IRS Under Fire

Did the IRS single out conservative groups because of their politics?
3:21 | 05/13/13

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Transcript for IRS Under Fire
We begin tonight with a question of fairness in america, and a bedrock belief. You don't have to like the irs, but you do expect them to be completely impartial about politics. Here's the stated mission of the agency. Enforce the law with integrity and fairness to all. But tonight the irs is under fire. Did they target the tea party and other conservative groups? Abc's chief white house correspondent, jonathan karl, goes in search of the facts. Reporter: It's a movement based on the belief that everyday americans have reason to fear the power of their own government. And that's what jennifer stefano, a mom and tea party -- conservative activist philadelphia, said she confronted when she was grilled by the irs after trying to start her own teerpt group. They would ask these details, and I've got a baby on one arm, breast-feeding, you know, trying to feed another baby, and trying to figure out how many e-mails did I send out last week? You'll see the level of detail they wanted. How many e-mails did you send in what were they? How many rallies did you go to? How many events? Reporter: Extra scrutiny that it turns out many other conservative groups have faced over the past three years when trying to register as tax-exempt organizations. Ultimately stefano gave up. It had a chilng effect on all of us. Reporter: Toby marie walker and carol waddell founded a group called the waco tea party in texas, and also faced a lengthy interrogation from the irs. When I opened it up and saw the five pages of question after question after question, i didn't know whether to laugh or cry or throw something. Reporter: Now the irs has apologized for inappropriately targeting tea party groups for -- but they've also said the targeting was done by employees in their cincinnati field office and not for political reasons. But a report by the irs's own watchdog shows senior irs officials in washington knew what was going on. The report also suggests a clear political dimension -- targeting conservative groups for extra scrutiny, even those groups that -- even those, that, quote, criticize how the country is being run. President obama four years ago joked about sicking the irs on people when he gave the commencement address at arizona state university, and did not get an honorary degree. President crowe and the board of regents will soon learn all about being audited by the irs. Reporter: But today he made it clear that, if true, this is no laughing matter. That is outrageous. It is contrary to our traditions, and people have to be held accountable, and it's got to be fixed. Reporter: So how high did it go? Tonight we learned that the acting commissioner of the irs knew about this all in may of 2012, one year ago. At the time, he was the deputy commissioner. So that was a year ago. Any evidence it went into the white house? No evidence of that. In fact the white house tells us the president didn't learn about any of this until friday as the news began to break. Do these gruchz have any recourse? I just spoke to a top lawyer representing many of these groups, who says they're looking into suing the irs for damages, of all the work they had to go through with these applications and the questioning. Certainly a brewing and building controversy. Thank you, jonathan karl.

This transcript has been automatically generated and may not be 100% accurate.

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