The Internal Revenue Service (IRS) is trying to slip a change in rules through that will allow companies that process your tax returns to sell that information to other people.The proposed rule, published on December 8, 2005 in the Federal Register, would allow companies that prepare your income tax return to ask your permission to give or sell your information to third parties. This change is being slip through as an administrative change. Privacy advocates (including me) feel this gives an open door to tax preparers to harvest detailed information about their customers. Consent must be given, but many people will not read every word that preparers put in front of them.
Quoting rule text:
The proposed regulations also allow a taxpayer to use a single document to consent to multiple uses of their tax return information….
This doesn’t seem to be the case. If the IRS was concerned about disclosure of tax return information they would make a rule the information can only be disclose to the IRS or the taxpayer.
This would allow preparers to use one consent form for several uses, only one of which they actually discuss with the taxpayer.
To quote Lou Dobbs (CNN, Mar 22, 2006), “Well, it is under the heading of, you can’t make this stuff up. The Internal Revenue Service saying that we would be sharing our personal tax information to protect the privacy of our tax information. It’s Orwellian.”
Written or electronically generated comments must be received by March 8, 2006. Outlines of topics to be discussed at the public hearing scheduled for April 4, 2006, in the Auditorium of the Internal Revenue Building at 1111 Constitution Avenue, NW., Washington, DC 20224, must be received by March 14, 2006. These regulations are proposed to apply on the date that is 30 days after the final regulations are published in the Federal Register.