A conservative legal group filed a lawsuit to demand materials from the Internal Revenue Service (IRS), demanding that the tax agency hand over alleged records “regarding the Biden administration’s plans for race-based tax audits.”
America First Legal (AFL), which was started by Stephen Miller, an aide to former President Donald Trump, filed the lawsuit in the U.S. District Court for the District of Columbia against both the IRS and the U.S. Treasury Department to “compel compliance” with a Freedom of Information Act (FOIA) request that it had opened in February. Neither the IRS nor the Treasury Department has complied with the request, the group alleged, accusing the agencies of “unlawfully concealing records.”
“To date, both the IRS and the Department of the Treasury have refused to comply with the law and turn over records,” said a news release from America First Legal. “To expose the truth, protect the rule of law, and stop federal tax enforcement from becoming a weapon in the equity cult’s ongoing war against our Constitution and equal rights for all Americans, AFL has filed suit.”
According to the complaint and the FOIA request, America First alleged that the IRS and Treasury have “continued to advance ... race-based policies,” making note of a Treasury advisory board’s recommendation that it would report by March 2024 on “changes implemented to correct disparities in tax audits.” IRS Commissioner Danny Werfel also made reference to several changes that could “reduce racial disparities” in tax audits, it said.
Members of that Treasury board also considered whether “people harmed by audit disparities” would receive “redress.”
The complaint referenced a May 2021 meeting in which Treasury Deputy Secretary Wally Adeyemo “met with racial equity experts, economists, and civil rights organizations to discuss the Biden-Harris administration’s tax policies” before the official “reiterated the Treasury Department’s commitment to racial equity as a key factor in the design of tax compliance.”
Later that year, Mr. Adeyemo and Treasury Assistant Secretary Batchelder announced they were “examining the tax system through a racial equity lens,” the complaint noted.
It then cited a 2023 President Biden executive order titled, “Further Advancing Racial Equity and Support for Underserved Communities Through the Federal Government,“ that “prevent and remedy discrimination, including by protecting the public from algorithmic discrimination,” defining that as ”instances when automated systems contribute to unjustified different treatments or impacts disfavoring people based on their actual or perceived race, color, ethnicity … or any other classification protected by law.”
“Despite Congress’s prohibition on the IRS’s direct collection of taxpayer race and ethnicity data, the IRS worked with other parts of the Department and the Census Bureau to “obtain micro-data on race and ethnicity” and “impute race and ethnicity for tax data,” the complaint said.
Last year, the group said that the 2023 executive order suggests the administration wants to alter the IRS’s “audit algorithms to target white, Asian, or mixed-race taxpayers.”
According to the earlier complaint, the IRS’s National Research Program, which randomly selects tax returns to audit, might be influenced by the order along with other executive actions.
In public announcements, the IRS has mainly focused on issuing statements on how it has increased the number of audits targeting wealthy Americans, namely those who haven’t filed their tax returns since 2017. No mentions of race or ethnicity have been made in that context, however.
“When people don’t file a tax return they’re required to, it’s not fair to those hardworking taxpayers who responsibly do their civic duty under the laws of our nation,” Commissioner Werfel told reporters several months ago. “And when people don’t file their taxes, they need to know there’s a consequence.”
In February, the IRS leadership said the agency will start up dozens of audits on businesses’ private jets and how they are used personally by executives and written off as a tax deduction. And earlier this year, the agency announced it had collected roughly half a billion dollars in overdue taxes from delinquent millionaires.
“In a woke world, nothing can be said to be certain, except death, taxes, and racism. Months ago, the Biden administration actually changed tax audit policies to further advance its divisive equity agenda, and its radical allies are now pushing for even more. No American should worry whether the IRS is more likely to audit them this year than last year because of their race.” said America First Legal’s Michael Ding in a news release.
Neither the IRS or the Treasury Department has responded to the lawsuit. The Epoch Times contacted the Treasury Department, which oversees the IRS, for comment Friday.
