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IRS head is getting questioned by lawmakers after former FBI officials were audited

Internal Revenue Service Commissioner Charles Rettig prepares to testify before the Senate Finance Committee on the IRS budget for fiscal year 2023 at the Capitol in April 7. He'll face questions from a House committee today on why the IRS audited two former FBI leaders who investigated Donald Trump's 2016 campaign.
J. Scott Applewhite
/
AP
Internal Revenue Service Commissioner Charles Rettig prepares to testify before the Senate Finance Committee on the IRS budget for fiscal year 2023 at the Capitol in April 7. He'll face questions from a House committee today on why the IRS audited two former FBI leaders who investigated Donald Trump's 2016 campaign.

Lawmakers will question IRS head Charles Rettig on Thursday regarding a report from the New York Times last week that showed two former top FBI officials, who were critical of former President Donald Trump, had been audited by the agency in 2017 and 2019.

Former FBI Director James Comey and former Deputy Director Andrew McCabe led investigations into Russian interference in the 2016 election and possible coordination with Trump's campaign. Both men were fired from their posts in 2017 and 2018, respectively.

"We are working on getting to the bottom of these stunning allegations," House Ways and Means Committee Chairman Rep. Richard Neal, D-Mass., said in a statement.

The committee will hold a closed-door meeting Thursday with Rettig, who was appointed by Trump in 2018 and retained his post in the Biden administration. Members from both parties will be able to ask Rettig questions directly. The meeting is not open to the media or public due to the personal financial information involved.

Rettig is also set to meet with senators on July 26, in another closed-door meeting, according to Senate Finance Committee Chair Sen. Ron Wyden, D-Ore.

"Reporting that former FBI Director James Comey and former Deputy FBI Director Andrew McCabe were audited by the IRS has raised serious concerns about the possibility that former President Trump encouraged the IRS to investigate his perceived enemies," Wyden said in a statement provided to NPR.

Upon the direction of Rettig, the IRS' watchdog organization, Treasury Inspector General for Tax Administration, has also launched an investigation.

The kind of audit Comey and McCabe underwent helps calculate the tax gap

Comey and McCabe's tax audits are what are called National Research Program, or NRP, audits. These are used to calculate the tax gap, Amber Gray-Fenner, an enrolled agent and tax writer in New Mexico, tells NPR.

"The tax gap arises not from people who have W-2 earnings and are maybe inflating their schedule, their itemized deductions a bit," Gray-Fenner says. Instead, the gap comes from people who have income from things like rental properties, people who are self-employed or people who get book royalties — all things that may not get reported on a formal tax form.

Gray-Fenner says these kinds of audits can be invasive. But the process is determined by an algorithm. And while it can seem like slim odds that both Comey and McCabe could be randomly selected — the Times story said 1 in 30,600 — the pool taxpayers the IRS selected from was already small, Gray-Fenner said.

"They are looking for people specifically who have a lot of income but it's not reported ... the pool of taxpayers they were selected from, they weren't selected by name, but by criteria," Gray-Fenner said.

"Is it odd that two formerly high-ranking government officials got picked? Maybe, maybe not," Gray-Fenner said. "I'm not saying it couldn't happen, I'm not saying it didn't happen, I'm just saying it's not as statistically unlikely as the original New York Times story indicated."

Gray-Fenner added that conclusions shouldn't be drawn until the IG investigation is complete.

"Wait for the investigation. And don't give in to outrage or conspiracy theory," Gray-Fenner said.

Neal also called for more information through the investigation and through the House committee's questions.

"We need more information on the National Research Program, and for Rettig, as well as his chief of staff, to shed more light on how these men could possibly be 'randomly' selected," Neal said. "I've seen the odds, and it's clear there's more to know."

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Deepa Shivaram
Deepa Shivaram is a multi-platform political reporter on NPR's Washington Desk.