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Two GOP Lawmakers Want IRS Commissioner to Explain Missing Taxpayer Records

S.J. Steinhardt
Published Date:
Aug 28, 2023

Reacting to a recent government report that the IRS misplaced sensitive tax information, two Republican lawmakers have demanded explanations from IRS Commissioner Daniel Werfel.

In an. Aug. 25 letter to IRS Commissione r Daniel Werfel , Sen. Charles E. Grassley (R-Iowa), the ranking member of the Senate Finance Committee, and Rep. Jason Smith (R-Mo.), chair of the House Committee on Ways and Means, had a number of questions concerning a Treasury Inspector General for Tax Administration (TIGTA) finding that microfilm cartridges of fiscal year 2010 tax information, housed at three tax processing centers and containing millions of records, could not be located. The TIGTA audit faulted the IRS for “significant deficiencies in [its] safeguarding, accounting for, and physical storage of its microfilm backup cartridges” and its lack of compliance with records management requirements.

“The loss of millions of records containing sensitive taxpayer information is unacceptable,” the lawmakers wrote. “The information contained in these backup records can be used by nefarious actors to commit tax fraud and identity theft. The IRS’s lackadaisical attitude towards the loss of millions of taxpayer records containing Social Security numbers, addresses, and other sensitive tax return information is appalling. … There must be accountability to prevent this type of misconduct from occurring in the future.”

Grassley and Smith asked the commissioner if the IRS had taken any steps to locate the missing backup cartridges, to investigate the circumstances surrounding their disappearance and for a detailed explanation of those steps taken, as well as an explanation if they had not. They also asked about the actions the IRS took to recover and secure all taxpayer records in the possession of an IRS contractor that “abruptly” went out of business in 2018.

They lawmakers also questioned Werfel about the agency’s disagreement with two of TIGTA’s 13 recommendations: to take immediate action to properly secure microfilm cartridges stored at its Ogden Tax Processing Center’s Files Building to limit employee access, and to assess storage conditions at each tax processing center to ensure that the microfilm is properly stored and preserved. They also wanted to know what corrective actions the IRS has implemented to prevent another such occurrence, if affected taxpayers were notified and what, if any, corrective actions were taken against IRS employees responsible for the losses.

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