Can the IRS salvage its reputation amid political targeting scandal?

A crisis communication professional offers the federal tax agency four dire steps to take if it holds any hope of mending its already tainted image.

As the Internal Revenue Service political targeting scandal expands from an isolated policy in one office to a full-blown campaign in offices across the country, the tax service needs a massive shakeup to save whatever face it has left.

The IRS tried initially to get ahead of the news by saying only one office was targeting conservative groups, but that only made matters worse as U.S. Attorney General Eric Holder and various media outlets found that it was more widespread.

“I have ordered an investigation to be done,” Holder said Tuesday. “The FBI is coordinating with the Justice Department to see if any laws were broken in connection with those matters,” he added. “We are examining the facts to see if there were criminal violations.”

CNN is reporting that some IRS officials knew about the targeting as far back as March 2010.

President Obama has expressed outrage over the string of incidents, in which conservative groups seeking tax-exempt status under the 501(c)(4) code were targeted for extra scrutiny. He said the IRS staffers involved would be held accountable for any wrongdoing.

This is not your routine scandal that will pass in a week. Up next will be congressional hearings, resignations, and, probably, a shakeup in the IRS power structure.

There are some steps the tax agency can take to keep from fanning the fast-spreading flames:

1. The IRS needs to be breaking news on this scandal instead of getting blindsided by news outlets. Who said what and when needs be come from the IRS.

2. The IRS needs to cooperate thoroughly with any investigations by third-party agencies, examining just how widespread the campaign reached.

3. Those involved must be fired or suspended immediately, with a particular emphasis on the people who conceived of the inappropriate scrutiny, not just those who carried it out.

4. The IRS needs to hire an auditor on an ongoing basis to ensure politically motivated practices don’t happen again.

This story is juicy for it to go away any time soon, and the IRS already had a challenging reputation. Still, getting in front of the news can at least help a bit.

Gil Rudawsky heads the crisis communication and issues management practice at GroundFloor Media in Denver. He is a former reporter and editor. Read his blog or contact him at

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