Audit: IRS credit cards used to buy expensive meals, pornography

George’s report is just the latest in a string of issues for the IRS, which has been dealing with the fallout from its targeting of conservative groups for a month and a half.

Citing new information from the IRS, top Democrats said this week that liberal groups seeking tax-exempt status were also singled out, and have questioned the tax administration inspector general’s original report on the matter.

The IRS, like other agencies, is allowed to make purchases of up to $3,000 a transaction directly from vendors.

But the inspector general’s report says that the IRS has yet to develop a plan to cancel credit cards after an employee leaves the agency, and does not have a process for smoking out personal purchases on the card.

Other credit card purchases listed in the Treasury audit include a jigsaw puzzle and the "world's largest crossword puzzle" for $89; "novelty decorations" like kazoos, toy boats and Thomas the Tank Engine wristbands for $418; and unused Nerf footballs for $119.

In its response to the audit, the IRS said it would implement all 11 recommendations. “We are committed to ensuring proper oversight of our purchase card program and appreciate your review of our efforts,” the agency’s David Grant said in a response letter.

Danny Werfel, who took over as head of the IRS last month, added in a statement that the agency has made progress in oversight of its credit cards in recent years, and said that 99 percent of purchases were legitimate.

But Werfel also said that he was ordering business units in the agency to ensure that the spending on credit cards is appropriate. 

"Clearly, any inappropriate card use impacts our bottom line and is cause for concern. Wasteful spending cannot be tolerated, and any employees found to be abusing the system will be held accountable," Werfel said. 

"In fact, we are following up on several inappropriate incidents mentioned in the report, ranging from internal actions to criminal charges."