Lewis Opening Statement at Oversight Subcommittee Hearing on the Internal Revenue Service’s Taxpayer Online Authentication Efforts
(As prepared for delivery)
Madam Chair, thank you for holding this hearing. I would also like to thank our witnesses for being here this morning.
Today’s hearing will examine how the Internal Revenue Service confirms taxpayers identities when they use online services. This process is important for reducing identity theft and refund fraud.
The growing number of security breaches across the public and private sectors often make it difficult for the agency to verify the real taxpayer. In many cases, criminals combine sensitive taxpayer information that they stole from several sources. The thieves use this information to access a taxpayer’s online account or file a fraudulent tax return.
The impact of these tactics are severe and costly. For example, criminals stole more than $1.5 billion by filing fraudulent tax refunds in 2016. Just last year, the IRS shut down a popular online service that students use to apply for federal financial aid after a breach allowed crooks to access the adjusted gross income of about 100,000 taxpayers.
Madam Chair, we all agree that the IRS is making progress. I applaud the agency for reducing tax-related identity theft. I am also pleased that agency officials partnered with industry and States to protect taxpayers and reduce identity theft.
Although I am encouraged that the agency improved its efforts to protect taxpayer data, the IRS must keep up the fight. As online services become more popular, there will be additional pressure to detect and stop security threats before the criminals reap the rewards.
In closing, I must note the relationship between resources and the security and protection of taxpayers. The IRS must have adequate funding in order to provide online services, computer systems, and technology that can withstand an average of 2.5 million cyberattacks each and every day. Since 2010, Congress cut this agency’s budget by almost $1 billion. Many of you heard me say it many times—you cannot get blood from a turnip. Together, we must and we can do more.
Madam Chair, I hope that we will continue our bipartisan work on this issue. Again, I thank you for holding this hearing, and I look forward to the witnesses’ testimony.