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IRS Slow to Tell of Personal Data Breaches

Thursday, 14 Jul 2011 03:53 PM

 

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The U.S. Internal Revenue Service doesn’t always promptly notify taxpayers when personal information has inadvertently been disclosed, a government review of IRS procedures has found.

The IRS failed to properly alert taxpayers to privacy breaches in 35 of 98 cases of inadvertent disclosures sampled by the Treasury Inspector General for Tax Administration, according to a report by the inspector general released today.

“Taxpayers need to be assured that the IRS will promptly notify them of inadvertent disclosures of their confidential information, so they can take appropriate steps to protect themselves from identity theft or other harm,” Inspector General J. Russell George said in a statement accompanying the report.

Inadvertent disclosures of taxpayer information can occur through mix-ups, such as sending a tax return to an incorrect fax number or mailing a return to a different person with a similar name.

The inspector general considered notifications timely if they were made within 45 days. Notification letters in the sample took an average of 86 days.

The IRS identified 1,493 cases of inadvertent disclosure that required notification of 2,812 taxpayers in 2009 and 2010, according to the report. The IRS processed more than 140 million individual returns in each of those years.

No ‘Systemic Vulnerability’

“While any inadvertent disclosure is of great concern, nothing in this report suggests any systemic vulnerability,” IRS spokeswoman Julianne Breitbeil said in a statement. “Taxpayers can be confident that their data is secure with the IRS, and protection of taxpayer data is a top priority for the agency.”

There’s no indication that any of the incidents of inadvertent disclosure examined by the inspector general led to any taxpayer harm, Breitbeil said.

George’s report made four recommendations to improve training and procedures to ensure faster notifications.

The IRS agreed with all of the recommendations.

--Editors: Bob Drummond, Robin Meszoly

To contact the reporter on this story: Andrew Zajac in Washington at azajac@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

© Copyright 2014 Bloomberg News. All rights reserved.

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