Lerner, who headed the division in the tax-collecting agency that handles applications for tax-exempt status, had been placed on paid administrative leave in May. Calls for her dismissal came almost immediately following allegations she had participated in unfairly targeting conservative groups.
The IRS confirmed on Monday that she has resigned, though it's unclear how that decision might affect the ongoing congressional investigations into the scandal.
"Since May, the IRS has taken decisive actions to correct failures in Exempt Organizations management,
The announcement has not quieted calls for a thorough probe into the agency's actions. It's also not clear what kind of government-paid retirement benefits Lerner might be receiving.
"Just because Lois Lerner is retiring from the IRS does not mean the investigation is over. Far from it. In fact, there are many serious unanswered questions that must be addressed so we can get to the truth," Sen. Orrin Hatch, R-Utah, top Republican on the Senate Finance Committee, said in a written statement.
Rep. Darrell Issa, R-Calif., chairman of the House Oversight and Government Reform Committee, said: "Lois Lerner's exit from the IRS does not alter the Oversight Committee's interest in understanding why applicants for tax exempt status were targeted and inappropriately treated because of their political beliefs."
"We still don't know why Lois Lerner, as a senior IRS official, had such a personal interest in directing scrutiny and why she denied improper conduct to Congress. Her departure does not answer these questions or diminish the Committee's interest in hearing her testimony," he said.
Lerner first disclosed the IRS targeting at a May 10 tax law conference.
Lerner then infamously refused to testify at a hearing before Issa's committee, citing her constitutional right not to incriminate herself. Three congressional committees and the Department of Justice, though, launched investigations into the IRS and its actions.
Eventually, the agency acknowledged that while she was in charge, IRS agents improperly targeted Tea Party groups for extra scrutiny when they applied for tax-exempt status from 2010-2012.
Earlier this month, newly released emails seemed to support accusations against the embattled IRS official and her role in scrutinizing applications.
The agency had initially tried to spin the story, claiming the unfair targeting was the work of rogue Ohio-based employees.
One email dated February 2011 from Lerner said, "Tea Party Matter very dangerous" - before going on to warn that the "matter" could be used to go to court to test campaign spending limits.
The email was released by the House Ways and Means Committee and parts were redacted.