IRS illegally disclosed millions of taxpayer records

  • 13 November 2017
  • NormanL
IRS illegally disclosed millions of taxpayer records

IRS commissioner John Koskinen has finally left office. On his way out the door, the scandal-tarred incumbent managed to take a swipe at his inspector general, saying the in-house watchdog tended to get "carried away" in its work holding the agency accountable. But something else came to light with Koskinen's departure, and it is deeply disturbing, in part because it implicates the IRS watchdog. Our friends at the Cause of Action Institute write:

Lost in all this news—particularly, the DOJ decision not to reopen a criminal investigation—was the government’s stunning admission that confidential taxpayer information was, in fact, unlawfully disclosed by the IRS to the DOJ Public Integrity Section and the Federal Bureau of Investigation.  As Cause of Action Institute (“CoA Institute”) reported last year, the DOJ Inspector General (“DOJ-OIG”) confirmed that “protected taxpayer information was included on compact discs (CDs) that the IRS provided to the Department [of Justice] in response to a Department request.”  Those infamous twenty-one disks contained more than 1.1 million pages of return information on different tax-exempt groups.  DOJ-OIG summarily concluded that the “matter does not warrant further investigation.”  TIGTA, which was also alerted to the unlawful disclosure, refused to comment.

DOJ ostensibly sought this trove of non-public information as part of the Obama Administration’s efforts to prosecute exempt entities for engaging in prohibited political activity.  Given the pattern of IRS abuse and politicization in previous administrations, however, those stated goals were always suspect, particularly given Ms. Lerner’s involvement.  Now, in light of TIGTA’s revelations about the scope of the IRS’s targeting, progressives should be as alarmed as conservatives about the lack of accountability for one of the largest and most significant breaches of taxpayer confidentiality laws in U.S. history.

When it confirmed that taxpayer information had been mishandled, DOJ-OIG also claimed that DOJ informed Congress about the unlawful disclosure.  We filed a Freedom of Information Act (“FOIA”) request last year to investigate the matter.  That request has gone unanswered.  We filed two additional follow-up requests last month (here and here), one of which also seeks records about the processing of the 2016 request.  To date, the authorities have refused to hold anyone at the IRS or DOJ accountable for the wrongful disclosure of countless pages of Americans’ private tax information.

The IRS appears to have violated the law. Worse, the inspector general seems to be uninterested in doing its job of getting to the bottom of what happened. To top it off, the bureaucracy is ignoring requests from outside accountability groups investigating the matter.

This all stinks. Cause of Action intends to stay on the case, and we will follow and report what they discover. Fair warning -- it could take months, and a court battle, to get to the bottom of all this. But that's exactly what must happen. 

The IRS demands your private information, and is bound to keep it private. Here, they failed -- massively. We would hope the Trump Justice Department would take an interest in this matter. So far, that does not appear to be so. And that is gravely disappointing. One cannot hope to drain the DC swamp if the IRS isn't cleaned up first.