IRS docks ACORN

ACORN, the embattled anti-poverty advocacy group, took another hit today.

Joining the Census Bureau, the Internal Revenue Service announced it is severing its ties with ACORN, which had been included in a volunteer tax assistance program that offered free advice to about 3 million low- and moderate-income taxpayers.

The IRS said ACORN, embroiled in a scandal after employees were captured on hidden-camera video giving advice to a couple posing as a prostitute and her pimp, provided help on about 25,000 returns.

This afternoon, ACORN released a letter, dated Monday, from CEO Bertha Lewis to the IRS saying that it was suspending its tax assistance activities.

"ACORN has been pleased these past few years to work with the Internal Revenue Service to help low- and moderate-income families save hundreds of dollars each tax season by working with ACORN to receive free tax filing assistance. As you know, through this partnership, ACORN has become one of the largest participants in the SPEC program. Since 2004, we have helped nearly 150,000 families with tax preparation, generating $86 million in earned income tax credit (EITC) refunds and $190 million in overall refunds for low- and moderate-income taxpayers," Lewis wrote.

"As you know, ACORN has been the target of a sustained attack from conservative forces for a number of years. Recent videos generated by conservative activists, including one from our tax clinic in Baltimore, MD, have raised questions about our service programs. That is why I have suspended new clients into our service programs and am naming an independent review of these programs. Today I want to notify you that for the 2009 tax season, I am suspending all ACORN tax preparation services. It is clear that our the independent review will not be complete in time to allow these tax clinics to adequately prepare for the upcoming tax season. Upon completion of this review, we will revisit our participation in your programs."

The Census Bureau said earlier this month that it would no longer work with ACORN on the 2010 population count, and the House and Senate both voted last week to cut off funding.

While Republicans have been calling for the federal government to end any cooperation with ACORN, Representative Barney Frank, a Massachusetts Democrat, also urged the Obama administration to withhold any additional funding ""at least until there is very firm evidence that the abuses of which ACORN members have been guilty have not only ceased, but that procedures are in place to prevent them from happening again."

"I am very disappointed in the actions that were taken by members of ACORN," Frank, chairman of the House Financial Services Committee, said in a statement today, "and I do not believe that ACORN's response has been adequate for an organization that has received public funding."

Late this afternoon, ACORN announced that it has filed a lawsuit in Baltimore against the couple -- James O'Keefe and Hannah Giles, along with Breitbart.com that distributed the video -- seeking a preliminary and permanent injunction against further distribution along with compensatory and punitive damages.

The lawsuit claims that because the video and audio footage was taken without the knowledge of the two ACORN workers, that violated Maryland law that requires consent for all electronic surveillance.

ACORN's general counsel, Arthur Schwartz, said in a statement that the tapings were "clear violations of Maryland law that were intended to inflict maximum damage to the reputation of ACORN, the nation's largest grassroots organizer of low-income and minority Americans. Unfortunately they succeeded".

Bertha Lewis, ACORN's CEO, added that "although we do not condone what our former employees did, no matter how entrapped they were, we are also committed to our 500,000 members that we will hold the defendants civilly and criminally responsible for their violations of Maryland laws and for the damages inflicted upon ACORN's reputation."