Oops! Where Did the IRS Put Those Tax Records?

(RightWing.org) – President Joe Biden managed to force through additional funding for the IRS in the so-called Inflation Reduction Act (2022). With an additional $80 billion to play with, one might reasonably expect the agency to operate like a well-oiled machine — right? Nope! As it turns out, the service has reported numerous shortcomings since then, including a recent admission that it lost track of millions of tax records.

On August 8, the US Treasury Inspector General for Tax Administration (TIGTA) issued a stunning report detailing its recent discovery that IRS officials couldn’t locate sensitive individual and business account information stored on microfilm. The 30-page document began by explaining that Title 44 US Code § 3102 and the Federal Records Act of 1950 (as amended) require the IRS to back up and store tax records.

The IRS uses microfilm to store photographic records of individual and business records of a sensitive nature. The TIGTA conducts periodic reviews of those microfilm canisters to evaluate the procedures used by the tax service to “account for and secure sensitive taxpayer [data].”

That evaluation discovered “significant deficiencies” related to the “IRS’s safeguarding… and physical storage” of microfilm cartridges containing backups of sensitive information. For example, IRS officials could not locate any of the microfilm containers holding records for fiscal year 2010.

The report noted that those canisters reportedly were transferred to the Kansas City Tax Processing Center from its counterpart in Fresno, California. The TIGTA determined that millions of sensitive tax records from individuals and businesses have disappeared. Making matters worse, the report warned that those missing records could be used to commit “tax refund identity theft.”

The TIGTA report also found numerous other deficiencies. For example, it found that tax processing centers in Ogden, Utah; Kansas City, Missouri; and Austin, Texas, had not conducted their required annual inventories of microfilm containers. As it turned out, they also couldn’t produce any records regarding the last time it performed those audits.

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