IRS Hearing Will Pit D.C. Officials Against Cincinnati Agent

by Eliana Johnson

Thursday’s Oversight Committee hearing on the IRS’s targeting of tea-party groups is likely to be a showdown between Internal Revenue Service officials based in Washington, D.C., and a Cincinnati agent who accused them of micromanaging her work. Oversight Committee chairman Darrell Issa is calling Washington lawyers Carter Hull and Steven Grodnitzky as well as a Cincinnati-based agent, Elizabeth Hofacre, to testify on Thursday, according to a congressional source. 

In her interview with committee investigators, Hofacre accused Hull of micromanaging her processing of tea-party applications from Washington. “I was essentially a front person,” she said, “because I had no autonomy or no authority to act on them without Carter Hull’s influence or input.” Hull also appears to have caused some of the delays experienced by tea-party groups who applied for tax exemption. According to Hofacre, she eventually stopped receiving feedback from him and, as a result, tea-party groups stopped getting responses from her as their applications languished on his desk. 

Hull requested his retirement package from the IRS in March and officially left the agency this month. During the period he worked with Hofacre, Grodnitzky served as his manager, running the Exempt Organizations Technical Unit in Washington. Holly Paz, the IRS’s former director of Rulings and Agreements, told investigators that it was Grodnitzky who assigned Hull to work on the tea-party cases; Hofacre testified that Grodnitzky was in some cases providing guidance on contents of the questionnaires sent to the groups. 

The witnesses called to the hearing reflect the shift in the committee’s investigation away from the IRS’s Cincinnati office and toward the agency’s headquarters in Washington. Questions from lawmakers are likely to focus on who in D.C. asked that tea-party applications be elevated for review, who wrote and approved the intrusive questions sent to so many groups, and why their applications were not processed efficiently.