Comey and McCabe were government employees for years, drawing predictable salaries that were reported to the IRS along with their tax withholding, and they would not have fallen into those categories during that time.
But then Trump fired them — Comey in 2017, and McCabe in 2018. Comey wrote two lucrative books and started giving paid speeches, and McCabe joined CNN as an on-air law enforcement analyst. Those arrangements, say tax policy experts and former high-ranking IRS officials, would have made both men far more likely to be chosen for a research inspection than they were as FBI employees, because the pool of high earners with such eclectic income streams is significantly smaller.
The rare audits were first reported by the New York Times. Lawmakers and the IRS commissioner have asked the agency’s top tax watchdog to investigate.
IRS chief faces questions over audits of Trump foes
Trump raged about Comey and McCabe constantly — advisers say they were near the top of his proverbial enemies list as president — and former officials told The Washington Post that Trump mused frequently that they should be investigated. But former IRS officials said the National Review Program would be hard to use as a deliberate weapon.
By firing the two men, though, Trump set the pair up to make much more money than they did at the FBI — launching them into a new tax bracket that the IRS examines much more frequently than it does even well-paid government employees.
The odds of both men being pulled into the research program’s audits by coincidence shortly after Trump fired them may seem slim, but former top tax policy officials told The Post they were certain that’s what happened — though they acknowledged that it looked suspicious.
“We like to see patterns, so that’s what we’re seeing,” said Mark Mazur, the Biden administration’s former assistant treasury secretary for tax policy, who previously led the IRS office in charge of the enigmatic research program.
The idea of using the IRS against political adversaries certainly crossed the former president’s mind.
Trump, who famously refused to release his own tax returns and claimed they were under audit, regularly complained that the IRS had been “a pain in the ass” to him over the years, one former official said, and he was “incredibly well versed” in previous accusations that past administrations had tampered with the IRS for political purposes.
One former senior official said Trump would rant that people should be investigated and audited, though neither of the two officials who spoke to The Post said they ever heard Trump give specific orders to that effect. The people spoke on the condition of anonymity to describe private conversations.
“They did it to us,” Trump would say in 2017, accusing the IRS of carrying out politically motivated audits of pro-Republican groups under President Barack Obama, a storyline conservative media had focused on frequently, though no evidence emerged to support such a claim. “He would say this person should be investigated, this person should be audited. I never heard him give a direct order,” one of the former officials said.
The IRS has worked for years to avoid giving even the appearance of political bias, though Trump administration officials said that would not have deterred the former president.
“He did not care one bit about what the rules were supposed to be,” one of the former officials said.
Through a spokesman, Trump said he knew nothing about the audits of McCabe and Comey, even as he criticized the two men.
The agency has faced previous suspicions that its examinations had been leveraged by political actors. Shortly after the 2012 presidential election, Mark Everson, who served as IRS commissioner during the George W. Bush administration, received a call from an investigative reporter about the coincidental enforcement audits of two aides to Mitt Romney, now a senator from Utah, who was the Republican challenger to Obama that year.
“I said to the reporter: ‘Please tell me you have something more than that the individuals said they were under audit shortly after the election,’” Everson said. The story never ran. Everson said it would be impossible for the IRS to quickly start a set of investigations after a presidential election, even if it wanted to. “Things happen, and in the political world they talk and conjure up conspiracies.”
The research program involves audits that are intrusive and complicated for taxpayers to deal with, but they’re very different from the enforcement audits most people think of when they worry about hearing from the IRS.
Enforcement audits are aimed at specific individuals suspected of violating the tax code. Their purpose is to collect revenue and deter further cheating. For the research audits, taxpayers are selected at random by an algorithm, and the procedures don’t mean that the IRS suspects fraud. The agency uses the results to regularly reprogram its enforcement software so it can more accurately go after questionable activity in the future.
“The fact that he’s in a [National Research Program] sample, a stratified random sample, how is this payback?” one former top IRS figure said of Comey.
The Taxpayer Advocate Service, the IRS’s internal consumer rights watchdog, has for years asked Congress to compensate taxpayers who are chosen to sit for a research audit, since many individuals spend hours procuring financial documentation for examiners and often retain counsel because they feel intimidated by the process.
“These folks, they weren’t selected because you had concerns,” said Nina Olson, who served as national taxpayer advocate from 2001 to 2019. “They’re really doing a public service.”
The research program, IRS insiders say, is seen as an annoying necessity within the agency. When the tax collector began the program in 2001, it sent highly trained enforcement agents to examine close to 15,000 taxpayers each year. The depth of the study frustrated the agents, who were not recovering revenue, and members of Congress, who received complaints from constituents about the invasive nature of the program, according to a former top IRS official who spoke on the condition of anonymity to talk about sensitive internal discussions.
Details of the research program are closely held because the agency fears that information leaks about topics the IRS is studying could embolden would-be fraudsters.
The tax agency in recent years has surveyed between 4,000 and 5,000 taxpayers, a significant drop that experts say is indicative of the IRS’s chronic lack of resources and its pivot away from enforcement activity, especially against high earners.
In 2019, the last year for which data is available, 53 percent of individual enforcement audits were completed against taxpayers with incomes less than $50,000, according to the Taxpayer Advocate Service, and 8 in 10 of those filers claimed anti-poverty tax credits.
Jeff Stein and Lisa Rein contributed to this report.