WSJ: The Internal Revenue Leak Service

Wall Street Journal editorial, The Internal Revenue Leak Service:

Democrats want to give $80 billion to the Internal Revenue Service to audit millions of Americans each year. Yet six months after the progressive website ProPublica first published the secret tax information of rich Americans, the tax agency still can’t explain what happened. Senate Republicans led by Iowa’s Chuck Grassley are demanding answers.

In a Dec. 1 letter to IRS Commissioner Charles Rettig, all 14 GOP Members of the Senate Finance Committee express frustration at how little the agency has discovered or reported on the ProPublica leak. Mr. Rettig promised when the leak occurred in June to find out what happened, but in September he told Senators, “We do not yet have any information concerning the source.” Since then it’s been crickets.

The scale alone should make investigating the breach a priority for the IRS. ProPublica claims to have thousands of individuals’ tax information, and it has continued publishing confidential details since its first report. Neither the publication nor federal authorities have said they know who leaked the records. No one seems to know, or least admit, how it was done, or how many more taxpayer files might have been stolen.

The leak is a crime, but tracing it isn’t merely a matter of criminal enforcement. The breach highlights the general failure of the IRS to protect taxpayer data. In their letter, the GOP Senators refer to several known weak points in the agency’s systems. ...

The new money for the IRS is harmful on its own terms, but it’s all the worse when it is provided without strings to an agency that has no idea who is stealing private tax data.

LAW360, 14 GOP Sens. Press IRS On ProPublica Taxpayer Data Leak

Prior TaxProf Blog coverage:

• ProPublica: America's Richest People Pay Little To Nothing In Federal Income Taxes (June 8, 2021)
• ProPublica: How Peter Thiel Turned $2,000 In A Roth IRA Into $5,000,000,000 (June 28, 2021)
• ProPublica: Why You Can’t Turn Your Roth IRA Into a Billion-Dollar Tax Shelter (July 1, 2021)
• ProPublica: The Billionaire Playbook — How Sports Owners Use Their Teams To Avoid Millions In Taxes (July 12, 2021)
• ProPublica: The Number Of People With IRAs Worth $5 Million Or More Has Tripled, Congress Says (July 29, 2021)
• ProPublica: Secret IRS Files Reveal How Much the Ultrawealthy Gained by Shaping Trump’s “Big, Beautiful Tax Cut” (Aug. 11, 2021)
• ProPublica: How The Trump Tax Law Created A Loophole That Lets Top Executives Net Millions By Slashing Their Own Salaries (Aug. 20, 2021)
• ProPublica: House Bill Would Blow Up The Massive IRAs Of The Superwealthy (Sept. 22, 2021)
• ProPublica: More Than Half Of America’s 100 Richest People Exploit GRATs To Avoid Estate Taxes (Sept. 30, 2021)
• ProPublica: 18 Billionaires Received Taxpayer-Funded Stimulus Checks During The Pandemic (Nov. 4, 2021)
• ProPublica: How These Ultrawealthy Politicians Avoided Paying Taxes (Nov. 5, 2021)
• ProPublica: More Billionaire Tax Games (Dec. 9, 2021)
• ProPublica: How Three Families Shielded Their Fortunes From Taxes For Generations (Dec. 15, 2021)