More Privacy or Less Under Proposed IRS Rules?

A privacy proposal by the Internal Revenue Service (IRS) has apparently angered consumer advocates, tax professionals and state governments.

The IRS, in a hearing Tuesday, took comments on changes to new privacy proposals that would allow tax preparers, with the taxpayers' permission, to sell or disclose information included on their returns.


Advertisement


All Aboard the High-Velocity 2006 FRx Express! FRx Software has the engine fired up again to travel nationwide with timely training and expert guidance! Microsoft FRx and Microsoft Forecaster users, potential users and resellers don’t miss this FREE*, half-day event!

Once you’re on board, the FRx Software experts will help you gain tremendous insight into Microsoft FRx and Microsoft Forecaster. You’ll have the opportunity to hear customer perspectives and network with prospects plus pack in useful tips, and see the features and benefits of FRx Software’s financial analytic applications. Register now!


FRx Software Home Product Information
Training & Consulting Product Demo
Webcast Customer Testimonial Video



The proposed rules would change the way in which tax professionals get approval from taxpayers before sharing their tax information with third parties. The IRS said the new rule would make it clearer to consumers, through a "strong warning," that their tax information might be shared.

The IRS says companies have always had the power to reveal the information, if a taxpayer agrees. The changes, the IRS says, update the 1974 rules for modern, electronic business methods.

According to Business Week, attorneys general from 47 states called for severe restrictions or an outright ban on using tax return information for marketing. “There is simply too much at risk for American taxpayers, particularly with respect to the ongoing scourge of identity theft, to increase the likelihood that their most personal information will be stolen or misused,” they said in a letter to IRS Commissioner Mark Everson.

The Consumer Federation of America said the IRS should focus on making sure tax information is not shared for any reason. "We're trying to close the loophole that lets tax preparers sell personal information. We think that the new regulation will allow tax preparers to sell your information to an even wider group of marketers," spokeswoman Jean Ann Fox told ABC News.

And H&R Block Vice President Murray Walton said at the hearing, “We find the idea of selling tax return information repugnant.”

IRS spokeswoman Nancy Mathis told ABC News: "It requires that tax preparers must tell taxpayers that if you give consent, things can happen to your information that you may not want to happen," said. "The tax preparer can do nothing - absolutely nothing - with a tax filer's information without that consent."

The Treasury Department and IRS will now make a final a rule that takes the comments into account.

You may like these other stories...

Some of your clients may get away to business conventions from time to time. It gives them a chance to rub shoulders with colleagues, catch up on the latest developments, and fine-tune their skills. And, when the meetings or...
PwC must face $1 billion lawsuit over MF Global adviceA federal judge on Wednesday ordered PricewaterhouseCoopers (PwC) to face a $1 billion lawsuit claiming that its bad accounting advice was a substantial cause of the...
Being an accountant doesn't mean you're giving investment advice to clients. However, at tax time, accountants often have to deal with the results of any investment advice clients obtained during the year—the...

Already a member? log in here.

Upcoming CPE Webinars

Sep 9
In this session we'll discuss the types of technologies and their uses in a small accounting firm office.
Sep 10
Transfer your knowledge and experience to prepare your team for the challenges and opportunities of an accounting career.
Sep 11
This webcast will include discussions of commonly-applicable Clarified Auditing Standards for audits of non-public, non-governmental entities.
Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.