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IRS Mistakenly Published Confidential Data for 120,000 Taxpayers

By Laura Davison

The Internal Revenue Service mistakenly published confidential data for 120,000 taxpayers on its website before realizing the error and taking down the data, the Treasury Department said.

Internal Revenue Service 1040 Individual income tax forms for 2021 arranged in Louisville, Kentucky, U.S., on Tuesday, April 12, 2022. Refund sizes in some cases have been up by nearly 25% compared with last year due to pandemic relief programs and rising wages.

The IRS accidentally posted data from a tax form used by both individuals and tax-exempt organizations, the Treasury said in a letter to lawmakers on Friday. While information about nonprofit groups is routinely made public, that for individuals is supposed to be kept private. The Treasury said the IRS would contact all individuals affected in the coming weeks.

The disclosure didn’t include Social Security numbers, income figures or information that could harm an individual’s credit, the department said. Some published information included names and contact information. 

Republicans may seize on the error as further cause for concern about the IRS, which many GOP lawmakers characterize as an agency that sets a priority of revenue-gathering over respect for individuals.

The 990-T form involved in the incident is used by both tax-exempt groups and individuals with some retirement accounts invested in certain assets, including master limited partnerships and real-estate investment trusts.

The Treasury said the error was discovered on Aug. 26, but didn’t specify how long the confidential information had been available for the public to download.

“The IRS is continuing to review this situation,” Anna Canfield Roth, the Treasury’s acting assistant secretary for management, said in the letter. “The Treasury Department has instructed the IRS to conduct a prompt review of its practices to ensure necessary protections are in place to prevent unauthorized data disclosures.”

The episode is likely to renew criticism from Republicans who are still seeking answers from the IRS about the disclosure of some wealthy taxpayers’ income information published last year by ProPublica. GOP lawmakers have pressed the agency for more details about its investigation into the data leak.

The mistaken disclosure could also give Republicans to push for lower IRS funding if they were to win majorities in Congress in the midterm elections. They have criticized the provision in the Democrats’ Inflation Reduction Act, passed last month, that grants the agency $80 billion in additional funding over a decade.

More stories like this are available on bloomberg.com

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