William Henck: My IRS ordeal

The IRS was at the center of the deepest scandals of the Obama administration. Bill Henck gave us a look from his perspective inside the IRS Office of the Chief Counsel, where he has worked as an attorney for 30 years. In 2014 we posted Bill’s personal account of a retaliatory audit conducted by the IRS against him in “Inside the IRS.”

We followed up with subsequent posts by Bill including, most recently, “Inside the IRS, part 8,” in which Bill argued that “[t]he rule of law at the IRS died” had died following a lengthy illness and that “[t]he immediate cause of death was IRS attorney executives giving themselves large bonuses and then illegally keeping those bonuses secret.” Readers can access all of Bill’s pieces for us by clicking on “Inside the IRS.”

In June 2016 Washington Post reporter Steven Mufson chronicled Henck’s ordeal inside the IRS in “Is the IRS getting back at an in-house critic?” Answer, I’m pretty sure: Yes. Mufson now returns to the story of Bill’s ordeal in “IRS whistle blower who questioned paper industry tax break fights to keep his job.” Bill provides this update for for Power Line readers in his own words:

The Washington Post article appeared yesterday afternoon. I have a tremendous amount of respect for Steve Mufson and I appreciate his coverage of this story. I offered to waive my privacy rights if IRS executives would go on the record with Steve, but I guess they didn’t want any part of him. I would like to add several thoughts that your readers may be interested in:

Every workday I walk past a mural in downtown Richmond that states, “Our lives begin to end the day we become silent about things that matter.” This matters. That’s why I’m speaking out. IRS executives are either accountable or they are not. If people in the administration and Congress want to hold IRS executives accountable, this case is their best (and probably last) opportunity to do so.

I publicly spoke out about the black liquor situation in 2013 after my internal ethical concerns were ignored. I will only speak further on the subject before appropriate authorities. Suffice it to say that if this matter is investigated, past and current IRS executives have a lot to worry about.

Also in 2013, an IRS chief counsel executive filed a TIGTA complaint against me. He claimed to have had conversations with me that never occurred and he asserted that people could read a 2013 Washington Post article and deduce from the mention of my name in that article the identity of a particular taxpayer. His assertion was stupid beyond belief on not one, but two different levels.

I cannot detail the Service’s attempted rationale of its psychic hotline argument without possibly violating section 6103, but I have thought of an example to explain it. Assume that the Post mentioned that I’m a football fan. The Service’s argument is equivalent to arguing that the Post mentioning that I’m a football fan means that people could read that article and deduce that I watched the Cowboys-Rams game last week, and that furthermore I did not watch any other game. So if someone called the psychic hotline and somehow figured out that yes, in fact, I did watch the Cowboys-Rams game last week, so what? I could have also watched the Broncos game. Or the Redskins game. Or binge watched the NFL Network and watched every preseason game last week.

After being notified in 2015 that I was the subject of a TIGTA investigation for violating section 6103, my family and I were kept twisting in the wind for a year. Last July, two days after a Post article covered my situation, the IRS office of chief counsel issued to me a notice of proposed termination. The primary position in that notice was that I violated section 6103 by identifying a taxpayer based upon their psychic hotline argument.

My initial inclination was to fight, but friends, family, attorneys, and a hospital stay with a possible heart attack led me to decide to take a settlement where I could stay until November of this year, thus qualifying for my pension. I was advised that absent the settlement, I would be fired within a month, lose my paycheck and be effectively disbarred for at least a year while the Merit System Protection Board process played out, have to pay approximately $100,000 to litigate the matter, possibly lose my pension if I lost, and face a ruthless opponent that had no downside risk and would lie as part of a “well orchestrated plan.”

To quote a friend of mine who advised me to take the settlement, “they’re willing to lie and they have more lawyers than you do.” That is a very perceptive comment, but what does it say about the IRS? Most importantly in terms of accepting the proposed settlement, my family and I were on the brink. We could not take much more. One of my kids told me that he wanted his father back. How do you respond to that as a parent?

After agreeing to the settlement, I asked a number of attorneys if I had an ethical obligation to report to TIGTA my view that the chief counsel executive had not been truthful with them. I was strongly advised to keep my mouth shut. One attorney told me to return to “planet Earth.” Another attorney told me that chief counsel executives would attack me like “rabid animals” if I reported their colleague.

I’m sure those attorneys gave that advice because they were looking out for my best interests, but what does that say about integrity in our government when executives are allowed to lie with impunity? I finally decided that I had an obligation as a federal government employee to report the matter to TIGTA.

On August 9, I met for four hours with two TIGTA agents. I presented to them written material, including contemporaneous written evidence that supports my contention that the chief counsel executive had lied to them, and the names of 17 witnesses with respect to ten separate items of IRS corruption and misconduct. Four of those items relate to improper influence on the part of lobbyists and one item relates to the 501(c)(4) controversy.

In reality, this is a case of petty retaliation. IRS executives believe that I disrespected them, perhaps with good reason. This is obvious from the notice of proposed termination itself. In the notice, they take the position that I cannot be “rehabilitated” because I had stated that this case is about corruption and IRS management covering up misconduct. You cannot get much more blatant than that regarding motivation. It is also obvious that they don’t take section 6103 seriously except as a sword and a shield to avoid accountability.

I presented to TIGTA a copy of a paragraph in a chief counsel website section called “Kudos to Recent Successes” where the office of chief counsel managed to violate section 6103 nine times in a single paragraph. They even listed specific dollar amounts reported on a taxpayer return. I’m being terminated in November for discussing an IRS policy position and the fact that it was being kept secret, but IRS management can violate section 6103 nine times in one paragraph on their own freaking website and get away with it.

Also with respect to their lack of seriousness in this matter, I’ve served as an acting manager on several occasions in recent months. Basically they are saying, “you are unworthy to be a federal employee so you have to leave in November, but in the meantime do us a solid and fill in as a manager.” You can’t make this stuff up.

Unless someone intervenes, I’m out in November. I would like to leave on my own terms, but I’ll survive either way. I’m proud of my record and I’m proud of the rank and file people I have served with. I have received letters from taxpayers thanking me for the manner in which I treated them. I have received letters and emails of support from colleagues and clients. One exam manager called me “one of the good guys.” Those are the things I take pride in.

I spoke out because I witnessed corruption and it sickened me. I did my duty and if management gets me, they get me. The only thing that I regret is that my family has been through so much in all of this. Regardless of my personal feelings, if I’m forced out in November, that’s it for any chance of accountability in the IRS.

Before the TIGTA interview, I called the 17 employees I would be listing as witnesses. Several of them were too scared to talk to me. One of the others told me “please don’t put my job in jeopardy.” There is a real fear of retaliation within the IRS. I told the TIGTA agents that if I leave in November, they would be getting a whole bunch of “I don’t recall” when they talked to the witnesses.

I don’t know what else I can do. I really don’t.

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