IRS Leaks 120,000 Taxpayers’ Info Due To “Human Coding Error”

( Before a mistake on its website was fixed on Friday, the Internal Revenue Service (IRS) disclosed the private information of roughly 120,000 taxpayers.

The IRS and Treasury Department cited a human coding error from 2021, the first year that the Form 990-T could be submitted electronically, in a letter to Congress on Friday, according to the WSJ. Users of the IRS website could download nonpublic data due to the issue found only in “recent weeks.”

According to a statement from the IRS, “Form 990-T is the business tax return used by tax-exempt entities, including tax-exempt organizations, government entities, and retirement accounts, to report and pay income tax on income generated from certain investments or income unrelated to their exempt purpose.” For 501(c)(3) organizations, the IRS is mandated to reveal this information publicly; however, a subset of non-501(c)(3) organizations, which are not required to share this information publicly, had comparable information accidentally published.

The information exposed included names, contact details, and financial details for the IRA accounts linked to Form 990-T. The IRS informed the DCNF that although the data did not contain “Social Security numbers, full account-holder information, or individual income tax returns,” it did have individual names and business contact details.

According to Anna Canfield Roth, acting assistant secretary for management at the Treasury Department, “The IRS is still reviewing this matter.”

The Treasury Department has told the IRS to quickly evaluate its procedures to ensure the essential safeguards are in place to avoid improper data leaks. They have struggled to locate staff certified to utilize its 60+-year-old COBOL tax processing system and have long-standing technological problems.

They reported that it was compelled to alert lawmakers of security breaches. The IRS informed the DCNF that affected taxpayers would be alerted in the “coming weeks.”

The data leak occurs at a difficult time for the IRS. The IRS has been in the news, with Republicans criticizing Democrats’ plan to inject $80 billion in money into the agency as part of the Inflation Reduction Act.

Democrats contend that the additional spending will increase the IRS’s capacity to offer excellent customer service, audit the nation’s wealthiest taxpayers, and generally improve resources for enforcing the tax code.

Because of the pandemic’s effects and the subsequent stimulus checks approved by Congress, the IRS still had a backlog of 9.7 million unprocessed tax returns from 2021 as of early August.