
exclusively promote social welfare under Federal law but, 
instead, they are spending hundreds of millions of dollars on 
political campaign activity while keeping their donors secret.
    Mr. Koskinen. Correct.
    Ms. Lujan Grisham. Social welfare organizations are 
blatantly violating Federal law. Doesn't make sense to me, and 
I don't think it makes sense to most of the people who are 
here. What will it take for the IRS to enforce Federal statute 
for social welfare organizations, just as you have successfully 
done for charities, so that social welfare organizations are 
exclusively promoting social welfare agendas and not their 
partisan political agendas? Does it take another act of 
Congress?
    Mr. Koskinen. Well, at a minimum, it would take a new set 
of regulations under 501(c)(4) because, as you know, the 
present regulations adopted in 1959 provide that a social 
welfare organizations only has to be primarily involved in 
social welfare activities.
    Ms. Lujan Grisham. And I have to tell you I don't 
understand that because the law is clear. We have a reg that, 
in my mind, is completely in violation, and I am a little 
worried, although I have a bill that proposes to do just that, 
require the IRS to follow the Federal law and not make 
decisions after the fact, subsequent to that, that are some 
interpretation that, I have a dictionary, exclusive means 
exclusive, none means none. I need to know that another act of 
Congress would actually be taken seriously and be followed 
exactly as the law says. If we pass another law, will the IRS 
follow that law?
    Mr. Koskinen. We will follow that law, although the IRS and 
the Treasury Department always issue regulations for 
interpreting and applying the law in a way that seems to be 
most effective.
    Ms. Lujan Grisham. And I certainly don't want to push you 
into--you didn't, I think, come up with this regulation on your 
own, but in fact I don't understand how any regulation would be 
interpreted to allow up to 49 percent when the law says you 
must do exclusively social welfare. Because my bill clarifies 
that that is what we should do because I want to ensure that 
political money is disclosed in the way that it is supposed to 
be.
    I can't believe, really, that we are here, but I am 
encouraging the IRS, because I don't think that we should be 
doing the regulatory work because I think exclusively means 
exclusively, but given the reality that we are there, that this 
did occur, I encourage you to implement a regulation that 
complies with the Federal statute, ensures that the social 
welfare groups do not engage in political activities, instead 
of continuing to debate how you would go about identifying what 
constitutes political activity and continue on a debate like 
this about what might have gone wrong, if it went wrong. I 
would suggest that you go back to what the law said you must do 
and go back to exclusive, and not allow social welfare 
organizations to engage in any partisan campaign activities.
    Mr. Koskinen. Well, as I noted, the draft regulation asks 
for public comment on three issues. One is what is the 
definition of political activity; two, how much of it should 
you be allowed to do without jeopardizing your tax exemption; 
and, three, to what organizations should it apply. So we have 
comments and we will have a public hearing, and the issue about 
how much is appropriate will be available for comment, and any 
final regulation will have to deal with that.
    Ms. Lujan Grisham. Thank you very much. And I realize I am 
out of time. I disagree that there ought to, still, be any 
effort not to hold them accountable based on what the Federal 
law says.
    With that, Mr. Chairman, I yield back.
    Mr. Jordan. The gentleman from Arizona is recognized.
    Mr. Gosar. Mr. Commissioner, I am a dentist, I am not an 
attorney, so I want to talk about the leadership and how we do 
things efficiently. So I have a patient, and when they come in 
I want to make a diagnosis, so I kind of want to know the 
storyline, true?
    Mr. Koskinen. I am sorry, you want to do what?
    Mr. Gosar. I want to do a diagnosis. I have a problem. I 
want to do a storyline, I want to figure out what the story is, 
right? In your world it is called discovery?
    Mr. Koskinen. Yeah. We actually would want to do--if you 
are interested in finding out what a problem is, you would 
actually go find what the----
    Mr. Gosar. So it makes sense that you would create this 
storyline from where it started and move it back, don't you 
think?
    Mr. Koskinen. Actually, if you----
    Mr. Gosar. One of the lines of my colleague over here, Mr. 
Gowdy, asked----
    Mr. Koskinen. Well, I am not quite sure. If I were doing an 
investigation, I would actually want to know what the facts 
were before I developed the storyline.
    Mr. Gosar. But you base the facts off of the inquiry about 
documents, like all of this stuff that has all these redacted 
comments. But if you want to start at the beginning of the 
storyline, you don't want to start in the middle. I mean, most 
authors will start at the beginning of an instance and move 
forward, right? And it takes leadership to direct troops or 
direct people within the IRS to do so, wouldn't you think?
    Mr. Koskinen. It certainly takes leadership to direct the 
employees.
    Mr. Gosar. And I guess that is my point. If I am doing my 
job, I want to create a storyline to facilitate this oversight 
committee, true? Make it easy.
    Mr. Koskinen. I am not sure what you mean by a storyline.
    Mr. Gosar. Well, you want to make sure that you are 
presenting this to us in a rational manner that allows us to do 
our job.
    Mr. Koskinen. Yes. I have made it clear to our employees, 
a, that a priority is to cooperate with the six investigations, 
get the documents as quickly as we can to them, and, to the 
extent that they are voluminous, try to figure out with them 
what the priority is in terms of providing them.
    Mr. Gosar. I am going to catch you right there because it 
is the comments I keep hearing here. It is the storyline. I can 
tell all my employees, okay, I need an x-ray of this, this, 
this, and this, and they can just go off on tangents; and it is 
not efficient in giving us the documentation in which we want 
to learn, true?
    Mr. Koskinen. Again, if we give you heaps of documents----
    Mr. Gosar. But once again I am going back to a storyline, 
because it seems like----
    Mr. Koskinen. I am not sure where the storyline----
    Mr. Gosar. Well, the storyline starts at the beginning of 
the story, right? You want to go back. Mr. Gowdy asked don't 
you think it is important that we start in January. Doesn't 
that make sense? I mean, you rationally put this together and 
you want to have oversight from this committee, so you 
rationally want to put this storyline together in a rational 
manner. I mean, you can do all you want, throw stuff at us, and 
it is going to take us a lot of time. But it seems like more 
efficiently, from a director of your position, that you would 
direct employees to say let's start at the beginning or what we 
think is the beginning. We are going to start giving you all 
this information starting in January of 2010.
    Mr. Koskinen. No, we didn't do that and we wouldn't do 
that. We actually sat down with the committees and their staffs 
and said what documents do you want, how should we search them, 
what issues are you looking for; and we took the storyline from 
you all.
    Mr. Gosar. And you took it from oversight that when we said 
we want Lois Lerner's, all of her emails, the comment from you 
would have been, then, if I am logistically thinking as 
somebody that is choreographing this story, you want me to 
start in January? Where would you like me to start.
    Mr. Koskinen. For the Lois Lerner emails, as I said, with 
Lois, the idea is if January is a good place to start, that is 
fine. Ultimately, as I said, we have provided already, and you 
will get more this afternoon----
    Mr. Gosar. You are running around and around and around. I 
am from the private sector and this makes no sense.
    Mr. Koskinen. I spent 20 years in the private sector.
    Mr. Gosar. Well, then you should know better. You should 
know better in producing a storyline that makes sense, to say, 
listen, you are here to serve, right? Because I am here to 
serve. How do I make this easier for you to have oversight?
    So I am going to stop there and let's go to something here.
    Mr. Koskinen. All right.
    Mr. Gosar. Since Lois Lerner didn't comply with our 
questions, we need all those emails. And I want to make sure 
you are willing to provide them, like we said.
    Mr. Koskinen. Correct.
    Mr. Gosar. Okay. And would you be interested in 
choreographing them start, finish, kind of in bulk?
    Mr. Koskinen. Yes. We already have a search going on for 
examinations, appeals, and the regulatory process because that 
was determined to be the storyline that would be most helpful. 
We have added now, the next thing we are going to do is January 
of 2010. And, in fact, if we can do that first, because if it 
were easy, I would be happy to comply with that request. But 
the storyline is, thus far, of her emails, which will take us 
weeks still to redact, the suggestion and request wasn't--
because we try to deal with all investigators the same day, 
start with exams, appeal, and regulatory process.
    Mr. Gosar. I got you. I have one more question to ask. Is 
it true the IRS has given the same documents to the White House 
and to Congress that had different redactions? It is my 
understanding that may have occurred.
    Mr. Koskinen. I have no understanding that we redacted 
differently for anybody. There are those who have no 
redactions, and those who get redactions get 6103 redactions, 
and they are redactions for 6103 apply to everybody.
    Mr. Gosar. I would want to make sure that that is followed 
up and----
    Mr. Koskinen. That is fine. If you have other information, 
again, we would be delighted to know it.
    Mr. Gosar. Thank you.
    Mr. Jordan. Mr. Koskinen, if I could, real quickly, while 
Ms. Holmes Norton is talking to the chairman, prior to being 
nominated, did anyone from the White House approach you, ask 
you, talk to you about the proposed (c)(4) rule?
    Mr. Koskinen. No.
    Mr. Jordan. Did anyone in the course of before you were 
officially nominated, anyone from the Administration talk to 
you about the proposed (c)(4) rule?
    Mr. Koskinen. No.
    Mr. Jordan. And I am just curious of your mind-set. Do you 
view your role as commissioner of the Internal Revenue Service, 
do you view that as an independent role, or are you part of 
Treasury and part of the Administration? How do you view your 
role as commissioner of the IRS?
    Mr. Koskinen. The IRS is a division of Bureau of the 
Department of Treasury, but it runs independent as far as tax 
administration. And, as I said, I view it as a critical issue. 
Randolph Thrower died recently who set a standard that the IRS 
should be independent, should not be----
    Mr. Jordan. You view the IRS as an independent agency even 
though it is housed within Treasury.
    Mr. Koskinen. And not a political agency at all.
    Mr. Jordan. And when you prepared your testimony, did you 
and the people at the IRS prepare that, or did someone from the 
Administration or the Treasury help you prepare that testimony?
    Mr. Koskinen. Testimony for today?
    Mr. Jordan. Testimony you submitted.
    Mr. Koskinen. I prepared it.
    Mr. Jordan. Came from you and the IRS.
    Mr. Koskinen. Right.
    Mr. Jordan. If I could real quickly, I want to put up a 
couple slides here. I want to start with slide 1.
    [Slide.]
    Mr. Jordan. This is a letter that Chairman Dave Camp 
received one month ago from--okay, I will wait.
    Ms. Norton was talking with the chairman and I thought I 
would use the time, Mr. Ranking Member, to get some important 
information.
    Mr. Cummings. Can we get equal time?
    Mr. Jordan. I would be happy to. If you let me go, I would 
be happy to give additional time.
    Ms. Norton. I would just like to go because I have 
something at 12:00, if I could.
    Mr. Jordan. The gentlelady is recognized.
    Ms. Norton. Thank you.
    I wanted to come because John Koskinen is a good and should 
I say an old friend because we were in law school together, and 
he turns out to be the man who, if there is a job in the 
Government that can't be done, they call on John Koskinen. So I 
think this is one of those jobs.
    Mr. Koskinen. Eleanor started law school as a very young 
person; I was older.
    Ms. Norton. I do want to say that the committee's obsession 
with Lois Lerner I think could have been avoided. The committee 
asked her attorney would he be willing to engage in a proffer; 
a proffer would have said what she would have testified. And 
then I think all that, a lot of what is in the emails would 
have come out in an attorney's proffer. If the point is to find 
out the truth, it seems to me at least we could have gotten 
through a lot of that here.
    But I do want to clear up something about these so-called 
lists. And I looked at what the IG had found and I am intrigued 
and I think the record needs to show this. It is clear that the 
IG found that they had used inappropriate lists for these so-
called BOLO lists, the Be-On-The-Lookout lists. But he also 
found, is it not true, that high level management was not 
involved. Apparently, IRS people do these kinds of things all 
the time. They did not know, only first-line management knew 
about the references that trouble us, to Tea Party. And so this 
just stayed in place, is that not the case?
    Mr. Koskinen. That was the IG's report, yes.
    Ms. Norton. Then the IG later found that Lois Lerner, who 
has been the obsessive subject of these hearings, didn't even 
learn about it, these inappropriate criteria, until a year 
later; and then she immediately ordered the BOLO lists to be 
eliminated. And again, and isn't this interesting, for lack of 
proper, I think, oversight, perhaps, these workers just went 
back to it because they couldn't figure out a way to deal with 
the issue that has been discussed earlier in these hearings, 
which is how do you know which are primarily and which are not, 
so they went back to the lists. And when the IRS learned that 
their subordinates were again using this criteria, they then 
said you will have to have executive approval.
    Well, what impressed me was that your predecessor has gone 
beyond the notion of getting executive approval and he said 
there is to be no more use of these Be-On-The-Lookout lists, 
these BOLO lists. Is it correct, commissioner, that the IRS no 
longer uses these Be-On-The-Lookout lists for anybody at any 
time?
    Mr. Koskinen. That is correct.
    Ms. Norton. So they have gone further. The IRS has gone 
further than the IG asked to go. As I understand it, the IRS 
has now complied with or is in the process of complying with 
all of the recommendations of the IG, is that correct?
    Mr. Koskinen. That is correct.
    Ms. Norton. I must tell you, John Koskinen, if we want to 
find out anymore, I think what I would do, rather than trouble 
you to go through thousands more emails, is to take the 
agreement, apparently, of Lois Lerner's attorney to offer a 
proffer so that we could find out what she would have 
testified, and then we may get closer to the truth and 
eliminate some of the need for some of the emails.
    Thank you very much for coming forward and thank you for 
agreeing to do this job.
    Chairman Issa. [Presiding.] Mr. Collins.
    Mr. Collins. Thank you, Mr. Chairman.
    A lot has been said about emails, when you produce them, 
and we are going to talk about that in a minute, but I think 
one of the issues that really hits at the heart here of people 
not understanding when it is portrayed and it is put out that 
the IRS has done something that was wrong, that was misguided, 
the terms that I have heard you use today, this is what has 
drawn the parallel of looking at Government and not trusting 
it, and heightened it even more. So if we started off with a 
bad taste, now we are getting worse, and then when it seems 
like we are obfuscating and we are keeping back and we are 
hiding behind requests and defining all and every and what are 
these definitions, people don't get that. And to come to this 
committee, for either one of us, and to say simply, well, we 
are going through them, we are working that out, people don't 
get that. And both sides. This is actually from a hearing we 
just had a few weeks ago. Groups on the left and the right are 
tired. They don't get this and they don't understand why the 
IRS acted this way.
    But I do have some questions. You officially took over 
when?
    Mr. Koskinen. I started on December 23rd.
    Mr. Collins. So you started December 23rd. Are you familiar 
on the date that the first subpoena was issued to the previous 
commissioner?
    Mr. Koskinen. The first what?
    Mr. Collins. The first subpoena for documents for these----
    Mr. Koskinen. The first subpoena actually went to the 
secretary of the Treasury.
    Mr. Collins. And do you know what date that was?
    Mr. Koskinen. That was in August.
    Mr. Collins. Yes, it was. You came in in December. You were 
issued a subpoena on February 14th, correct?
    Mr. Koskinen. Correct.
    Mr. Collins. At what stage did you find what we will just 
say is the compliance to the first subpoena when you took over 
in December?
    Mr. Koskinen. I was not familiar with it and wasn't focused 
on the first subpoena; it went to the Treasury Department.
    Mr. Collins. Okay. When it was being worked on the IRS to 
get to when you get the subpoena on February 14th, are you 
saying, then, that basically we just started over to answer the 
subpoena that you got?
    Mr. Koskinen. No. Actually, it turns out we had already 
provided and have provided significant information on all of 
the categories of the subpoena.
    Mr. Collins. Significant. Okay, but the February subpoena 
asked for what?
    Mr. Koskinen. The February subpoena asked for all emails, 
all documents related to 501(c)(4)s.
    Mr. Collins. Okay. And does significant mean all?
    Mr. Koskinen. No. We actually have not provided all, we 
have provided----
    Mr. Collins. And I think we----
    Mr. Koskinen. And we have said we are going to continue to 
work with the committee to provide the other documents.
    Mr. Collins. And this is where it gets to the point of 
understanding, because this has not been discussed in the last 
three months. It has not been discussed since December. This 
has been going on for coming up on a year now. It has been 
discussed and understood and has been talked about, and 
especially as it got targeted around several individuals, Lois 
Lerner being one of them, that there seems to be--this is what 
I think previously was talked about--a storyline or however you 
want to put it. It is not a storyline, it is the fact that 
there is information wanted, there has been information 
requested, and that--you made a statement earlier and you said 
that the public needs to feel satisfied about what is going on. 
Do you feel they are satisfied right now?
    Mr. Koskinen. I think the public will be very satisfied 
when this committee issues its report.
    Mr. Collins. Okay. But one of the issues that they are 
right now, that they are being satisfied, is they feel like 
they are not getting--wouldn't it be--you said you wanted to 
get this as soon as possible. I agree with what I believe the 
chairman said earlier and others. Make this a priority. Get 
this off the table. Wouldn't it seem to me that if you want to 
provide all, and you said and I take you at your word that you 
want to provide all, that this would be something that you 
would go ahead and get off the table as quickly as possible? 
And I am not sure we buy the fact that it is going to take this 
in redaction, because you have already said most of it might 
not even need redacting.
    Mr. Koskinen. No, I did not say that, others have said 
that.
    Mr. Collins. Okay, so you are saying that every one of them 
is going to need redacting?
    Mr. Koskinen. No, every one has to be reviewed to see 
whether it has to be redacted.
    Mr. Collins. Okay. And----
    Mr. Koskinen. We cannot give you any taxpayer information, 
and every document, every page has to be reviewed.
    Mr. Collins. And nobody is asking you to do that. But I 
think the problem here is this: You have walked into a position 
in which the trust level is zero. And now this committee has 
asked for all documents, and it is not a matter of what we are 
going to redact, it is just get all. We are asking and you said 
we need to do that. But the people don't trust us anymore.
    With my last minute, though, I will yield to the gentleman 
from Ohio. He had a question. We need to get this off the 
table. Gentleman from Ohio.
    Mr. Jordan. I thank the gentleman for yielding, but I don't 
know if I have enough time to get through the material I wanted 
to with the commissioner, so would yield back to the gentleman 
from Georgia.
    Mr. Collins. With that, Mr. Commissioner, I take you at 
your word, but the people that I go home, we don't talk about 
hardly anything else when I go home except IRS, Benghazi, these 
other issues that the people feel like they are not getting an 
answer on, and they are tired of these kinds of hearings in 
which we say, well, we are getting to it, we are coming around 
to it; and especially when they are asked for it, they are 
demanded the answers from the IRS or others when they are asked 
for it on a different time line. It is time to get this done.
    Chairman Issa. Would the gentleman yield?
    Mr. Collins. The gentleman will always yield.
    Chairman Issa. I just want to make it clear of one thing. 
You know, every time you go back and talk about $6 million of 
new computer equipment and the time it takes to redact, I am 
reminded that Ways and Means, only a week ago, was still 
negotiating to try to get subsets of information when, in fact, 
there was no redaction necessary, you could just do a computer 
dump on them. So very clearly you did not use that $6 million 
of new equipment to grab all the emails and just send them 
over, but, in fact, your agency and Treasury was slow-rolling 
Ways and Means and Senate Finance exactly the same way as you 
are slow-rolling us, but without the excuse for redacting.
    Mr. Koskinen. I think that is an improper characterization. 
We, with Ways and Means, have been working through the 
priorities, trying to figure out how we could get them the most 
important, significant information that they think is 
significant as quickly as we can. It is going to take time; it 
has taken time. There is no higher priority in this agency than 
providing the documentation, but oversimplifying how easy it is 
doesn't help us very much; it won't make it go any faster. We 
are committed to continuing to cooperate. I said earlier, to 
the extent we can work with you and identify within the broad 
range of the subpoena what you would like first, we are happy 
to do it. It doesn't mean we won't give you other stuff later. 
With Ways and Means, we have never said that is all you are 
ever going to get; with Ways and Means, we have worked with 
their staff very productively to say here is where we are, what 
else would be helpful to you, what else do you need, and we 
have been providing it.
    Chairman Issa. Very productively for over a year and they 
still don't have it all. That says a lot when there is no 
reduction required.
    Mr. Meadows.
    Mr. Meadows. Thank you, Mr. Chairman.
    Commissioner, I want to go to that time frame. If you have 
someone where the IRS is requiring documents from an 
individual, audit or whatever, is it an excusable excuse to say 
that they don't have the time and it is going to take a year or 
two to get you the information? Is that a permissible excuse to 
not give the IRS documentation?
    Mr. Koskinen. In the course of examinations, we have audits 
of large corporations and it takes us years.
    Mr. Meadows. But me as an individual. Let's say if I came 
to you and just said, golly, commissioner, it is going to take 
a long time to get it, at what point does the IRS say that that 
is not okay?
    Mr. Koskinen. We would say that after we understood what 
your circumstances were. If there was a legitimate reason it 
was going to take time, we would take time. There is no way we 
would ask you to something you couldn't do.
    Mr. Meadows. All right, so you are saying that it is going 
to take years to get us this information, according to your 
testimony a few times ago.
    Mr. Koskinen. With regard to all of the documentation about 
all of the applications for four years, my understanding is it 
is going to take years.
    Mr. Meadows. We are talking about Lois Lerner, all of her 
emails. How long would that take?
    Mr. Koskinen. I cannot tell you. All I can tell you is the 
redacted version of----
    Mr. Meadows. So let me ask you this. Let me change, let me 
ask this. At what point should this committee hold you and your 
agency in contempt for not complying? I mean, what is the time 
line?
    Mr. Koskinen. Well, I think the time line is whenever you 
think you can actually sustain that in a court. I think we have 
a strong case that we have been cooperative, continue to be 
cooperative, and anybody looking at the systems we have and the 
time it takes would find that we have provided you more 
cooperation than in fact might be expected. And I think that, 
in fact, arguing and threatening contempt in that situation 
without understanding the circumstances is probably not going 
to be held up.
    Mr. Meadows. Well, I appreciate your opinion. I can tell 
you the people that I represent, they believe that you are 
stonewalling, and this testimony today is an indication, 
because you have gone over and over again of trying not to 
answer the questions that many of my colleagues have answered, 
you have qualified those.
    But let me go on to another point. February 3rd you made an 
announcement that you were going to reinstate bonuses to the 
tune of $62.5 million and give those back, and go against the 
decision that was made on July 29th. On March 5th, Secretary 
Lew, I guess testifying before the Senate Finance Committee, 
said that the ``senior managers who were anywhere in the chain 
of command who exercised bad judgment in the running of the 
program are no longer there,'' implying that they would not get 
a bonus. Would you agree that they didn't get a bonus? Anybody 
who could have been involved in this targeting did not get a 
bonus?
    Mr. Koskinen. Those people aren't in the pool. This is not 
a bonus pool, it is a performance award pool that goes to 
bargaining unit employees----
    Mr. Meadows. So anybody involved in the targeting--my 
question, let me make it specific. Anybody who was involved in 
the targeting did not get a bonus, is that correct?
    Mr. Koskinen. First of all----
    Mr. Meadows. Yes or no? Yes or no?
    Mr. Koskinen. I have never said there was targeting. So if 
you would let me clarify what the answer is. Nobody----
    Mr. Meadows. So today you are saying that there was not 
targeting?
    Mr. Koskinen. I am saying the IG found that----
    Mr. Meadows. I am saying what did you say. You are the one 
here testifying.
    Mr. Koskinen. I have said that this committee and five 
other investigations will tell us what the facts are. I have 
made no judgment about what happened because I have made no 
investigation.
    Mr. Meadows. All right, so anybody who might have been in 
what I would call targeting, did they get a bonus? Do you know?
    Mr. Koskinen. They would not have been eligible unless they 
were in a bargaining unit. I don't know who is in the 
bargaining unit and who would have gotten those.
    Mr. Meadows. So somebody that was involved in this could 
have gotten a bonus?
    Mr. Koskinen. There are front-line employees in the Exempt 
Organization Division----
    Mr. Meadows. What about senior level management employees? 
Those bonuses come out to the tune of 10, $20,000 per employee. 
Did anybody that potentially could have been involved in these 
decisions, in the bad management practices, could they have 
gotten a bonus?
    Mr. Koskinen. Not to my knowledge; none of them, in fact, 
are there.
    Mr. Meadows. All right. So let me ask you how do you make 
that definitive of a statement if the investigation is not 
done? Because we don't know who is actually involved, unless 
you are making an assumption of guilt or innocence. So how 
would you know that?
    Mr. Koskinen. I would know that because you have given us a 
list of everybody you think is involved. We have actually gone 
through the production of documents. So if there is somebody 
who has been involved that isn't on any of those lists and 
hasn't shown up, it would be a surprise to all of us.
    Mr. Meadows. So your testimony here today is everybody that 
we have identified is innocent. That is your testimony?
    Mr. Koskinen. No, you asked whether they got bonuses. I 
said nobody who is not there got a bonus. Whether they are 
innocent or not, I don't know. I am waiting for the results of 
the investigations.
    Mr. Meadows. Okay, so you can't assure us that they didn't 
get bonuses, because you don't know who they are.
    Chairman Issa. If I can clarify the gentleman's answer, I 
believe, and correct me if I am wrong. If we have identified 
individuals as people of our specific inquiry, those names, I 
think the commissioner is saying he knows they did not get 
bonuses. Is that correct?
    Mr. Koskinen. That is correct.
    Chairman Issa. Okay. And obviously there may be others 
involved, but if we haven't identified them I can see the 
commissioner's point.
    Mr. Meadows. I thank the chairman. I yield back.
    Chairman Issa. Thank you.
    The gentleman from Michigan.
    Mr. Bentivolio. Thank you, Mr. Chairman.
    I have been here all day or all morning listening to you 
and the questions being asked, and somehow I feel like you 
should have come in here with boots on because we are mucking 
out a chicken coop. That is what it feels like. Trying to get 
to the truth, the hardest thing to find in Washington. I have 
heard you say you made no investigation. You have been here 
four months, correct, working for the IRS for four months?
    Mr. Koskinen. Right.
    Mr. Bentivolio. Made no investigation. Yet you said we have 
six investigations going and it is a serious issue. I think 
that should have been the first thing on your list. I have 
heard the opposing side say we are spending a lot of money on 
this investigation, why? And I can't help but think my brothers 
and sisters in uniform fought for this Country on the beaches 
and jungles and deserts defending the freedoms guaranteed by 
the Constitution, and the IRS takes that with, well, it must 
not be very important to them. And that is insulting to me. It 
really is.
    Freedom of speech is very dear to my heart, as is the rest 
of the Constitution. I fought in two wars. I don't care how 
much it costs to guarantee those freedoms. And I would like to 
thank the chairman and the committee for spending so much time 
and energy on this.
    But I am going to cut through everything, because I don't 
really believe you when you say it is going to--20,000 pages 
and it is going to take years to get emails.
    Mr. Koskinen. I didn't say it about emails. I said it would 
take years if you want all of the (c)(4) applications for four 
years and all of the documents related to them.
    Mr. Bentivolio. Okay, we are just talking about emails.
    Mr. Koskinen. If you are talking about emails, I never said 
it would take years.
    Mr. Bentivolio. Okay. You know what? I know students in my 
high school class who could probably go in there for you and 
get them done in a morning.
    Mr. Koskinen. I bet they couldn't make 6103 determinations.
    Mr. Bentivolio. No, that is right, and that is not what we 
are looking for. What I am looking for is the emails from Lois 
Lerner.
    Mr. Koskinen. Emails from Lois Lerner, every page has to be 
looked at to make sure there is no 6103 information on them.
    Mr. Bentivolio. Maybe we should just get those from the 
other committee where you didn't have to do that.
    Mr. Koskinen. That is right.
    Mr. Bentivolio. And they could do that. And you can just 
provide it to them, we can get them from them and redacted.
    But, anyway, I have some really quick questions. In four 
months you haven't done any investigation, but I know that you 
have talked to people in your office. You have asked them some 
tough questions that you are not coming forth with us today.
    Mr. Koskinen. That is not true. Not true.
    Mr. Bentivolio. Well, let me ask you. In your opinion, were 
conservative groups targeted by the IRS to stifle opposing 
views prior to the presidential election?
    Mr. Koskinen. All I know is what the IG found, and he found 
that inappropriate----
    Mr. Bentivolio. What do you know?
    Mr. Koskinen. Pardon?
    Mr. Bentivolio. Yes or no, do you believe, in your opinion, 
do you believe the IRS has done that?
    Mr. Koskinen. I have not taken an opinion on this. My 
position is----
    Mr. Bentivolio. That is an easy way out. Thank you.
    Did Lois Lerner, plan, organize, or target conservative 
groups in cooperation with, at the suggestion of, or at the 
direction of members of the Senate or White House staff?
    Mr. Koskinen. I have no information about that. I am 
waiting----
    Mr. Bentivolio. You have been there four months? You said 
it was a serious issue and there are six investigations. You 
would think you would ask your people directly those questions.
    Mr. Koskinen. No. What I have asked my people directly is 
have we implemented and accepted the IG's recommendation to 
solve whatever management problems were in the system to make 
sure that whatever happened never happens again. That is what I 
think my job is, is to take the organization, manage it going 
forward. My job is not to look backwards in time, my job is to 
try to make sure that we can assure the American public that 
whoever deals with the IRS, no matter what their political 
background, their affiliations, what church they go to, who 
they voted for are going to be treated fairly. That is what I 
think my responsibility is. That is what I think I have an 
obligation to the American taxpayers to do.
    Mr. Bentivolio. Thank you, Mr. Chairman. I would like to 
yield to the gentleman from Ohio.
    Mr. Jordan. I appreciate the gentleman yielding.
    If we could go back to where we were just a few minutes 
ago, Mr. Commissioner. You had indicated that you view your 
role as independent from anyone in the White House, the 
Treasury, even though you are housed in the Treasury. You had 
indicated that your testimony you prepared, you put together, 
and you submitted and read from some of that today when we 
started the hearing. I want to just point out a couple things 
that I find interesting.
    Let's go to slide 1, if we could.
    [Slide.]
    Mr. Jordan. This is a letter from Alastair Fitzpayne, 
Assistant Secretary of the Treasury, to Dave Camp from one 
month ago. And then we have your testimony from today, March 
26th, a month later. Second slide there your testimony, seven 
or eight pages, I think in your testimony. And then I want to 
go to page 7 of your testimony.
    Next slide, if we could.
    [Slide.]
    Mr. Jordan. Now, this is what I find interesting. This is 
your testimony side-by-side from a paragraph that the Treasury 
wrote to Chairman Camp, and this language is even closer than 
earlier when I asked you about the proposed questions and the 
inappropriate questions and the similarity there. This is 
basically word-for-word. There have been numerous misleading 
reports and public statements regarding post-regulations. Exact 
same language from yours. Then you talk about the first draft 
regulation does not restrict any form of political speech. Mr. 
Alastair Fitzpayne's letter, exact same language. Second, exact 
same language. We will give you a copy of this.
    Go to the next slide, if we could.
    [Slide.]
    Mr. Jordan. This is all, again, talking about the (c)(4) 
rule, the draft regulation.
    Chairman Issa. You are going to have to wrap up.
    Mr. Jordan. Okay.
    Draft regulation. What I want to know is if you are 
independent, if you put together your own testimony, why does 
it read word-for-word exactly what the Treasury sent to 
Chairman Camp? It seems to me either it is plagiarism or it 
contradicts what you told me earlier, that you prepared your 
own testimony and that you are an independent agency.
    Chairman Issa. The gentleman's time has expired.
    Mr. Koskinen. May I respond?
    Chairman Issa. Please.
    Mr. Koskinen. I respond on my time. I wrote this testimony. 
I read Mr. Fitzpayne's letter to Chairman Camp. I did not have 
any role in drafting it. I thought the points he raised were 
good points and I thought it was important to put them in my 
testimony, that, in fact, it is important for people to 
understand that these draft regulations are open to public 
comment. I have an open mind about them, but it is important 
for people to understand that people can engage in political 
activity any way they would like. They could become a 527 and 
do nothing in an organization but engage in political activity. 
Whatever regulation we come up with is not going to be focused 
on, and should not be focused on, keeping people from doing 
whatever they want elsewhere; it is focused on what should 
501(c)(3), (4), (5), (6), and (7)s be able to do or not able to 
do, and I thought it was Mr. Fitzpayne's letter to the chairman 
seemed to me accurately portrayed the situation and I thought 
that, therefore----
    Mr. Jordan. So you looked at the letter----
    Chairman Issa. No, the gentleman's time--I apologize, but 
we are going to go to the gentleman from Florida, Mr. DeSantis.
    Mr. DeSantis. Thank you, Mr. Chairman.
    So, commissioner, if you, right now, had a stack on the 
table there of every email to, from or that copied Lois Lerner 
and all the 6103 information was redacted, would you have any 
problem just delivering all those emails to us immediately?
    Mr. Koskinen. No. If I could get them on a stack on the 
table----
    Mr. DeSantis. So it is basically about the process and the 
burden of getting the emails. You don't have a substantive 
objection to the fact that we want this information.
    Mr. Koskinen. No.
    Mr. DeSantis. Okay. So do you know how long it would take 
to just pull those emails that I mentioned? Don't do the 6103, 
just get the emails, most likely in electronic form. Do you 
have any idea how long just that first step would take?
    Mr. Koskinen. I do not.
    Mr. DeSantis. Can you find out and report back to us?
    Mr. Koskinen. I would be delighted.
    Mr. DeSantis. My understanding is that that part would not 
take very long. So you have no idea, as you sit here, how many 
of these emails involving Lois Lerner even exist, correct?
    Mr. Koskinen. I have no idea, that is right.
    Mr. DeSantis. So you can't say that going through the 
documents for 6103 information would necessarily be burdensome 
because we just don't know how many emails we are talking 
about, correct?
    Mr. Koskinen. That is correct. All I know is the burden of 
just trying to get you the redacted versions of her emails 
about exams, appeals, and the regulatory process is going to 
take several weeks.
    Mr. DeSantis. No, I understand, but I mean, for example, we 
don't know, there may be 50 emails of her cheerleading 
Democrats, criticizing Republicans.
    Mr. Koskinen. That is correct.
    Mr. DeSantis. There could be 500 of those. So we don't 
know.
    Mr. Koskinen. Exactly.
    Mr. DeSantis. So I think you understand the committee views 
Lerner's emails as the highest priority. I think if you could 
figure out for us how long it would take just to pull them, and 
then once that is done, let us know how many we are talking 
about. Because what we don't want is to just see this being 
dragged on, dragged on. And that may not be your intent, but a 
lot of my constituents don't believe that the IRS has been 
forthright, and I think that that is bad going forward 
generally.
    There is another issue that I get asked about a lot by my 
constituents, and you were not the commissioner so this is not 
on you, obviously, but Lois Lerner testified last May, she 
basically said she didn't do anything wrong, then she took the 
Fifth Amendment. Now, obviously, we think that she waved at 
some people. Put that aside. Just as an IRS commissioner, if 
you have somebody that high-ranking that comes and they are 
being asked questions about their official conduct in office, 
what do you do if somebody invokes the Fifth Amendment? Now, we 
know that that protects them against criminal prosecution, but 
just running your organization, what then happens to an 
employee going forward if someone is in that situation, where 
they cannot discuss what they did in this official capacity?
    Mr. Koskinen. Well, as you know, she doesn't work for the 
IRS anymore. If an employee takes the Fifth----
    Mr. DeSantis. Well, she did at the time, though, and I know 
you weren't there, but I am just asking you how do you analyze 
that situation. Because we had another IRS official take the 
Fifth involving some fraudulent conduct, not related to this 
investigation; and it just seems like, when that happens, it is 
kind of like, okay, we will reassign somebody and you kind of 
go on your day. But a lot of my constituents look at that and 
they lose confidence in that official's ability to conduct 
their duties.
    Mr. Koskinen. Right. And as you know the assertion of the 
Fifth Amendment is not meant in any way to cast doubt on the 
guilt or innocence of the party or what they would say, so what 
we would do in any normal circumstance like that is consult 
with our personnel people and our legal people to see what the 
circumstances are and what authority we have to take whatever 
action we do. But any time anybody exercises their 
constitutional rights, if that was grounds for dismissal, it 
clearly would undercut the vitality of those rights. So I don't 
think you can automatically say everybody who ever asserts the 
Fifth Amendment on any issue would automatically have adverse 
personnel actions, but we would immediately take a look at it.
    Mr. DeSantis. So you think, though, that it could cause you 
to reevaluate that individual's position and whether they can 
conduct their duties? Because I just think that this is the 
public's business. If we can't get answers to some of these 
questions, put aside what happens to them criminally, I am not 
talking about that. I am just talking about the transparency 
that I think the taxpayers deserve, especially given the power 
of your institution; that if you do have people who are 
misbehaving and targeting citizens, there are few organizations 
where that is more detrimental to freedom than the Internal 
Revenue Service. So I appreciate your diligence on getting us 
the answer on Lois Lerner's emails and I yield back the balance 
of my time.
    Chairman Issa. I thank the gentleman.
    We now go to the dean of the Wyoming House delegation, Mrs. 
Lummis.
    Mrs. Lummis. Thank you, Mr. Chairman.
    Mr. Koskinen, welcome to the committee. Thank you for being 
here.
    Mr. Koskinen. It has been a wonderful day.
    Mrs. Lummis. I am sure.
    I would like to ask you if you ever met Lois Lerner, Holly 
Paz, William Wilkins, or Jonathan Davis.
    Mr. Koskinen. The only person I have met is William 
Wilkins, who is still the general counsel of the agency.
    Mrs. Lummis. Have you ever spoken to him about tax-exempt 
organizations?
    Mr. Koskinen. Tax-exempt organizations. I have not talked 
to him about specific ones. He has been in on meetings where we 
have talked about issues such as responding to the IG's 
recommendations.
    Mrs. Lummis. Have you ever talked to him about Lois Lerner?
    Mr. Koskinen. No.
    Mrs. Lummis. Have you ever talked to him about Holly Paz?
    Mr. Koskinen. No.
    Mrs. Lummis. Have you ever talked to him about Jonathan 
Davis?
    Mr. Koskinen. No. I should say I have never talked to him 
about any of those people in terms of who they are and what 
they did. He has been in meetings where we have discussed 
trying to comply with the requests for discovery and those 
names have been mentioned, but I have never talked to him about 
any of those people individually or their role at the agency.
    Mrs. Lummis. Do I understand correctly that you are willing 
to respond to item 1 in the subpoena prior to responding to 
items 2 through 8 in the subpoena?
    Mr. Koskinen. Item 1 is Lois Lerner's emails?
    Mrs. Lummis. It is.
    Mr. Koskinen. Yes. No, as I have said, we understand. We 
are going to start with January. We are going to continue, 
because we have already started that process and I think it is 
important to get you all of the emails in the areas that I 
talked about, and then we are going to find out about January; 
and we will continue to work with you as to what order and 
priority, and we will let, as noted over there, let you know 
how many emails there are and what the process would be. We are 
delighted to do that.
    Mrs. Lummis. Thank you. Are you aware that there is a 
deficit of trust on the part of the American people with the 
IRS?
    Mr. Koskinen. I do not know that personally. I have heard 
from a number of people talking about their constituents being 
concerned, and I assume and I believe those are accurate 
representations. Whether they represent the entire public or 
not to me is not important. I think every individual member and 
every organization in the Country deserves to feel comfortable 
that they are going to be treated fairly by the IRS, so my view 
is whether it is the entire Country or only segments or parts 
of it is not the question; it is important that everyone feel 
confident and comfortable dealing with the IRS.
    Mrs. Lummis. And, indeed, when I go home, as other members 
have stated, including Mr. Lynch, what I hear is there is a 
deficit of trust; that people feel that they are being targeted 
not only from the tax-exempt organizations, but from other 
entities within the IRS. I have a constituent who has been 
involved in an estate matter for years since her husband died, 
who has the IRS coming and asking what brand of bedroom 
furniture she has. And she has paid $50,000 to accountants to 
try to address the questions of the IRS. That seems to me--by 
the way, she just happens to be a national committeewoman for 
the Republican National Committee and has contributed to 
Republican candidates.
    I would inform you that there are people that believe that 
IRS targeting has gone beyond conservative groups in the 
501(c)(4) and into other areas of the IRS. I would like to 
inform you that the deficit of trust goes beyond tax-exempt 
organizations, and I would like you to know that when 100 
percent of those targeted tax-exempt organizations turned out 
to be conservative organizations and people start threading 
their other problems with the IRS into their Republican 
affiliation or conservative affiliation, it begins to create a 
connect-the-dots situation that has created an enormous deficit 
of trust. And I appreciate your willingness to address what is 
coming up.
    I do want to yield the balance of my time to the gentleman 
from Ohio, Mr. Jordan.
    Chairman Issa. And, with that, we are going to give the 
gentleman from Ohio two full minutes to conclude.
    Mr. Jordan. I appreciate that, chairman.
    When do you anticipate completing looking at the comments 
and making a decision on the proposed rule relative to (c)(4) 
organizations?
    Mr. Koskinen. Again, that is difficult to project. We 
obviously have a lot of comments----
    Mr. Jordan. You are obligated to look at all those 
comments.
    Mr. Koskinen. We need to review those. We will hold a 
public hearing where the public and members of Congress can 
testify. If we are going to significantly change, which is 
possible, certainly, the regulation, we would probably have to 
republish it. So as I have said in the past, I think it is 
unlikely we are going to get this done----
    Mr. Jordan. Do you have an opinion on the proposed rule 
now, prior to looking at the comments? You said you haven't 
looked at them. Do you have an opinion on the rule now? Do you 
think it is a good rule? Do you think you are going to stick 
with it or do you think you are going to change, you being the 
head of the IRS?
    Mr. Koskinen. Head of the IRS, my position has been that I 
am going to keep an open mind about the entire thing so that I 
can look at all the comments fresh. I wasn't here when the 
regulation was drafted, so I don't have a dog in that fight. My 
commitment is that any regulation that comes out ought to be 
fair to everybody, it ought to be clear, and it ought to be 
easy to administer.
    Mr. Jordan. I have 50 seconds. Let me go back to where I 
was earlier on your testimony. You indicated that you took this 
directly from Mr. Fitzpayne's letter, lifted it from his and 
inserted it into yours. Do you view that as plagiarism, Mr. 
Koskinen?
    Mr. Koskinen. If I were publishing it for credit of one 
kind or another I would. In terms of----
    Mr. Jordan. Do you think you should have cited where it 
came from?
    Mr. Koskinen. Pardon?
    Mr. Jordan. Do you think you should have cited that it came 
from the Treasury Department? I mean, your answer to me earlier 
was we are independent, I view my role as independent; no one 
talked to me about the (c)(4) rule during the nomination 
process, no one at the White House, no one asked me about it 
prior to being nominated, going through the confirmation 
process; and yet you take directly from the Treasury Department 
their exact language regarding the (c)(4) rule, insert it into 
your testimony and then come here and say you are independent. 
That is our concern.
    Mr. Koskinen. If I find a good idea somewhere and I think 
it is appropriate to put into the public domain, I am happy to 
do it.
    Mr. Jordan. I understand that, but you specifically told me 
you didn't do that; that you work independent and you put 
together your own testimony and you didn't work with the 
Treasury, no one influenced you about the (c)(4) and no one 
asked you about it when you went through the nomination 
process.
    Mr. Koskinen. I am independent of this committee. If you 
have a very good idea, I am likely to adopt----
    Mr. Jordan. You know what? We have a good idea. We have a 
real good idea. Give us every one of Lois Lerner's emails as 
soon as possible.
    Mr. Koskinen. Right. And we are going to work on that 
together.
    Chairman Issa. I thank you.
    We now go to the gentleman from Maryland, Mr. Cummings, for 
his close.
    Mr. Cummings. Thank you very much. Mr. Chairman, this 
hearing has been very helpful in that I think we were able to, 
to some degree, focus on an IG report. The IG had nine 
recommendations and they have all been met.
    And I want to take a moment to say to the IRS employees who 
are watching us, and to you, Mr. Koskinen, I just want to thank 
you for your service. You all have one of the toughest jobs in 
America, collecting taxes. At the same time, you have laws that 
you have to make sure are adhered to. And when people get those 
letters saying that they are about to have an audit, or they 
get anything from the IRS, except a check, their blood pressure 
probably goes up a little bit because they are concerned.
    And the reason why I say all that is I want to go back to 
something that Mr. Lynch said. I think that when you have any 
kind of breach of trust, what happens is that it makes 
everything suspect; and I know that you have come in to try to 
restore that trust, and it is not easy. On the one hand, you 
have come in and you have taken up where Mr. Werfel left off; 
and I give him a lot of credit, as I know you do.
    Mr. Koskinen. Right.
    Mr. Cummings. And all those employees who are working hour 
after hour, giving their blood, sweat, and tears to try to make 
this work. But then, no matter what happens, there is still a 
search for what part Ms. Lois Lerner played in this, and she 
really brought on some of her own problems, to be frank with 
you. So you have the committee trying to get to that and, in 
reality, it is relevant to a degree, and that is so that we 
figure out what happens so that we make sure it doesn't happen 
again. So that is significant.
    But I don't want that to take away from what you all have 
accomplished, because I know that it has not been easy. And 
there has been much talk about the regulations, the proposed 
regulation, and I was just looking here at the recommendations 
of the IG. He recommended to IRS chief counsel and Department 
of Treasury that guidance on how to measure the primary 
activity of IRC and 501(c)(4) social welfare organizations be 
included for consideration in the Department of Treasury 
priority guidance plan. That is what the IG said.
    And somebody here, I think it may have been Mr. Jordan, 
went on and on and on and on and on and on and on about how 
nobody is happy. Well, in my 32 years being in public life and 
looking at laws and regulations, I can tell you most people 
aren't happy about something in a law. That is the way it is. 
So the thing that I want to make sure does not happen is that 
there is not a chilling effect on the IRS and the job that they 
are supposed to do. I don't want them to be in a position where 
they become so paranoid that they don't do what we, the 
Congress, had mandated that they do.
    So I am hoping that, again, the employees will do their 
jobs, will continue to do the very best that they can, use 
their best judgment. Hopefully, and I pray that they will, 
leave their political hats at the door so that Americans, all 
of them, will be served the way that the Congress intends for 
them to be served, and that is everybody treated fairly and 
equally.
    With that, I want to thank you.
    Mr. Koskinen. Can I just comment for a minute?
    Mr. Cummings. I hope the chairman will give you a second.
    Mr. Koskinen. I would have responded to the congresswoman 
from Tennessee that even with our restrained and constrained 
resources, we will do a 1,300,000 audits this year. Some of 
them are going to be Democrat, some of them are going to be 
Republican; some are going to be long to one organization or 
another; some will go to church, some won't go to church; some 
will have been in a meeting two months ago.
    It is important for us and critical for the taxpayers to 
understand that no matter who you are, what your background is, 
at this point, dealing with the IRS, when you get an inquiry 
from us, it is because of something in the material you filed, 
and you are going to be treated fairly. And if anybody else had 
the same information in their material they filed, they would 
get an inquiry from us. It may mean we need more information, 
we need an explanation, maybe there has been a mistake.
    But, across the board I think the point is well taken, if 
there is a decline in trust, people are all going to try to 
figure out, when they get a letter from the IRS, why are they 
getting it; and what I want them to be comfortable with, and it 
will take time to reassure them, they get that letter because 
of something they filed in their returns. It has nothing to do 
with who they are, nothing to do with their political beliefs, 
nothing to do with who they voted for in the last election. And 
I understand that for some people that is hard to believe right 
now, but that is our commitment and that is our goal in the 
years going forward.
    Mr. Cummings. Thank you.
    With that, Mr. Chairman, I yield back.
    Chairman Issa. Thank you.
    Often, for a chairman it is hard not to bring your past 
experiences into Congress. Sometimes it is helpful. When I was 
starting in business, my very first year, I was audited on my 
income as an Army 1st lieutenant. Went in with the paperwork 
and my fledgling new accountant from my new firm, and it turns 
out that the auditor was a former military officer and he was 
horrified that I had received so much per diem from temporary 
duty; and he kept saying, but I never got anything like this, 
it is not possible. He wasn't a military expert, he was an IRS 
auditor, and he was just angry as hell that I was in TDY 
apparently full time except for one or two days a quarter for 
years. I was with an experimentation command; we were always 
there.
    Ultimately, I paid no new taxes and there wasn't a problem, 
but it was remarkable to me to realize that he came with a 
prejudice. It wasn't a Republican prejudice, it wasn't a 
Democratic prejudice; it was a prejudice about the money I got 
tax-free as a per diem recipient. That is human nature. We are 
dealing with human beings.
    This investigation may be about politics or it may be about 
human beings, and your charge, of course, is to try to wring 
out the wrong behavior in both cases. You are charged not just 
with making sure they don't pick on me because I am a 
conservative or Mr. Cummings because he is comparatively 
liberal, but also the whole question of they audit a lot of 
people who make a lot more money than they do. That is not a 
get-even time. All of those and more are part of your charge.
    But the investigation before us primarily is about some 
past conduct, and I want to put into the record--these are from 
a previous hearing, but I will put them in at this point for 
continuity--July 10th, 2012, two emails related to Lois 
Lerner's emails in which it has in it Democrats say anonymous 
donors unfairly influence Senate races. It says, perhaps the 
FEC will save the day. Now, this includes Holly Paz, Sharon 
Light, and Lois Lerner in the train, and it also mentions 
Crossroads GPS and a number of other things; and it 
particularly says the Obama campaign, and then it is semi-
redacted, filed e similar complaint against Crossroads GPS, 
watchdog groups, and so on.
    One of the things that we are finding, and it was here 
today in testimony that you made, it was definitely on a number 
of my Democratic members, Ms. Speier and others, Ms. Grisham, 
they have a real problem with the 501(c)(4) not disclosing 
their donors. They want 501(c)(4)s to essentially not be able 
to do what they do; they want them to be 527, another category, 
correct?
    Mr. Koskinen. I don't know what they want. The 527 is 
another tax category for political organizations.
    Chairman Issa. So 527s can do all the activities they want 
to do, political; they just have to disclose their donors. That 
falls under the Federal Election Commission.
    The charge this committee has in Government oversight and 
reform includes making sure that we properly allocate resources 
and authorities where they are supposed to be. In 1959, more 
than 50 years ago, 50 years before Barack Obama was elected 
President, the American people made certain decisions on a 
501(c)(4), and the ruling that came out of that stood for all 
those years, and there was clearly political activity by 
501(c)(4)s and they did not report their donors.
    When Congress created the Federal Election Commission, and 
through Shays-Meehan, McCain-Feingold, and other reforms over 
the years, changes were made. I find no record that they made a 
decision that the American people, through their elected 
representatives, Republicans and Democrats, made any decision 
to make 501(c)(4)s report their donors or to limit their 
ability beyond the majority decision that had been made and the 
rule for decades.
    It would appear as though, through these emails and other 
activities of Lois Lerner and others, individuals at a very 
high level in Washington working for your agency made a 
decision that they were going to do what the FEC was charged to 
do but use their authority. I believe that it has been well 
shown there. I believe that is one of the challenges we face, 
beyond the fundamental investigation of the targeting.
    If the IRS is allowed to become a wing of the Federal 
Election Commission, if you are allowed to create a rule, 
modify rules because you, the President, or executives within 
the IRS or Treasury believe that it shouldn't be some way, that 
they should have to report, and that is the reason for changing 
a 501(c)(4), which cannot exclusively do politics, but can do 
some amount of politics, even by your own self-declaration 
right now, 40 percent, without reporting their donors, that in 
fact the IRS is legislating and regulating using authority they 
don't have to legislate and regulatory authority they don't 
have that the FEC has.
    Congress, in its wisdom, and past presidents have, in fact, 
provided the rules under which the Federal Election Commission 
operates and where the disclosure is. Many members of this 
committee have expressed their willingness and their concern 
and their belief that the rule should be changed. Whether I 
share that or not, my concern, as the head of this oversight 
committee, and I would hope all the committees doing oversight, 
is that you not take it on yourself, or anyone that works for 
you or for the Executive Branch, to legislate a change. That is 
the exclusive purview of Congress. And reevaluating an existing 
law 50 years ago, quite frankly, belongs to the courts, not to 
an agency to conveniently reinterpret something based on who is 
using it and how, and whether it is politically acceptable.
    So our committee will continue to investigate on behalf of 
the American people because we do find the fundamental 
evidence, beyond the targeting of conservative groups, that the 
decision of Citizens United and the growth of the use of 
501(c)(4)s to do some politics, but not exclusive, in fact 
appears to be the reason for action by the IRS. It is within 
our jurisdiction, it is within our purview to continue that.
    So, in closing, I must tell you we do want all of Lois 
Lerner's emails. We do want all of Holly Paz's emails. We don't 
believe that you have been forthcoming in a timely fashion. We 
do believe that you have given us what you believe is 
responsive, hoping we would never get the rest, when in fact, 
when I issued the subpoena and then reissued a subpoena to you, 
I did so to make it very clear that our investigation as to 
emails like this one tell us we need to look at all of her 
correspondence for why she was doing what she was doing and who 
she was doing it with.
    Mr. Cummings. Can he respond to that?
    Chairman Issa. No, it is a closing statement. And I didn't 
ask a question, I made a statement.
    Mr. Koskinen. Right. I may not agree with all the 
conclusions in the statement, but it is the chairman's right to 
make whatever statement he would like.
    Chairman Issa. It is only a statement. I certainly let him 
answer yours. But this was a statement and I wanted you to 
understand where the investigation was going, which is really 
what the close was about.
    Mr. Cummings, during the course of this investigation, you 
raised procedural questions related to Ms. Lerner's conduct 
when she appeared before the committee on May 22nd, 2013, and 
again on March 5th, 2014. You had a consultant, Mr. Mort 
Rosenberg, look into this. He prepared a memo. The Office of 
General Counsel in turn prepared a memo to advise the members 
of the committee on this topic. I now ask unanimous consent 
that that memo be placed in the record. Without objection, so 
ordered.
    Chairman Issa. Mr. Commissioner, I appreciate you were 
treated well in some cases and in some cases our members went 
off topic. You handled yourself incredibly well. We do have 
disagreements on discovery speed; I am sure we always will. I 
do appreciate your being here today and your answering all 
questions. I did not weigh in when people went off topic and 
you handled yourself very well. I would have weighed in if I 
thought that you were sinking. You were not. So I want to thank 
you.
    Is there anything more, Mr. Cummings?
    Mr. Cummings. No, just that we will provide you with our 
memo in response to yours, which has 23 experts who agree with 
us.
    Chairman Issa. We can continue to play the tit-for-tat.
    Mr. Cummings. No tit-for-tat, I was just letting you know, 
that's all.
    Chairman Issa. Okay, very good. Thank you.
    Mr. Cummings. Very well.
    Chairman Issa. And, Mr. Commissioner, thank you.
    We stand adjourned.
    Mr. Koskinen. Thank you.
    [Whereupon, at 12:45 p.m., the committee was adjourned.]


                                APPENDIX

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