The IRS needs to do more to make sure that federal tax data is kept protected, according to a new inspector general report.
{mosads}The tax agency is required by law to ensure that federal tax information (FTI) given to federal, state and local agencies is well guarded.
But Treasury’s inspector general for tax administration found that the IRS only does on-site reviews at an agency after the tax information is released. The IRS also doesn’t have background requirements for what federal employees and contractors handling tax information at other agencies, and doesn’t test agency background checks.
“If required safeguards for FTI are not established and maintained, the FTI is at an increased risk of unauthorized use and disclosure,” Russell George, the tax administration inspector general, said in a statement.
Agencies that receive tax information are supposed to formally lay out how they’ll protect that data at least every six years. The IRS had been doing on-site checks once every one to three years, but is now deciding when to do those reviews on a case-by-case basis.
The inspector general also found that none of the 15 agencies it examined required the same level of background checks as the IRS did for handling tax information.
The IRS requires fingerprinting, credit and law enforcement checks, and personal interviews and references. But of the 15 agencies, only four conducted fingerprint testing and one conducted national-level background checks.
The agency now says it will implement requirements for other agency employees or contractors handling tax information.