Remember the IRS scandal? It faded from the headlines, but it never ended, as the IRS never actually changed its behavior.
One of the organizations that the IRS has been discriminating against is Z Street, a pro-Israel group. Z Street sued the IRS, demanding that its tax exempt application be considered in a fair process. The IRS argued in court that Z Street had no right to a fair process.
No kidding, that’s exactly what they argued. The IRS argued that, since Z Street could appeal the rejection of its application after nine months, they had no need for legal action:
The agency argued that Z Street was seeking non-profit status, and that this could be remedied outside of court if the group waited for the government-prescribed 270-day period process where it was not subject to discriminatory delays because of its positions on Israel.and then petitioned the for an IRS ruling.
However, Z Street argued that it was not seeking non-profit status, but rather a fair application process where it was not subject to discriminatory delays because of its positions on Israel.
During the hearing, Chief Judge Merrick Garland was highly critical of the IRS’s defense.
“You don’t really mean that, right?” said Judge Garland to the IRS attorney. “Because the next couple words would be the IRS is free to discriminate on the basis of viewpoint, religion, race [for 270 days]. You don’t actually think that?” . . .
While the panel of judges was more subdued in the Friday ruling, it still dismissed the government’s argument against Z Street.
What possible reason is there to suppose that that isn’t exactly what the IRS thinks? We’ll have the opportunity to find out now, as Z Street finally has the right of discovery.