Kafkaesque IRS Hounds a Black Liquor Critic

My fellow Americans, we interrupt our regular programming to bring you this breaking news about how your tax dollars are being spent:

Black liquor is a pulp byproduct.

After years of inaction and improper actions that enabled U.S. paper companies to milk billions of dollars in black liquor tax credits, the Internal Revenue Service has finally found a culprit.

It's not the elected officials who might have pressured the IRS to twist the laws and look the other way, or the IRS officials who did their bidding, or the paper companies who were allowed to siphon money that was supposed to prod development of biofuels. No, the IRS is going after the whistleblower in its midst who had the audacity to help expose the scandal.

In a move that could have a chilling effect on other whistleblowers, the IRS has placed lawyer William Henck "in a Kafkaesque limbo," writes Steven Mufson of The Washington Post. The agency completed an investigation of his alleged "crimes," which included speaking to Mufson, six months ago but won't tell him what it found, leaving him twisting in the wind.

Mufson broke the story of the original tax-credit giveaways for burning black liquor, a byproduct of manufacturing kraft pulp, in 2009 and has continued to report on related round-heeled IRS maneuvers that have come to be known as Son of Black Liquor, Grandson of Black Liquor, and The Creature From the Black Liquor Lagoon. I'll bet the IRS is preparing to send a team of its friendly tax auditors to his home to "thank" him for his efforts.

"There was in my opinion clearly a cover-up of the decision to allow well connected taxpayers to avoid reporting the black liquor tax credits as taxable income, Henck has previously written. He and other IRS employees examining the credits were told by high-level agency officials “to take a position that was contrary to the law and to published IRS guidance,” he wrote.

I have never met, spoken with, or corresponded with William Henck. But he's clearly an heroic government employee who deserves to be rewarded, not punished, for trying to get the IRS to protect taxpayer funds instead of giving them away.

Other articles about the IRS's tawdry handling of black liquor credits include:

• Son of Black Liquor: A $50 Billion Loophole for the U.S. Pulp and Paper Industry
• IRS Brings Son of Black Liquor Back From the Dead; Ruling May Be Worth Billions to U.S. Pulp Makers
• IRS Inaction Leads to Another Black-Liquor Windfall for U.S. Paper Companies

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