When Lois Lerner, the former IRS chief of the Exempt Organization unit and figure at the center of the targeting scandal, transferred 1.25 million IRS documents to the Justice Department in October of 2010, she almost certainly broke the law, according to new documents unearthed by the group Cause of Action in a FOIA suit.

The documents contained tax returns and other private tax information from non-profit groups.  The transfer was done in advance of a meeting between IRS and Justice Department officials to discuss prosecuting non-profits for illegal political activity.

But federal law prohibits the transfer of tax returns to any agency without following set procedures.  Lerner's transfer was thus highly illegal.

NRO:

Federal law prohibits the IRS from sharing tax returns filed with the agency, with very limited exceptions. “The IRS has a special obligation to keep information confidential, that’s how our tax system works,” says Eileen O’Connor, who served as assistant attorney general for the tax division of the DOJ in the George W. Bush administration.

Documents suggest that Lerner’s massive document transfer to the DOJ didn’t meet any of those exceptions, including one that allows the agency to disclose returns for use in criminal investigations — if they’ve been requested in relation to “an actual investigation about a person to whom the investigation is related,” says O’Connor. Both Lerner and the DOJ were interested in figuring out how to prosecute non-profit groups they believed were engaging in improper political activity, and Lerner sent the documents over to the department days before an October 8 meeting with several of her IRS colleagues, an FBI agent, and attorneys from the DOJ’s public-integrity section. There they discussed their mounting “concern that certain 501(c) organizations are actually political committees ‘posing’ as if they are not subject to FEC law, and therefore may be subject to criminal liability,” according to a DOJ summary of the meeting.

A lawful transfer of the documents would have required a formal request from the DOJ to the IRS, but DOJ trial attorney Stephanie Sasarak told Cause of Action in a March 9, 2016, letter that the department did not make any requests to the IRS for the documents it received. Alternatively, the secretary of the Treasury could have turned the documents over to the DOJ. In either case, section 6103 requires the Treasury secretary to disclose the transfer to the bipartisan Joint Committee on Taxation, which releases publicly a list of disclosures each year. But the Joint Committee on Taxation’s 2010 disclosure report does not show a transfer to the Department of Justice that matches the one Lerner sent in October of that year.

Incredible.  Thousands of non-profit groups had their tax returns transferred illegally, while the IRS and Justice deliberately kept Congress in the dark. 

The FBI closed its investigation of the Tea Party targeting scandal in October of 2015 without indicting anyone.

It doesn't get any clearer than this.  Procedures set down by law on how taxpayer info can be disclosed were discarded, and a cover-up of the transfer to DoJ was initiated.  What's worrisome is, if they are covering up disclosure violations like this, how many more taxpayers are in the cross hairs of the IRS and DoJ without knowing it, and is there any way to find out?