New York Times, I.R.S. Handling of Donations Draws Ire of Both Parties, by Stephanie Strom:

When it comes to things political, the IRS just cannot seem to win. … [O]n July 7, the IRS announced it was suspending those audits and would not seek gift taxes on donations to 501(c)(4) groups until it had reviewed its policy, which was originally set out in a ruling it issued in 1982.

Now, a group of four anonymous political donors is accusing the agency of playing politics on behalf of those Republicans and demanding that it make a decision immediately about whether the gift tax applies to donations to advocacy groups or not.

“The clear implication left by the IRS action on July 7 is that IRS enforcement activity can be curtailed by intervention from a handful of members of Congress, whatever their party affiliation, when political contributions are at risk,” Marcus S. Owens, the lawyer representing the four complaining donors, wrote in a letter that will be delivered to the tax agency on Monday.

“The July 7 action is like a tumor on the integrity of the IRS because it appears they just caved to political threats,” said Mr. Owens, who formerly led the division of the tax agency that oversees advocacy and other nonprofit groups. “This ought to be a subject for the Treasury inspector general. I cannot recall anything like it happening, at least not after Watergate.”