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IRS Reveals Accidental Exposure of Confidential Information

S.J. Steinhardt
Published Date:
Sep 6, 2022


The IRS revealed last week that, on Aug. 26, it erroneously posted on its website some confidential information about 120,000 individuals from Form 990-Ts filed by tax-exempt organizations, Accounting Today reported. The agency took down the information as soon as it discovered the mistake, which it blamed on a coding error.

In a statement on its website, the IRS said that it “took immediate steps to address this issue. The files have been removed from and will be replaced with updated files in the near future. In addition, the IRS also will be working with groups that routinely use the files to remove the erroneous files and replace them with the correct versions as they become available. The IRS will contact all impacted filers in the coming weeks.”

The Wall Street Journal reported that “the information disclosed from the Form 990-T was mainly about IRAs, including names, contact information and financial information about income within the IRAs, especially from investments in master limited partnerships, real estate or other assets that generate income as opposed to IRAs that invested in securities.”

The mistake “didn’t include Social Security numbers, full individual income information or other data that could affect a taxpayer’s credit, the Treasury Department determined, according to a letter that the administration [sent] to key members of Congress on Friday,” reported the Journal. The Journal “downloaded at least some of the data before its removal,” in line with its routine analysis of nonprofit tax filings.

The letter, sent by Anna Canfield Roth, the Treasury Department’s acting assistant secretary for management, to U.S. Rep. Bennie G. Thompson (D-Miss.), chair of the House Committee on Homeland Security, said that Treasury “has instructed the IRS to conduct a prompt review of its practices to ensure necessary protections are in place to prevent unauthorized data disclosures.”

As the Journal and other media have reported previously, the agency has long been plagued by inadequate resources, including technology systems, that have led to such errors in the past. The $80 billion budget recently signed into law aims to fix that, along with other issues, such as customer service.

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