Senate Finance Committee member Mike Krapo, R-Idaho, responded to an investigation revealing tactics used by the super-rich to evade income taxes by asking the Government Accountability Office to report how the Internal Revenue Service protects sender information.
“The latest news reports on tax returns and states that the news organization has a large amount of IRS tax data for certain types of taxpayers. In light of this, you have asked us to review the IRS’s tax protection policies, “the May 19 observer report, entitledCharacteristics of cases of unauthorized access and disclosure of employeesGAO has identified Krapo as an applicant for Congress.
The news report cited in the GAO footnotes is expose ProPublica published last summer using tax information from people like Elon Musk, Jeff Bezos and Michael Bloomberg to highlight patterns – including a buy-and-borrow-and-die strategy that allows people with enough money to enjoy a affluent lifestyle while sometimes do not pay federal income taxes at all.
ProPublica said it received the confidential information through a channel it set up so that whistleblowers could share information anonymously and that the source – who is unknown to them – said they were motivated by reporting that the store has done about how the agency’s lack of resources makes the IRS focus more on auditing the poor than the extremely rich.
But “Revealer” is a loaded term and laws offering protection to those who disclose certain information, regardless of purpose, may not allow such persons to be exempt from serious consequences.
“According to the Internal Revenue Handbook, IRS employees are required to disclose tax information only if there is a legal basis that allows disclosure, proper permission has been granted to disclose this information, and there are written disclosure procedures in place,” GAO reported. . “Violations of criminal unauthorized access are punishable by a fine of up to $ 1,000 or imprisonment for no more than one year, or both, together with the costs of prosecution. In case of a sentence, the employee is terminated. Deliberate unauthorized disclosure of a tax return or information on a return is a crime punishable by a fine of up to $ 5,000, up to five years in prison, or both, plus the cost of prosecution.
ProPublica it was also careful to deal with the impact of SolarWinds hacking on the federal government and the possibility of information being provided to them by a foreign adversary. However, the news team noted, the Ministry of Finance said that personal tax information had not been compromised as a result of this hacking campaign.
The GAO report was signed by Jennifer Franks, director of the Center for Improved Cybersecurity, and Jessica Lucas-Judy, director of tax affairs. He noted that “all upgraded IRS systems containing taxpayer data are required to send their system and program transactions to the Security Audit and Analysis System,” a central data warehouse that collects logs from various applications.
This allows the IRS and the chief financial inspector of the tax administration to “detect potential unauthorized access to IRS systems and data and reconstruct events for potential criminal investigations,” the report said. “The [IRS] The cybersecurity service then referred all incidents to TIGTA for investigation. According to IRS officials, the cybersecurity service also finds out about incidents from the Ministry of Finance. When the Ministry of Finance notifies the cybersecurity service of an incident, the service must carry out an analysis and, if necessary, refer it to TIGTA.
The report details various processes and bodies through which employees can appeal their managers’ decisions – usually two to three levels up – in cases of unauthorized disclosure.