ACORN, meanwhile, said it had already suspended its tax program.
ACORN, which is short for the Association of Community Organizations for Reform Now, has long been a target of conservative activists. A hidden-camera video surfaced earlier this month showing ACORN employees in Brooklyn, N.Y., advising a couple posing as a prostitute and pimp to lie to get housing aid. The video, produced by a conservative activist, shows employees in other cities counseling the pair on tax, banking and immigration issues.
"It is absolutely critical that taxpayers have trust in our Volunteer Income Tax Assistance program partners," the IRS said in a statement. "In light of recent events, the IRS has decided to terminate its relationship with ACORN."
ACORN chief executive Bertha Lewis said Wednesday the group had already stopped accepting new clients into its service programs and was specifically suspending its tax program.
The House and Senate voted earlier this month to sever federal funding to ACORN. The Census Bureau severed its ties with the group for the 2010 national head-count, and New York Gov. David Paterson has ordered state agencies to examine contracts with ACORN and place holds on them in the meantime.
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