When the media gets hold of a controversial issue, it is always a good idea to hear what insiders on the issue think is the real story because it is often diametrically different than what we are hearing.
In this case of the IRS targeting political enemies of the ruling administration, what do tax lawyers for tax-exempt orgs think of the scandal?
In short, the IRS does this kind of stuff all the time (with or without the Obama administration)! Just bad timing for getting caught during a particularly strong scandal season for the President.
My own two cents: in my experience, the IRS has no problems with overstepping their jurisdiction. Orgs I have advised were held hostage over their exemption status over non-federal tax issues or issues irrelevant to tax-exempt status. One organization was forced to sign an agreement that they would never again participate in raffles schemes (clearly a state law issue) if they wanted their 501(c)(3) letter. Another organization was held hostage over their use of parsonage for their clergy-teachers (probably incorrectly and certainly not relevant to the 501(c)(3) application). Basically, they used their strong bargaining position to push around the nonprofit for any issue they didn’t feel comfortable with – regardless of whether it had anything to do with the application being submitted.
The message I took from my limited experience was that when you go to the IRS for tax-exempt recognition, go in with as clean an application as possible, plain vanilla, nothing out of ordinary. Nothing to give them reason to think twice.