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5 unanswered questions about the IRS targeting of conservative groups

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President Barack Obama speaks during a joint news conference with British Prime Minister David Cameron at White House on Monday.

Outrage intensified in Washington on Monday over the disclosure that the Internal Revenue Service targeted conservative groups for special scrutiny when they applied for tax-exempt status.

President Barack Obama, at a White House appearance with the British prime minister, said that he wanted all the facts but used strong terms to condemn the reported conduct.

“I’ve got no patience with it. I will not tolerate it,” he said. “And we will make sure that we find out exactly what happened on this.”

The Treasury Department’s inspector general for tax administration will release an audit report later this week. In the meantime, here are five big unanswered questions looming over the IRS.

How did this start and why?

In January 2010, a Supreme Court decision known as Citizens United touched off a flood of political spending, much of it classified under a section of tax law known as 501(c)4 that entitles certain “social welfare” groups to tax exemption.

Two months later, a special unit of the IRS in Cincinnati assigned to screen applications for 501(c)4 status began searching for groups with descriptions that included “Tea Party” and “Patriots,” according to a partial draft of the inspector general’s report obtained by NBC News.

Lois Lerner, head of the IRS division on tax-exempt organizations, said Friday that the targeting of conservative groups was “inappropriate” but “absolutely not” influenced by the White House. She also said that none of the targeted groups was denied tax-exempt status.

What has not been spelled out is who in the Cincinnati office decided to search for conservative groups and why.

At least one Tea Party group called on the administration Monday to appoint a special prosecutor to look into the matter, which it called “un-American and Nixonesque.” One of the articles of impeachment against President Richard Nixon accused him of targeting political opponents for tax audits.

Both Republicans and Democrats in Congress are determined to investigate.

“I just don’t buy that this was a couple of rogue IRS employees,” Sen. Susan Collins, R-Maine, said Sunday on the CNN program “State of the Union.”

Who knew what, and when, higher in the IRS?

Lerner learned in June 2011 that agents had targeted groups with names including “Tea Party” and “Patriots,” according to the draft obtained by NBC News.

She “instructed that the criteria immediately be revised,” according to the draft. Ten months later, in March 2012, the IRS commissioner at the time, Douglas Shulman, testified to Congress that the IRS was not targeting tax-exempt groups based on their politics.

The IRS said over the weekend that senior executives were not aware of the targeting, but it remains unclear who knew what and when. Shulman, who left the agency last fall, has not spoken publicly about the scandal and did not answer a request for comment Monday from NBC News.

Members of Congress had sent letters to Shulman as early as June 2011 asking specifically about targeting of conservative groups, according to a House Ways and Means Committee summary obtained by NBC News.

The IRS responded at least six times but made no mention of targeting conservatives, according to the committee’s summary.

Will anyone be fired?

Sen. Marco Rubio, R-Fla., on Monday demanded the resignation of the head of the IRS. That is Steven Miller, who is serving as acting commissioner until Obama nominates a replacement.

The last commissioner was Shulman, who was appointed by President George W. Bush in 2008, left the agency in November and has taken a position as a guest scholar at the Brookings Institution.

Newt Gingrich, the Republican former House speaker, told MSNBC on Monday that Obama should say “he’s going to fire everybody he can legally fire who’s been involved with this.”

How will the White House contain the political damage?

The IRS scandal presents a daunting political challenge for the White House, which is already being forced to defend its handling of the deadly attack on a U.S. diplomatic post in Benghazi, Libya, last September.

The furor over the IRS has come from both parties. Sen. Max Baucus of Montana, the Democratic chairman of the Senate Finance Committee, said Monday the agency had committed an “outrageous abuse of power” and pledged a grilling.

“The IRS will now be the ones put under additional scrutiny,” he said.

Sen. Tim Kaine of Virginia called it inexcusable, and Sen. Joe Manchin of West Virginia said the president “must immediately condemn this attack on our values and find those individuals in his administration who are responsible and fire them.”

How can this be prevented in the future?

Rubio, in his letter calling for the resignation of the IRS chief, called the behavior “seemingly unconstitutional and potentially criminal.”

But under existing law, the worst that can happen to an IRS agent who discriminates against taxpayers is getting fired, said Rep. Mike Turner, an Ohio Republican who sits on the House Oversight Committee.

Turner introduced a bill Monday to increase the toughest penalty to five years in prison and a $5,000 fine.

“This is about protecting the rights of all Americans and their ability to freely express their political thoughts,” he said.

Kelly O’Donnell of NBC News contributed to this report. Reuters and The Associated Press also contributed.

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