In a new revelation, ex-agency official Lois Lerner -- a key figure in the IRS targeting scandal -- allegedly dismissed complaints that labor unions were not reporting millions of dollars in political activities on their tax forms, according to an email obtained by The Daily Caller News Foundation. Since labor union political spending is known to overwhelmingly benefit Democrats, Lerner may have been playing favorites.
In 2007, a complaint was issued to Lerner, then Director of Exempt Organizations at IRS, that some major labor unions were submitting completely different amounts of political expenditures when filing with the IRS and the Department of Labor.
"We looked at the information you provided regarding organizations that report substantial amounts of political activity and lobbying expenditures on the DOL Form LM-2, but report little to no political expenditures on the Form 990 filed with the IRS," Lerner responded to the complaint.
"We believe this difference in reporting does not necessarily indicate that the organization has incorrectly reported to either the DOL or the IRS," Lerner concluded.
Don Todd, the deputy assistant secretary of the Office of Labor-Management Standards (OLMS) at the time the email was sent, confirmed seeing Lerner's email and remembering similar complaints at the time. OLMS oversees labor union financial disclosures within the Department of Labor.
"The laws never been enforced," Todd told TheDCNF. "The IRS was telling us it would cost more to enforce the law then they would collect."
In 2006, the year leading up to Lerner's email, the national headquarters for the AFL-CIO reported no direct or indirect political expenditures with the IRS on their 990 form, leaving the line 81a blank. That same year, the AFL-CIO reported $29,585,661 in political activities with the Department of Labor.
"Also in 2006 the Teamsters Union reported no political expenditures with the IRS while at the same time reporting $7,081,965 with the Labor Department," according to Fox News. "Again in 2006, Unite-Here reported no political activity with the IRS and $1,451,002 with the Labor Department."
"In 2005, the National Education Association also reported no political expenditures with the IRS while at the same time reporting $24,985,250 with the Labor Department."
In a 2007 email, Lerner acknowledged, "The definition of political campaign activity required to be reported on Form LM2 coincides with the definition of political campaign activity expenditures required to be reported on Form 990."
However, she did offer some possible reasons for the discrepancies. "The Form LM-2 does not separate this reporting from the reporting of lobbying expenditures," she wrote. "Furthermore, even if section 501(c)(5) labor organizations were required to report their lobbying expenditures, the amount required to be reported on Form LM-2 includes activity, such as attempting to influence regulations, that is not required to be reported as lobbying, as the IRS limitations apply to legislative lobbying."
"Having said that, we did see some instances that raised concerns and we referred that information to our Dallas office to determine whether examination is warranted," she conceded.
It does not appear that any further investigation was conducted, according to the Daily Caller.
An IRS spokesman told TheDCNF the agency had no "immediate comment" on the matter.