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Smith, Schweikert Push IRS for Information and Accountability on Improper Disclosure of Confidential Taxpayer Information

March 2, 2023 — Blog    — Letter    — Oversight    — Press Releases    — Supercharged IRS   

WASHINGTON, D.C. – Taxpayers whose privacy has been repeatedly abused and their financial information leaked by the government deserve answers from the Internal Revenue Service (IRS), wrote House Ways and Means Committee Chairman Jason Smith (MO-08) and House Ways and Means Subcommittee on Oversight Chairman David Schweikert (AZ-01) in a new letter to Acting Commissioner of the IRS Douglas O’Donnell.

Not once, but twice, the IRS posted on its website information from a form used by certain retirement account holders. These disclosures impacted the private information of over 100,000 taxpayers, raising serious concerns about the agency’s ability to carry out its mission, wrote Smith and Schweikert:

“The fact that the Internal Revenue Service (IRS) improperly published confidential taxpayer information once is bad enough. The fact that the agency put months into resolving the issue only to republish the exact same confidential taxpayer information again raises alarms about whether the agency is capable of upholding the fundamental principles – both legal and ethical – that are supposed to be part of the agency’s core mission. The Committee on Ways and Means needs to gather documents and information to understand how this happened multiple times, and what the agency – and potentially Congress – needs to do to make sure it does not happen again.”

Following its discovery of the first improper disclosure of confidential tax information that occurred in August 2022, the IRS issued a report detailing the length and nature of the improper disclosure as well as the IRS’s attempt to get to the bottom of the failure, which Smith and Schweikert summarized in their letter:

  • “The improperly disclosed data was publicly available online for approximately eight months before the agency detected the error.
  • A summary of what was disclosed, the types of taxpayers impacted, the type of information disclosed, and provided a series of “preventative measures” the IRS would take to address the root cause of the August Disclosures.
  • The information disclosed included names, phone numbers, business addresses, compensation attributable to unrelated businesses, preparer tax identification numbers, and limited financial information.”

Smith and Schweikert have requested that the IRS provide key documents and communications related to the matter.

Read the letter here.

Background:

  • On September 2, 2022, the Treasury Department notified Congress of an inadvertent disclosure of confidential taxpayer information which the agency discovered on August 8, 2022.
  • IRS’s discovery of the data disclosure came approximately eight months after the information was posted online.
  • On November 23, 2022, the IRS republished the confidential data of about 112,000 taxpayers – which remained online until early December 2022.
  • Among the information posted were names, phone numbers, business addresses, and compensation attributable to unrelated businesses.