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Acting Director Of Tax Agency Resigns UPDATE

WASHINGTON President Barack Obama announced on Wednesday that Steven Miller, the acting director of the Internal Revenue Service, had resigned amid criticism over the tax agency's handling of conservative groups seeking tax exempt status.

Speaking from the White House's East Room, the president said that he had instructed Treasury Secretary Jack Lew to hold the IRS accountable for its missteps, revealed in a Treasury Department inspector general's report released on Tuesday. Among the steps Lew took was to request and accept "the resignation of the acting commissioner of the IRS."

The president also said that he had instructed Lew to implement the recommendations of the inspector general's report which looked into why groups with words like "tea party" in their name had been forced to endure more scrutiny when applying for 501(c)(4) status. Obama added that he would "work with Congress as it performs its oversight role" in investigating the IRS.

Whether the resignations will end with Miller is unclear. Earlier in the day, Miller himself had acknowledged that two "rogue" employees in the agency's Cincinnati office had been responsible for subjecting tea party groups to extra scrutiny when they applied f cheap fitflop or 501(c)(4) status. CNN quoted a second source saying that responsibility was not limited to just two individuals.

Later in the day, NBC News reported that the IRS had "disciplined" those employees for applying inappropriate criteria, while the National Review reported that IRS employees had received an email alerting them to not "wipe" their laptops or desktop computers, an indication that investigation into what went wrong at the agency is still ongoing.

The statement from Obama caps, for the time being, a story that has dominated Washington news this week. Revelations of IRS wrongdoing surfaced on Friday and immediately prompted heavy criticism from both sides of the political divide. The Treasury Department inspector general's report concluded that the malfeasance had come from within the IRS, and not at the prompting of an outside agency. Still, calls came for the White House to take a tough stand.

On Wednesday, White House press secretary Jay Carney called on the IRS to implement reforms outlined in that inspector general report. The internal message to IRS employees from Acting IRS Commissioner Steven T. Miller:

It is with regret that I will be departing from the IRS as my acting assignment ends in early June. This has been an incredibly difficult time for the IRS given the events of the past few days, and there is a strong and immediate need to restore public trust in the nation's tax agency. I believe the Service will benefit from having a new Acting Commissioner in place during this challenging period. As I wrap up my time at the I fitflops RS, I will be focused on an orderly transition.

While I recognize that much work needs to be done to restore faith in the IRS, I don't want anyone to lose sight of the fact that the IRS is comprised of incredibly dedicated and hard working public servants. During my 25 year IRS career, I am profoundly proud to have worked alongside you and to be part of an institution that has worked hard to support the nation. I have strong confidence in the IRS leadership team to continue the important work of our agency.

I want to thank everyone for all of their support and friendship during my career in government service. And I especially want to thank each and every one of you for your continued commitment to the nation's taxpayers.

More than two years after the problem began, and a year after the IRS told us there was no problem, the President is beginning to take action. If the President is as concerned about this issue as he claims, he'll work openly and transparently with Congress to get to the bottom of the scandal no stonewalling, no half answers, no withholding of witnesses. These allegations are serious that there was an effort to bring the power of the federal government to bear on those the administration disagreed with, in the middle of a heated national election. We are determined to get answers, and to ensure that this type of intimidation never happens again at the IRS or any other agency.

President Barack Obama"This is pretty straightforward," Obama said at a press conference. "If, in fact, IRS personnel engaged in the kind of practices that have been reported on and were intentionally targeting conservative groups, then that is outrageous, and there is no place for it, and they have to be held fully accountable, because the IRS as an independent agency requires absolute integrity and people have to have confidence that they are applying the laws in a non partisan way. You should feel that way regardless of party."Sen. Marco Rubio (R Fla.)Rubio penned a letter to Treasury Secretary Jack Lew demanding the IRS commissioner's resignation. The letter begins:

"Recent revelations about the Internal Revenue Service's selective and deliberate targeting of conservative organizations are outrageous and seriously concerning. This years long abuse of government power is an assault on the free speech rights of all Americans. This direct assault on our Constitution further justifies the American people's distrust in government and its ability to properly implement our laws."

House Speaker John Boehner (R Ohio)"The admission by the Obama administration that the Internal Revenue Service targeted political opponents echoes some of the most shameful abuses of government power in 20th century American history. Today, we are left with serious questions: who is ultimately r Fitflop Fiorella esponsible for this travesty? What actions will the Obama administration take to hold them accountable? And have other federal agencies used government powers to attack Americans for partisan reasons? House Republicans have made oversight of federal agencies a top priority on behalf of the American people, and I applaud the work that members such as Charles Boustany, Darrell Issa and Jim Jordan have done to bring this issue to light. I also strongly support Sen. McConnell's call for a transparent, government wide review to ensure similar practices are not happening elsewhere in the federal bureaucracy," Boehner said in a statement.

(AP Photo/Cliff Owen)

Rep. Darrell Issa (R Calif.)

Rep. Michele Bachmann (R Minn.)

Sen. Harry Reid (D Nev.)

Sen. Chuck Grassley (R Iowa)

Rep. Vern Buchanan (R Fla.)Buchanan also wrote a letter calling for the IRS commissioner's resignation. His letter reads:

"On March 22, 2012, as a member of the House Ways and Means Committee which oversees the IRS, we heard then Commissioner Douglas Shulman clearly state that the IRS did not engage in the practices of which it is now accused saying "there is absolutely no targeting." Yet, less than a year earlier, Commissioner Shulman's own deputy, Lois Lerner, was made aware that such malpractice had indeed occurred. It became evident that groups with "tea party" or "patriot" in their names were extremely vulnerable to auditing harassment. Constitution were unfairly singled out for scrutiny. The nation's trust in government was betrayed by this unconscionable behavior. On behalf of my constituents, your immediate response is not only warranted but essential to clearing up a matter that would have our founding fathers rolling in their graves."