An Agency Running From Its Own History : Unbridled Power: Inside the Secret Culture of the IRS, By Shelley L. Davis, (HarperBusiness, $25)


Among the federal institutions that loom particularly large in the lives of Americans, the Internal Revenue Service certainly is the most remote from public view.

Unlike the nation’s space agency or the FBI or the armed services, the IRS has no museums, no public tours and absolutely nobody it could call a hero. It hardly even has a telephone that anybody answers.

As it goes about collecting $1.4 trillion of tribute from Americans each year, the IRS has achieved a remarkable anonymity--a void in the nation’s history.


What the IRS does have, according to author Shelley L. Davis’ new book “Unbridled Power: Inside the Secret Culture of the IRS” (HarperBusiness, $25), is a sordid past of taxpayer abuse, internal corruption, political dirty tricks and a hierarchy of lazy, scheming bureaucrats.

The IRS has long been pummeled--often for gratuitous political ends--for its dark misdeeds. What makes “Unbridled Power” new is its examination of the IRS’ successful efforts throughout its history at staying hidden from the public.

Davis, who previously worked as a Defense Department historian, spent seven years as the IRS’ first--and perhaps last--historian. Her book offers a look at the bizarre odyssey of a federal agency that remains an enigma even for those inside the Beltway.

In her job orientation at the IRS, Davis is warned that working for the tax agency will be a “social embarrassment” and is advised to tell acquaintances she works for the Treasury Department.

No sooner does Davis starts her job than she discovers that she is the subject of deep suspicion by senior officials who prefer that the IRS forget its history. Her job is bounced around to different departments, and at one point her slot is traded between managers for an office copier, she recalls.

As she begins her efforts to identify IRS documents that should be preserved for their historical significance, she runs into stone walls that have been erected around any records that might be remotely embarrassing to the agency, she writes.


One day Davis discovers that the agency’s Watergate files, detailing its surveillance of left-wing political groups in the 1970s, are locked up in an obscure wall safe behind a set of curtains in a conference room.


Another treasure trove of documents is found in a basement with leaky pipes. The tax returns of former presidents are squirreled away in another safe and nearly ordered destroyed in the days after Richard Nixon died.

While IRS offices are routinely shredding historical records, the National Archives has hundreds of feet of empty shelves where IRS historical documents should be kept, Davis learns.

By this time, Davis has dubbed the IRS headquarters on Constitution Avenue the “temple of doom.” In the end, IRS officials put Davis herself under investigation on an unfounded suspicion that she had assisted a university professor with a Freedom of Information request. The investigation came to nothing, but by then Davis had concluded that she had no choice but to resign in protest.

“Unbridled Power” provides a well-told--though obviously one-sided--story about life inside a gray bureaucracy. It will appeal to history buffs, tax practitioners and any taxpayer thrilled to relive the IRS’ worst moments.


Davis goes through a lengthy, albeit instructive, recounting of the IRS scandals that have percolated to the surface over the last 40 years, ranging from the Watergate probes to the modern-day problems the IRS is having with its computer modernization program.


Among the most sensational disclosures came from the 1989 hearings held by Rep. Doug Barnard (D-Ga.), which found that IRS officials had billed taxpayers for their cross-country romantic liaisons, covered up corruption by other IRS employees and, in a couple cases, instigated criminal investigations for their potential personal gain.

The Barnard hearings, however, had little real impact on the agency, and since those disclosures the agency has gone back to its practice of keeping a low profile.

The legal bulwark that the agency has used to keep the public out of its dirty laundry, oddly enough, was an outgrowth of the Watergate era. Known as Section 6103 of the Tax Code, the measure strictly forbids the IRS from disclosing confidential taxpayer information to anybody, except for specific groups cited in the act. They include two members of Congress, state revenue agencies and the Justice Department, among a few others.

Davis argues that the IRS has badly abused 6103 by invoking it improperly to keep disclosures of corruption, waste and incompetence from public view. This contention, among the many damaging allegations in the book, evokes the strongest protests from the IRS.

“I would take serious exception to the idea that the IRS misuses confidentiality laws,” says agency spokesman Frank Keith, who notes that much of “Unbridled Power” has been told previously in published accounts. “It is absolutely untrue.”

“The idea that the IRS has engaged in wholesale destruction of records is a gross exaggeration. The National Archives recently did a review of our practices and found no evidence to support allegations of that type.”



Keith said that the IRS has obtained a Justice Department legal ruling backing up its contention that the National Archives is not entitled to any documents involving confidential taxpayer information--including the tax returns of former presidents.

Yet the IRS has never explained why it eliminated the office of its historian after Davis left in 1996. Its unwillingness to face its own history will doom the agency to repeat it, Davis asserts.

“My real motivation in writing this book,” Davis writes, “is to prove that the IRS--even though it might be able to destroy all its documents and even itself--in all its unbridled power, cannot destroy its own history.”

Ralph Vartabedian covers the IRS for The Times’ Washington bureau. He can be reached via e-mail at