The document isn't clear on whether the IRS misled Congress. 5 takeaways from IRS report 
 
 The most hotly anticipated IRS probe since Watergate didn’t exactly live up to the hype. 
 
 The Treasury Inspector General for Tax Administration report leaked on Tuesday evening doesn’t nail anyone for lying to Congress. It didn’t out rogue liberal IRS agents with an ax to grind against nonprofit tea party groups. 
 
 Story Continued Below 
 
 But the watchdog report did break new ground, clearly declaring that the IRS crossed the line in asking about donors to conservative groups. It reveals the IRS to be a stubborn agency that isn’t ready to fix all the problems in the report. And it warns that a crackdown on these 501(c)(4) groups isn’t coming any time soon. 
 
 ( PHOTOS: 10 slams on the IRS) 
 
 Here’s the top five things takeaways from the Inspector General report: 
 
 IRS agents weren't partisan 
 
 Republicans looking for a smoking gun on partisan motive will have to keep looking — the report stops short of calling the IRS intentionally partisan, even if the questions might have been inappropriate. 
 
 Most of the report focuses on reprimanding the IRS for choosing ineffective criteria that could be construed as partisan rather than focusing on a partisan motive. Only about 15 percent of the potential cases had the terms “Tea Party,” “patriots” and “9/12” in their organization name. The remaining cases were flagged for other reasons. 
 
 The report found that the narrow focus of the criteria “gives the appearance that the IRS is not impartial in conducting its mission.” 
 
 “Using the names or policy positions of organizations is not an appropriate basis for identifying applications for review by the team of specialists,” the inspector general said. 
 
 ( Also on POLITICO: Watchdog: IRS used 'inappropriate criteria') 
 
 The report never directly accuses the IRS of bias, just the appearance of impropriety. 
 
 Despite the inappropriate search criteria, the majority of applications flagged by the Cincinnati office had indications of significant violations of tax policy. The report found that about 69 percent of the fully documented cases on the list were properly identified. 
 
 Unclear on whether the IRS misled Congress 
 
 The report remains silent on what is emerging as the biggest Republican grievance — how Acting IRS Commissioner Steven Miller and former Commissioner Doug Shulman failed to disclose to Congress what they learned about the targeting program after May 2012. 
 
 Miller wrote letters to the House Ways and Means Committee and Senate Republicans months after he was briefed but never disclosed that the agency was giving an extra critical eye to conservative groups. Government oversight Chairman Darrell Issa (R-Calif.) also accused division head Lois Lerner of misleading Congress after her June 2011 discovery. 
 
 “It appears that you provided false or misleading information on four separate occasions last year in response to the committee’s oversight of the IRS’s treatment of conservative groups applying for tax exempt status,” Issa and committee member Rep. Jim Jordan (R-Ohio) wrote. 
 
 But you won’t read about that in the IG report. 
 
 The controversial answers from Miller on why top agency employees did not tell Congress about the extra scrutiny will likely come forth during the Ways and Means hearing this Friday. 
 
 Asking about donors crossed the line 
 
 If tea party groups thought the questions were intrusive, even the Inspector General agrees that asking about donors and books read was a bridge too far. 
 
 The Inspector General said donor lists and details were an unnecessary, burdensome request in the vetting process. That may be the biggest victory for frustrated conservatives. 
 
 The report also makes clear that the IRS knew that it overstepped its bounds when it asked for donor records. 
 
 “Officials informed us that they decided to destroy all donor lists that were sent in for potential political cases that the IRS determined it should not have requested,” the report said. ||||| Daniel "Danny" Werfel, acting commissioner of the Internal Revenue Service (IRS), speaks during a House Appropriations subcommittee hearing in Washington, D.C., on June 3, 2013. 
 
 Daniel "Danny" Werfel, acting commissioner of the Internal Revenue Service (IRS), speaks during a House Appropriations subcommittee hearing in Washington, D.C., on June 3, 2013. Close 
 
 The Internal Revenue Service used terms such as “progressive” and evidence of advocacy on Israel to flag groups’ tax-exempt applications for extra attention, complicating what had been seen as targeted scrutiny for small-government groups. 
 
 The IRS’s disclosure yesterday of 15 redacted versions of its Be On the Lookout document, or BOLO, bolstered its contention that delays experienced by Tea Party groups applying for nonprofit status were a symptom of mismanagement and not politically motivated action. 
 
 “The BOLO list in my mind loses this sinister nature,” said Jeff Trinca, who was chief of staff to the IRS restructuring commission in the 1990s and is now a lobbyist at Van Scoyoc Associates in Washington. “And it becomes another way of creating criteria lists to try to deal with the huge volumes that come through the agency.” 
 
 The disclosure raised a new set of questions about the IRS, which acknowledged last month that it had given extra attention to Tea Party organizations and other advocates for small government. The documents don’t explain how employees used the BOLO or which groups, if any, received extra scrutiny because of it. 
 
 Representative Sander Levin of Michigan, the top Democrat on the tax-writing House Ways and Means Committee, said the IRS inspector general, J. Russell George, should explain why his May 14 report didn’t include this information. 
 
 Photographer: Andrew Harrer/Bloomberg The Internal Revenue Service revealed May 10 that it had given extra attention to Tea Party groups and other small-government advocates. Close The Internal Revenue Service revealed May 10 that it had given extra attention to Tea... Read More Close Open Photographer: Andrew Harrer/Bloomberg The Internal Revenue Service revealed May 10 that it had given extra attention to Tea Party groups and other small-government advocates. 
 
 ‘Flawed’ Probes 
 
 “The audit served as the basis and impetus for a wide range of congressional investigations and this new information shows that the foundation of those investigations is flawed in a fundamental way,” Levin said in a statement. 
 
 Since the IRS apologized for scrutiny of Republican-leaning groups on May 10, six congressional committees have opened inquiries and the Justice Department has begun a criminal probe. President Barack Obama replaced the acting IRS commissioner and Danny Werfel, the agency’s interim leader, has replaced three others with direct responsibility for tax-exempt groups. 
 
 The documents don’t show that Tea Party groups and progressives were treated equally. In fact, they suggest that the entries on the BOLO derived from separate efforts to police applications for tax-exempt status for political activity. 
 
 Law Enforcement 
 
 The IRS is charged with enforcing tax law, which forbids political activity for 501(c)(3) charities that can receive tax-deductible contributions and limits campaign involvement for 501(c)4 social welfare groups that don’t have to disclose their donors. 
 
 The term “progressive” appeared on a November 2010 document released by House Ways and Means Committee Democrats. It appears to refer to applications for 501(c)(3) status, not the 501(c)(4) status sought by many Tea Party groups. 
 
 Employees were told to watch for applications that were “partisan and appear as anti-Republican.” On the document released by Democrats, the reference to progressives is in a different section than the Tea Party groups, and it doesn’t direct employees to send the cases to a special unit, unlike the Tea Party cases. 
 
 Even on the first BOLO document released, from August 2010, progressives are listed under the label of TAG Historical, short for Touch-and-Go Historical, or issues that had been raised in the past. Tea Party is listed under Emerging Issues. 
 
 18-Page Surveys 
 
 The disclosure of the scrutiny of groups working on Israel-related issues confirms what organizations had suspected. 
 
 Ameinu, which on its website calls itself a “community of progressive Jews,” received its 501(c)(3) tax-exempt status on May 28 -- five years after applying. 
 
 IRS agents peppered the group with 18-page surveys and lingered for months without follow-up, Hiam Simon, national director of Ameinu, said in a telephone interview. He said he was looking at a 4-inch thick folder of Ameinu’s communications with the IRS. 
 
 “I think they were painting with a broad brush, with worries about Middle East ties to terrorism,” he said of the IRS. “I don’t think it was caused by malice. Ignorance is too strong a word, too. They simply weren’t nuanced enough or careful enough.” 
 
 Committee hearings, an inspector general’s report and congressional investigators’ interviews with IRS employees have shown the scrutiny of Tea Party groups started with a single case in February 2010 that an employee flagged to his manager. 
 
 Werfel said he was suspending the use of BOLOs, which were employed as recently as last month. The final BOLO released, from April, doesn’t include Tea Party or progressive groups specifically, just general language about political involvement. 
 
 Redacted Information 
 
 The IRS took several weeks to release yesterday’s documents, because it had to scrub the be-on-the-lookout lists of taxpayer-specific information before making them public. The BOLO mostly consists of redacted information. 
 
 The prospect that Democratic-friendly groups experienced extra scrutiny wasn’t entirely new. 
 
 Eight groups with “progress” or “progressive” in their names had appeared on a publicly available list of groups whose applications had been delayed and later approved by the IRS. That list included many small-government groups. 
 
 Progress Texas, an Austin-based group that typically backs Democratic positions, received an IRS letter with essentially the same questions the agency had asked of some Republican-leaning groups. As with Tea Party groups, the IRS wanted promotional materials, backgrounds of officers, meeting minutes and specifics about activities the organization said it would conduct. 
 
 Time Consuming 
 
 Matt Glazer, former executive director, told Bloomberg News in May that the questionnaire was time consuming, though not intrusive. His group was approved. 
 
 Still, Steven Miller, the former acting IRS commissioner, told the Ways and Means Committee May 17 that progressive groups weren’t targeted. 
 
 Congressional Republicans said the IRS’s actions against small-government and Republican-leaning groups weren’t limited to extra scrutiny of tax-exempt applications. 
 
 House committees are also probing gift-tax audits of donors to a group that backed the war in Iraq, disclosures of the confidential information of several groups and IRS requests that anti-abortion groups agree not to protest at Planned Parenthood as a condition of receiving their tax-exempt status. 
 
 Flagging Groups 
 
 “It is one thing to flag a group,” Sarah Swinehart, a spokeswoman for Ways and Means Chairman Dave Camp, said in an e-mailed statement. “It is quite another to repeatedly target and abuse conservative groups.” 
 
 Werfel will testify at a Ways and Means hearing June 27. 
 
 J. Russell George, the inspector general whose report revealed the Tea Party scrutiny, was asked at a May 22 hearing whether Democratic-leaning groups were targeted. 
 
 At first, he said he couldn’t give a definitive answer when questioned by Representative Darrell Issa, a California Republican and chairman of the House Oversight and Government Reform Committee. 
 
 Then, George said that under “the purposes of the audit that we conducted, which was to determine whether they were looked for in the context of political campaign intervention, there were no others.” 
 
 The inspector general’s office said in a statement that the initial review had been limited to language designed to flag political involvement. 
 
 New Review 
 
 “Although these criteria were not used to select cases for review of potential political campaign intervention, we are reviewing whether these criteria led to expanded scrutiny for other reasons,” according to the statement. 
 
 Dianne Belsom, president of the Laurens County Tea Party in South Carolina, told lawmakers earlier this month her group had been waiting almost three years to hear from the IRS on an application for tax-exempt status after answering repeated and extensive questionnaires. 
 
 “The IRS needs to be fully investigated and held accountable for its incompetence, harassment and targeting of conservative groups,” Belsom said at a June 4 Ways and Means Committee hearing. 
 
 The BOLO also has terms related to Israel, looking for applications that “deal with disputed territories in the Middle East” and “may be inflammatory.” 
 
 Z Street, which describes itself as a Zionist education organization, sued the IRS in federal court over its treatment, which it called discriminatory. 
 
 “It’s great that they’re finally acknowledging what we’ve known all along,” co-founder Lori Lowenthal Marcus said in a telephone interview. 
 
 IRS Backlog 
 
 Marcus said the IRS told Z Street it “froze” their application for 501(c)(3) tax-exempt status when it filed suit. The case is scheduled for hearings next month in U.S. District Court for the District of Columbia. 
 
 The documents also show that the tax-exempt office was handling issues that had nothing to do with political campaigns or partisanship, such as cases involving medical marijuana, “potentially abusive” pain management clinics and life insurance policies owned by charities. 
 
 Also yesterday, Werfel released a report outlining his plans for restoring trust in the agency and reducing the backlog of applications for tax-exempt status. 
 
 ‘Fairness,’ Neutrality 
 
 Groups stuck in the backlog will have a chance for approval of their applications within two weeks if they promise to limit political spending. The IRS will send letters to about 80 groups. 
 
 “The administration is committed to making sure the IRS continues to reform itself with the goals of providing the highest quality service and reflecting the principles of fairness and neutrality,” Jay Carney, the White House press secretary, said in a statement. 
 
 Obama was briefed yesterday by Werfel and Treasury Secretary Jacob J. Lew. 
 
 Werfel said his review of the agency’s actions hasn’t found evidence of intentional wrongdoing or involvement from outside the IRS. That’s consistent with the findings so far of congressional investigators. 
 
 “They just let it fester and then they let some folks who didn’t really have the guidance they need go crazy with these questions,” said Trinca, a former Democratic congressional staff member. “The whole thing was just an absolute debacle.” 
 
 To contact the reporters on this story: Richard Rubin in Washington at rrubin12@bloomberg.net; Julie Bykowicz in Washington at jbykowicz@bloomberg.net 
 
 To contact the editor responsible for this story: Jodi Schneider at jschneider50@bloomberg.net ||||| In a press conference Monday, President Obama addressed the Internal Revenue Service’s targeting of groups critical of government, and said, “I’ve got no patience with it. I will not tolerate it.” (The Washington Post) 
 
 In a press conference Monday, President Obama addressed the Internal Revenue Service’s targeting of groups critical of government, and said, “I’ve got no patience with it. I will not tolerate it.” (The Washington Post) 
 
 Internal Revenue Service officials in Washington and at least two other offices were involved with investigating conservative groups seeking tax-exempt status, making clear that the effort reached well beyond the branch in Cincinnati that was initially blamed, according to documents obtained by The Washington Post. 
 
 IRS officials at the agency’s Washington headquarters sent queries to conservative groups asking about their donors and other aspects of their operations, while officials in the El Monte and Laguna Niguel offices in California sent similar questionnaires to tea-party-affiliated groups, the documents show. 
 
 IRS employees in Cincinnati told conservatives seeking the status of “social welfare” groups that a task force in Washington was overseeing their applications, according to interviews with the activists. 
 
 Lois G. Lerner, who oversees tax-exempt groups for the IRS, told reporters Friday that the “absolutely inappropriate” actions were undertaken by “front-line people” working in Cincinnati to target groups with “tea party,” “patriot” or “9/12” in their names. 
 
 In one instance, however, Ron Bell, an IRS employee, informed a lawyer representing a conservative group focused on voter fraud that the application was under review in Washington. On several other occasions, IRS officials in Washington and California sent conservative groups detailed questionnaires about their voter outreach and other activities, according to the documents. 
 
 View Graphic A report due this week says the IRS targeted groups with names containing “tea party” and “patriot.” 
 
 “For the IRS to say it was some low-level group in Cincinnati is simply false,” said Cleta Mitchell, a partner in the law firm Foley & Lardner who sought to communicate with IRS headquarters about the delay in granting tax-exempt status to True the Vote. 
 
 Moreover, details of the IRS’s efforts to target conservative groups reached the highest levels of the agency in May 2012, far earlier than has been disclosed, according to Republican congressional aides briefed by the IRS and the Treasury Inspector General for Tax Administration ­(TIGTA) on the details of their reviews. 
 
 Then-Commissioner Douglas Shulman, a George W. Bush appointee who stepped down in November, received a briefing from the TIGTA about what was happening in the Cincinnati office in May 2012, the aides said. His deputy and the agency’s current acting commissioner, Steven T. Miller, also learned about the matter that month, the aides said. 
 
 The officials did not share details with Republican lawmakers who had been demanding to know whether the IRS was targeting conservative groups, Republicans said. 
 
 “I wrote to the IRS three times last year after hearing concerns that conservative groups were being targeted,” Sen. Orrin G. Hatch (Utah), the ranking Republican on the Senate Finance Committee, said in a statement Monday. “In response to the first letter I sent with some of my colleagues, Steven Miller, the current Acting IRS Commissioner, responded that these groups weren’t being targeted.” 
 
 “Knowing what we know now,” he added, “the IRS was at best being far from forth coming, or at worst, being deliberately dishonest with Congress.” 
 
 As new details emerged Monday, Democrats and Republicans alike decried the agency’s actions as an unacceptable abuse of power. 
 
 In a news conference Monday, President Obama said he learned of the investigating in media reports on Friday and has “no patience with it.” 
 
 “If in fact IRS personnel engaged in the kind of practices that have been reported on, and were intentionally targeting conservative groups, then that’s outrageous,” Obama said. “And there’s no place for it. And they have to be held fully accountable.” 
 
 White House spokesman Jay Carney told reporters Monday that the White House counsel’s office learned of an upcoming IRS inspector general’s report on April 22 as part of a routine notification but had not received access to the report. 
 
 On Capitol Hill, two Senate panels — the Finance Committee and the Permanent Subcommittee on Investigations — announced Monday that they will investigate. The House Oversight and Government Reform Committee and the Ways and Means Committee have been looking into reports of IRS attempts to single out organizations on the right for heightened scrutiny. Ways and Means has called IRS officials to testify Friday. 
 
 “These actions by the IRS are an outrageous abuse of power and a breach of the public’s trust,” said Senate Finance Committee Chairman Max Baucus (D-Mont.). “The IRS will now be the ones put under additional scrutiny.” 
 
 Separately, Sen. Marco Rubio (R-Fla.) and Rep. Mike Turner (R-Ohio) introduced companion bills Monday that would require the IRS to fire any employee found “willfully” violating “the constitutional rights of a taxpayer,” according to statements by both lawmakers. The bills also would make them criminally liable for their actions. 
 
 Even as Obama vowed that his administration “will make sure that we find out exactly what happened on this,” however, the IRS offered no new information on how it selected which groups to single out for scrutiny. 
 
 The White House is legally barred from contacting the IRS about a tax matter, under a prohibition adopted after the Watergate scandal. And although it can contact the Treasury Department about tax issues, neither Treasury nor the IRS can disclose specific taxpayer information. The IRS can release information about a petition for tax- 
 
 exempt status only after it has been approved. 
 
 Obama is not in a position to remove Lerner, a career official who can be terminated for cause only under normal civil service proceedings. The IRS has two political appointees: the commissioner, who serves a five-year term, and the chief counsel. 
 
 As the IRS came under broader political attack Monday, more details surfaced on how the exempt-organizations division struggled to determine which nonprofits should receive “social welfare” status after the 2010 Citizens United v. Federal Election Commission ruling. That decision, which allowed corporations and unions to raise and spend un­limited amounts of money on elections, opened the door for groups to accept undisclosed contributions as long as their “primary purpose” was not politics. 
 
 In a Jan. 9, 2012, letter to the Richmond Tea Party, IRS specialist Stephen Seok asked questions including “the names of the donors, contributors and grantors,” as well as the size of the contributions and grants, and when they were given. 
 
 
 
 Richmond Tea Party President Larry Nordvig, whose group applied for tax-exempt status in December 2009 and received it in July 2012, said the extended inquiry had “a very chilling effect” on how much money the group could raise because its donors preferred anonymity. 
 
 The Wetumpka Tea Party of Alabama experienced a two-year delay after submitting its initial application. 
 
 Becky Gerritson, a 44-year-old stay-at-home mother and the group’s president, said the IRS sent a questionnaire asking for the names of all volunteers, donor identification and contribution amounts, the names of any legislators its members had communicated with directly or indirectly, and the contents of all speeches its members had made, among a long list of other details. 
 
 “I was outraged,” Gerritson said. “Being an election year, I felt like it was intimidation.” 
 
 The group did not provide the information. Approval came only after the group sought help from the American Center for Law and Justice, which threatened a lawsuit against the IRS, Gerritson said. 
 
 Although some of the groups were explicitly labeled “tea party” or “patriot,” others that came under intense scrutiny were focused on challenging the Affordable Care Act — known by many as Obamacare — or the integrity of federal elections. 
 
 In a June 3, 2011, letter to the IRS, Mitchell questioned the agency’s motivations for delaying recognition of one of her clients who had filed nearly two years earlier, writing, “Is the [group’s] opposition to Obamacare and the takeover of America’s healthcare system by the government the reason that this application has been held up and not approved?” 
 
 Catherine Engelbrecht, president of the Houston-based True the Vote, first filed for tax-exempt status in July 2010. At one point, Engelbrecht — who is still awaiting a determination from the IRS regarding her voting rights organization and a separate tea party group, King Street Patriots — said an IRS employee informed her: “I’m just doing what Washington is telling me to do. I’m just asking what they want me to ask.” 
 
 The IRS did not respond to requests for comment Monday. 
 
 Josh Hicks and Julie Tate contributed to this report. 
 
 Discuss this topic and other political issues in the politics discussion forums.
– The inspector general's IRS report is out (read it in full at the Washington Post, if 54 pages of dry analysis and liberal use of the underline function sound like your thing), and some pundits say it's not exactly as jaw-droppingly scandalous as it was made out to be. The delays for organizations seeking tax-exempt status caused by the IRS heaping extra scrutiny on them is certainly unacceptable, writes Ezra Klein at the Washington Post, but there's "no allegation here of politicization," he writes. Just confusion and incompetence. "The most hotly anticipated IRS probe since Watergate didn't exactly live up to the hype," write Kelsey Snell and Lauren French at Politico, offering some takeaways from the report: First, they agree IRS agents weren't motivated by partisanship, but asking organizations for donor records was burdensome and unnecessary. And the IRS has more work to do to fix the problems: The report makes nine recommendations, but the agency has agreed to only seven. One it hasn't agreed to is drafting new guidelines for how it should investigate politically-oriented groups. But given how touchy the subject is right now, it may not be able to for some time, say Snell and French—and that means it may now be impossible to actually police which groups really are crossing the line.