The Internal Revenue Service is currently in damage control mode after the US tax entity revealed that it had made a humongous blunder. According to sources, about 120,000 individuals have been affected by the inadvertent mistake committed by the agency. The leak involve people who completed the 990-T tax return form, which comprises of very sensitive information.
The unintentionally released IRS documents are associated with ‘unrelated business income that is paid out to tax-exempt entities, each year. These are establishments that include nonprofit organizations, inclusive of all charitable entities in the USA. Individuals filing IRA and SEP retirement plans were also affected as these are reported to the IRS on Form 990T.
For the majority of the people filing taxes each year, usually, these tax forms remain confidential from the public domain but can be accessed only by employees of the IRS. However, with charitable taxpayers, Form 990-T must remain accessible for three years to the general public.
Additionally, the damages involve leaked IRA reported income of funds obtained from sales unrelated to a nonprofit entity, or money earned from real estate assets that generate income.
Along with the IRAs and Form 990-T mishaps, the IRS disclosed that other private data was unintentionally leaked, as well.
Breached Private Data
According to the IRS, it recently discovered the incident that involves the machine-readable (XML) Form 990-T. In its report, the income tax entity stated that the leaked data was made accessible for bulk download on its Tax Exempt Organization Search (TEOS) portal.
The IRS, additionally revealed that while the breached documents have been made public, other frequently accessed TEOS forms were not affected; these are for individuals that access the section that includes machine-readable data.
The Wall Street Journal was the first news entity to reveal the breach committed by the IRS. Its article revealed that the information disclosed has the names, and contact details, as well as the reported income of more than 120,000 IRA accounts.
However, the IRS in a released statement announced that the social security numbers, individual tax filings, or comprehensive account details were not involved with the leaked tax forms. Already, a report was made to the US Congress, after a research employee at the IRS discovered the massive data leak.
So far, the IRS reported it had rectified the unintended data breach, and promised to notify all affected taxpayers shortly.