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Posts Tagged ‘IRS’
January 7th, 2015 at 11:02 am
IRS Tax Refunds Could be Much Smaller Under ObamaCare This Year

Anyone still looking for a fundamental change to the federal tax code need look no further than ObamaCare.

H&R Block, one of the nation’s largest tax preparation companies, is promoting its free “ACA Tax Impact Analysis” on January 8, 2015, in order help taxpayers understand the true cost of ObamaCare.

Reporting by The Hill quotes an H&R Block executive as saying that the controversial health law is “the biggest tax code change” in two decades. Its passage “has made health care a tax issue and is going to make filing taxes more complicated this year.”

Perhaps the biggest surprise coming to millions of taxpayers is the penalty amount to be assessed for not complying with the law’s individual mandate. Most people know that the IRS can levy a $95 fine for being uninsured this year (which rises every subsequent year). But many do not realize that’s only one option. ObamaCare authorizes fines up to 1% of annual income (which also rises every year), if that amount is greater than $95.

Simply put, a lot of people who passed on ObamaCare’s costly version of “affordable” insurance thinking they would only have to write a $95 check may be missing a much bigger chunk of their IRS refund this year.

November 21st, 2014 at 9:09 am
Podcast: Don’t Let IRS Off the Hook
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In an interview with CFIF, True the Vote founder Catherine Engelbrecht discusses a federal judge’s decision to dismiss the lawsuit filed by True the Vote against the Internal Revenue Service for targeting the conservative organization and improperly delaying its application for tax-exempt status, how liberals are attempting to silence their critics, and the status of election integrity.

Listen to the interview here.

November 12th, 2014 at 6:20 pm
ObamaCare’s 2015 Tax Bite

Too bad the incoming Republican majority in Congress probably can’t repeal ObamaCare’s individual mandate before next April, because it looks like millions of middle-income Americans will see their tax refund cut by one-third.

“The financial penalty for skipping out on health insurance coverage [i.e. not complying with the individual mandate] will more than triple to $325 per person in 2015, or 2 percent of income, depending on whichever is higher,” reports CBS News. “Children will be fined at half the adult rate, or $162.50 for those under 18 years old.”

“Based on the flat-rate method, the maximum dollar amount an uninsured family could be fined is $975,” says the news outlet.

To put this into perspective, the average annual American tax refund is about $3,000, meaning that a $975 IRS penalty would reduce the value by one-third.

This is likely to hit middle-income Americans particularly hard since many may be earning too much in wages or salary to qualify for an ObamaCare subsidy. The Catch-22 facing these families is cutting back on other spending to pay high monthly premiums, or foregoing insurance and waiting to see how much the IRS will confiscate. Either way, the predicament facing millions of middle-income Americans is likely to make them even more hostile toward a law billed as the “Affordable Care Act.”

October 8th, 2014 at 3:50 pm
Report: IRS Failed to Disclose Info in 100s of Cases

The IRS is out-of-control.

In the last year we’ve learned that Lois Lerner and other officials in the tax-exempt unit singled out conservative groups for extra scrutiny before approving their requested non-profit status.

That was followed by revelations from IRS higher ups that they mysteriously lost thousands of emails from Lerner and others during the timeframe of interest to congressional investigators.

Last week, a private jet company alleged that the IRS “wiped clean a number of computer hard drives containing emails and other electronic documents that the Government was required to produce.”

And now this.

“The Internal Revenue Service wrongly withheld or failed to adequately search for records in hundreds of Freedom of Information Act requests, while accidentally releasing sensitive taxpayer information in other instances, an independent government watchdog found,” reports the Washington Free Beacon.

The Beacon is summarizing an analysis released by the Treasury Inspector General for Tax Administration (TIGTA).

“TIGTA sampled FOIA requests to the IRS and found 11 percent ‘in which taxpayer rights may have been violated because the IRS improperly withheld or failed to adequately search for and provide information to the requestors’.”

As an independent federal agency, the IRS has a grave obligation to be accountable to the citizens it serves, either directly through FOIA requests or indirectly through congressional oversight panels. That the IRS seems chronically incapable – and increasingly, it seems, unwilling – to honor due process and the rule of law is reason enough to launch a full-scale reconsideration of what the agency does, how it does it and what kind of people should be entrusted to follow the rules.

October 3rd, 2014 at 11:24 am
ObamaCare Nearing a Fannie and Freddie-Style Bailout of Insurance Companies?

Could ObamaCare’s “risk corridor” program become the health insurance industry’s equivalent of Fannie Mae and Freddie Mac – the federally funded entities that spent $180 billion bailing out banks who issued subprime mortgages?

Stephen Moore, the chief economist at the Heritage Foundation, thinks so.

“But insurance experts warn that [the risk corridor] program creates the same moral hazard problem for health insurance that we saw in the mortgage market with Fannie Mae and Freddie Mac,” Moore writes at Investor’s Business Daily. “The guarantee on bad mortgages encouraged bad mortgages. The guarantee against losses on ObamaCare enrollees encourages insurers to toss sound underwriting standards out the window. This didn’t turn out so well with Fannie and Freddie, which received a taxpayer-funded bailout of more than $180 billion after issuing subprime mortgages that should never have been written.”

Moore goes on to say that surveys of health insurance companies selling plans on ObamaCare exchanges say that the vast majority expect to receive a payment from the federal government to cover their losses. Estimates for the first year near $1 billion. And, since there is no cap to how much the feds will reimburse, there is no limit to how much money a company can lose and still expect a check from Uncle Sam.

Despite all this, the Obama administration is chugging ahead with plans to make payments under the risk corridor program without explicit congressional appropriations. Republicans are contesting President Barack Obama’s authority to do this – with an assist from a recent GAO legal opinion – but they should really train their fire on eliminating the risk corridor program as is. As with IRS tax credits, ObamaCare can’t survive without a convoluted shell game that hides the true cost of health care.

We’ll never get health care policy right until we can talk honestly about how it’s funded. Now would be a good time for the GOP to being that process.

October 1st, 2014 at 6:29 pm
GAO Says CMS Lacks Authority to Bail Out ObamaCare Insurers

It’s been a rough couple of weeks for power-hungry bureaucrats.

Recently, the General Accountability Office (GAO) issued a report faulting the Centers for Medicare and Medicaid Services (CMS) for being unable to produce itemized spending documents, and thus not complying with federal audit guidelines.

This week, the non-partisan government watchdog agency issued a legal opinion saying CMS does not have the authority to bail out ObamaCare-aligned insurance companies, unless Congress agrees.

GAO’s non-binding but influential legal opinion was generated by a request from congressional Republicans concerned about a CMS announcement that it would use money appropriated for other activities to fund ObamaCare’s “risk corridor” program.

Risk corridors refer to a scheme within ObamaCare to compensate insurance companies who lose more than a specified amount of money covering high-cost patients. Initially, funds are redistributed from highly profitable companies. But if the losses exceed a certain threshold, federal taxpayers step in via CMS, the primary agency implementing ObamaCare.

With all of ObamaCare’s pricey mandates – most importantly “guaranteed issue,” which requires insurers to enroll customers with preexisting conditions – there is concern that significant losses among participating companies could put taxpayers on the hook to bailout several firms in the health insurance industry.

It’s worth noting that GAO released its legal opinion on the same day Federal District Judge Ronald A. White struck down a similar bureaucratic power grab by the Internal Revenue Service. While the timing is unconnected, the central issue is not. In both cases agencies within the Obama administration are attempting an end run around the plain meaning of a statute in order to make the president’s legacy program appear to work better than it is.

The rule of law is more important than avoiding bad press for a poorly written bill. Bravo to the GAO and Judge White for having the courage to hold the executive branch accountable.

September 10th, 2014 at 7:14 pm
IRS re Lost Emails: Oops, We Did It Again

The Obama administration has a penchant for releasing damaging disclosures on Fridays.

The most recent example was last Friday’s admission by the IRS that – in addition to losing potentially incriminating emails from Lois Lerner’s account – it also can’t find emails from five other employees connected to the conservative targeting scandal.

Two of the five worked in the agency’s Cincinnati office where most of the bad behavior took place. The others include Lerner’s technical adviser, a group manager in the tax-exempt division and a tax law specialist, reports Fox News.

The IRS says all five permanently lost access to emails sought by congressional investigators when their hard drives crashed. The agency’s Inspector General is testing the drives to see if any emails can still be recovered.

Republicans in Congress are not amused.

“The IRS’s ever-changing story is practically impossible to follow at this point, as they modify it each time to accommodate new facts,” Rep. Darrell Issa (R-CA), Chairman of the House Oversight Committee, said. “This pattern must stop.”

More likely it will continue.

August 27th, 2014 at 6:59 pm
IRS Erased Lois Lerner’s Blackberry AFTER Investigation Began

It’s been a rough five days for the Internal Revenue Service.

Last Friday attorneys at Judicial Watch, a conservative watchdog group, said Department of Justice lawyers revealed a second back-up system that stores all government emails.

Presumably, this includes the emails to and from former IRS manager Lois Lerner’s account; emails that are sought by investigators on the House Oversight Committee because of Lerner’s connection to the potentially illegal targeting of conservative advocacy groups.

If true – DOJ officials are disputing Judicial Watch’s account of the conversation – this casts a serious shadow on the IRS’s credibility, since Commissioner John Koskinen told Congress under oath that the emails had been lost in a hard drive crash.

However many back-up systems there are – and whether Koskinen knew the number – the Commissioner has another integrity crisis brewing.

“Thomas Kane, Deputy Assistant Chief Counsel for the IRS, wrote in a declaration, part of a lawsuit filed by Judicial Watch against the IRS, that [Lois Lerner’s] BlackBerry was ‘removed or wiped clean of any sensitive or proprietary information and removed as scrap for disposal in June 2012,” reports Fox News.

The date is significant because congressional staff members had already interviewed Lerner about her role in the targeting operation. Deleting messages from her government-owned smartphone after that meeting – but before preserving the contents– looks like a thinly veiled attempt to destroy evidence.

The House Oversight Committee will have its hands full when Congress returns from its August recess.

Expect to see some high-profile hearings.

August 26th, 2014 at 7:57 pm
DOJ: We Have Lois Lerner’s “Lost” Emails

Apparently, you can lie to Congress but not to Judicial Watch.

The conservative watchdog organization is publicizing an admission by the Department of Justice that government officials can access emails reportedly lost in a hard drive crash.

The messages – correspondence to and from former IRS manager Lois Lerner – have been sought by congressional investigators seeking more information about the agency’s targeting of conservative advocacy groups filing for tax-exempt status.

In sworn testimony, IRS officials have told members of Congress that thousands of emails sent from Lerner’s government account could not be retrieved because a back-up system had also been erased.

But now attorneys at the DOJ are singing a different tune.

“Judicial Watch President Tom Fitton said Justice Department lawyers informed him that the federal government keeps a back-up copy of every email and record in the event of a government-wide catastrophe,” reports the Washington Examiner.

That includes Lerner’s IRS emails.

But don’t expect them to be produced anytime soon. The DOJ is claiming that the newly revealed back-up system would be “too onerous to search,” but did say that Treasury Department inspectors are looking into it.

While the litigators wrangle, we’re left with yet more evidence that the Obama administration doesn’t mind playing fast and loose with the truth – even under oath.

The House of Representatives already voted back in May to hold Lerner in contempt of Congress for refusing to testify; making her the second administration official after Attorney General Eric Holder to receive such a dishonor.

If it’s true that top IRS brass lied under oath to Congress about the whereabouts of Lerner’s potentially damaging emails, one wonders what message House leadership would send to this latest act of executive defiance.

August 23rd, 2014 at 5:20 pm
Podcast: Lawsuit Further Exposes IRS Scandal
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In an interview with CFIF, Lori Lowenthal Marcus, Co-founder and President of Z STREET, discusses her organization’s ongoing lawsuit against the IRS, and how an IRS employee informed her that her organization’s tax exempt status application was delayed because the group was “connected with Israel” and expressed opposition to the Obama Administration’s foreign policy.

Listen to the interview here.

August 14th, 2014 at 3:25 pm
Like IRS, CMS Emails Go Missing

It looks like Lois Lerner – the former IRS manager at the center of the scandal targeting conservative groups – isn’t the only Obama administration official who lost emails subpoenaed by Congress.

Marilyn Tavenner, the head of the Centers for Medicare and Medicaid Services, is now believed to have deleted emails sought by congressional investigators trying to understand why Healthcare.gov had such a horrendous rollout.

“In order to stay below the agency’s Microsoft Outlook email size limit, Tavenner would regularly delete emails after copying or forwarding them to her staff for retention,” says the MSNBC report that broke the story. “However, Tavenner didn’t follow that procedure every time, meaning some emails never made it to her staff for safekeeping before being deleted.”

That could turn out to be a costly oversight for Tavenner.

As Jillian Kay Melchior points out, “Federal law tasks heads of all federal agencies with ‘mak[ing] and preserv[ing] records containing adequate and proper documentation of the organization, functions, policies, decisions, procedures, and essential transactions of the agency and designed to furnish the information necessary to protect the legal and financial rights of the Government and of persons directly affected by the agency’s activities.’”

Unlike Lerner who claims her IRS computer crashed taking with it unrecoverable emails – a claim disputed by IT experts inside and outside the tax-gathering agency – Tavenner, at best, is pleading that she’s too busy to follow the law. At worst, she’s the latest Obama administration official caught skirting her legal obligations to hide inconvenient truths.

To my knowledge, Tavenner isn’t considered an overt Obama loyalist, so it’s possible that the missing emails are a genuine oversight by a busy administrator. The trouble is, Tavenner works in an administration seemingly filled with people who are unwilling to comply with the kind of document sharing necessary for the people – through Congress – to understand and judge what unelected bureaucrats are doing. One of the tragedies of bad behavior by some is the suspicion it casts on everyone else on the team.

So be it.

Darrell Issa (R-CA), Chairman of the House Oversight Committee, has already pledged to hold hearings on alleged wrongdoing by agency heads when Congress returns from its August recess.

Don’t be surprised to see a hearing scheduled to get the truth about Tavenner’s missing emails.

August 11th, 2014 at 2:24 pm
HHS to Fund Coming ObamaCare Bailout of Insurance Companies

What makes conservatives so sure that the Obama administration will bailout insurance companies losing money under ObamaCare?

“According to a recent investigation conducted by the House Oversight and Government Reform Committee chaired by Darrell Issa, insurers widely expect to receive funds from the bailout program,” writes U.S. Senator Marco Rubio (R-FL). “One large insurer recently filed financial statements claiming they expect part of their revenue to come from American taxpayers via the ObamaCare bailout ‘fund.’”

Thwarted by the GOP majority in the U.S. House of Representatives who refuse to appropriate money for this part of ObamaCare, the Department of Health and Human Services “figured out a way to use general funds available through the Centers for Medicare and Medicaid Services to pay off health insurers,” says Rubio. “The effect is to circumvent Congress’ power of the purse for the purpose of bailing out health insurers with taxpayer funds.”

Whether it’s the CIA lying about spying on congressional investigators or IRS officials conveniently losing potentially damaging emails, executive branch officials in the Obama administration are destroying the ability of anybody outside their clique from being able to trust anything they say.

August 7th, 2014 at 6:18 pm
Would President Romney Be Allowed to Disregard the Law?

Robert Delahunty, a former Department of Justice attorney, poses an interesting counterfactual to those defending President Barack Obama’s possible legalization of 5 million illegal immigrants.

“One has to wonder how those who consider such non-enforcement to be constitutional would react if a President Mitt Romney announced that his Internal Revenue Service would simply stop collecting capital gains tax on the rich, or that his Environmental Protection Agency would no longer seek to impose legal penalties on polluters,” writes Delahunty.

Delahunty’s thought experiment is worth elaborating. If it’s true that presidents can assume lawmaking powers when Congress refuses to implement his will – a point I’m only granting for the sake of argument; Articles I and II of the Constitution clearly foreclose this possibility – then it stands to reason that any Republican running for president in 2016 can simply campaign on a promise not to enforce any law he does not like. Why worry with winning control of Congress? All any political party needs to do is win one race – the presidency – and the entire executive branch can be put in the service of the party’s platform.

It’s an outcome so at odds with our constitutional system that in saner days it would have been ruled out as a serious option as soon as it was floated. But we are in transformative times. Future presidents and their would-be advisors are taking notes. If President Obama is allowed to get away with such a regime-shattering power grab – and unilaterally importing 5 million new citizens would be just that – then there is very little reason to justify limits on even bigger abuses hereafter.

July 24th, 2014 at 2:20 pm
ObamaCare’s Eligibility Verification System Open to Abuse

The Government Accountability Office set up a sting operation to test whether ObamaCare’s eligibility verification system is open to abuse.

GAO discovered a resounding Yes.

“Fake applicants were able to get subsidized insurance coverage in 11 of 18 attempts,” reports National Journal.

Investigators had the most success when using ObamaCare’s online and telephone enrollment systems. These improper enrollments resulted in subsidies totaling $30,000 annually.

The findings of the sting operation bode ill for the controversial health reform law. The failure to correctly match applicants to subsidies indicates that ObamaCare’s expensive digital architecture is failing in one of its most basic tasks.

And the failure could be costly.

Assuming most ObamaCare applicants are not attempting to defraud taxpayers – but rather are just trying to comply with the law’s individual mandate – incorrectly receiving financial help this year could result in a heavier tax bill next year. That’s because the IRS is tasked with settling accounts on ObamaCare subsidies, with taxpayers required to pay back any subsidies they weren’t eligible for when calculating their income tax liability.

So far, the IRS hasn’t rewritten ObamaCare to cushion the blow from bad drafting – like it did when it made subsidies available to citizens in states without a state-based exchange.

Apparently, that kind of face-saving deference is only extended to government-growing ideologues; not every day Americans just trying to play by the rules.

July 7th, 2014 at 8:59 am
Podcast: The “Lost” IRS Emails
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In an interview with CFIF, Hans von Spakovsky, Manager of the Election Law Reform Initiative and Judicial Studies at The Heritage Foundation, discusses Lois Lerner’s “lost” e-mails, how the Justice Department is not taking the IRS investigation seriously and other recent IRS scandals.

Listen to the interview here.

June 25th, 2014 at 2:25 pm
Isn’t Not “Following” the Law the Same as Breaking It?

No one wants to be David Ferriero right now.

He’s the U.S. Archivist, the man in charge of keeping all of the federal government’s records for posterity.

Apparently though, no one told the IRS. Twelve days ago the agency revealed that it has conveniently lost two years’ worth of emails from Lois Lerner, the former IRS supervisor at the center of a scandal that targeted conservative groups for extra scrutiny.

“Any agency is required to notify us when they realize they have a problem,” Ferriero told a House Oversight committee panel. One imagines that an alleged hard drive failure vaporizing thousands of emails qualifies as just such a problem.

By law, the IRS is supposed to alert Ferriero within days. He wasn’t notified until earlier this month – about three years after the crash occurred.

When pressed, all Ferriero would say is that the IRS did not “follow” the law. He would not say the agency broke the law.

It doesn’t matter. The truth is obvious. Every new revelation in the IRS scandal only serves to harden the perception that so-called public servants abused their positions.

June 24th, 2014 at 9:18 am
Must See IRS TV: Trey Gowdy Schools IRS Commissioner Koskinen
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At a House Oversight Committee hearing last night, IRS Commissioner Koskinen was on the hot seat regarding the “lost” emails of Lois Lerner and other employees implicated in the IRS targeting scandal.  The tough line of questioning by Congressman Trey Gowdy (R-SC) is a must see.

May 22nd, 2014 at 6:29 pm
A Victory for Political Freedom
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From the USA Today:

WASHINGTON — The Internal Revenue Service said Thursday it would start over on its controversial rule limiting the political activity of certain tax-exempt groups, propose a new rule that would take into account a backlash of opposition.

The announcement made official what IRS Commissioner John Koskinen told USA TODAY last month — that the IRS would put out a new proposal and seek more public comments before overturning a 57-year-old precedent allowing certain tax-exempt groups to engage in limited amounts of political activity.

Great news, though, alas, it sounds like the IRS will come back for another bite at this apple. Still, this buys time for those who believe that this entire endeavor is a misbegotten exercise in letting government narrow the parameters of political engagement.

There are few threats to freedom as great as allowing those in power to control what those out of power — which may be liberals one year and conservatives the next —can do or say about politics. Any truly ‘liberal’ society gives the opposition room to flower. May the IRS never complete this exercise.

The announcement made official what IRS Commissioner John Koskinen told USA TODAY last month — that the IRS would put out a new proposal and seek more public comments before overturning a 57-year-old precedent allowing certain tax-exempt groups to engage in limited amounts of political activityWASHINGTON — The Internal Revenue Service said Thursday it would start over on its controversial rule limiting the political activity of certain tax-exempt groups, propose a new rule that would take into account a backlash of opposition.
The announcement made official what IRS Commissioner John Koskinen told USA TODAY last month — that the IRS would put out a new proposal and seek more public comments before overturning a 57-year-old precedent allowing certain tax-exempt groups to engage in limited amounts of political activity.
May 20th, 2014 at 1:28 pm
Feds Can’t Verify Over 1 Million Income Statements Seeking ObamaCare Subsidies

Amid all the legitimate privacy concerns with ObamaCare’s regulatory apparatus – in particular the proposed data hub that allows agencies like the IRS, Social Security Administration and HHS to share reams of information about individual citizens with each other, states and insurance companies – it’s been taken for granted that the liberals in charge of this grand social experiment at least had the technical competency to build the necessary infrastructure.

But the facts say otherwise.

“Of the roughly 8 million Americans now signed up for coverage this year under the health care law, about 5.5 million are in the federal insurance exchange,” reports the Washington Post. “And according to internal documents, more than half of them – about 3 million – have an application containing at least one kind of inconsistency.”

The Post says the most frequent inconsistency is a discrepancy in the income reported on an ObamaCare application and the income reported to the IRS. This type of inconsistency is present on between 1.1 million and 1.5 million applications. To their credit, citizens have sent in “about 650,000 pieces of ‘proof’” to justify their asserted income.

Because of the level of detail required when filling out the 20-plus page ObamaCare application, it’s no surprise many people mistakenly enter something wrong; especially when considering that most people get help on their taxes from either a certified professional or software that easily finds all the right deductions. Neither option was readily available to the vast majority of ObamaCare applicants.

What is astonishing, however, is the federal government’s complete inability to process and verify corrections digitally. “Because the computer capability does not yet exist, the work will start by hand, according to two people familiar with the plans,” says the Post. (Emphasis added)

ObamaCare subsidies are the essential ingredient for claiming that ObamaCare insurance is “affordable” since they at least partially offset the increased cost of coverage. Failing to launch a website capable of verifying income claims that determine whether a person qualifies for subsidies is inexcusable.

If there is any silver lining to this latest blunder it’s that Serco – the federal contractor accused last week of billing HHS $1 billion while hiring employees literally to do nothing – is now on the hook for correcting the inconsistencies. Small comfort though, since apparently Serco gets paid based on the number of employees it hires rather than the efficiency of its work product. Requiring the company to sort paper applications by hand seems almost too awful to be true.

May 12th, 2014 at 3:43 pm
New Poll: Majority of Americans Care About IRS/Lois Lerner Scandal, Too
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In last week’s Liberty Update, we debunked the claim by the Obama Administration, its Democratic Congressional apologists and the mainstream media that the Benghazi scandal is something about which Americans just don’t care.  According to a Rasmussen survey released last week, 51% say that the Benghazi affair merits further investigation, while just 34% disagree:

One can only imagine survey data on the matter if the media had bothered to cover it as it deserves.  Or, perhaps more to the point, if a Republican president presided over the attack and political coverup.  Nevertheless, it’s an encouraging sign that the American public not only expresses concern, but prefers continued investigation.  That should encourage Congressional leaders and media to get to the bottom of this important matter.”

Today, there’s more encouraging news in that regard.  Rasmussen also reports that a clear majority of Americans also say the ongoing IRS/Lois Lerner scandal merits further investigation:

Half of voters still believe the IRS broke the law when it targeted Tea Party and other conservative groups, and even more think the matter needs to be looked into further.  A new Rasmussen Reports national telephone survey finds that 57% of likely U.S. voters think the Obama administration’s handling of the IRS matter merits further investigation.  Just half as many (28%) say the case should be closed.  Fifteen percent (15%) are not sure.”

Both Benghazi and the IRS persecution of conservative groups are critical matters, and Americans shouldn’t allow the Administration to bury them.  Fortunately, that’s not the case, which should encourage the media and members of Congress to pursue the truth in both cases in a responsible, thorough, public manner.