UNITED STATES NEWS

3 tax prep firms shared ‘extraordinarily sensitive’ data about taxpayers with Meta, lawmakers say

Jul 12, 2023, 3:55 AM

WASHINGTON (AP) — A group of congressional Democrats reported Wednesday that three large tax preparation firms sent “extraordinarily sensitive” information on tens of millions of taxpayers to Facebook parent company Meta over the course of at least two years.

Their report urges federal agencies to investigate and potentially go to court over the wealth of information that H&R Block, TaxAct and Tax Slayer shared with the social media giant.

In a letter to the heads of the IRS, the Justice Department, the Federal Trade Commission and the IRS watchdog, seven lawmakers say their findings “reveal a shocking breach of taxpayer privacy by tax prep companies and by Big Tech firms.”

Their report said highly personal and financial information about sources of taxpayers’ income, tax deductions and exemptions was made accessible to Meta as taxpayers used the tax software to prepare their taxes.

That data came to Meta through its Pixel code, which the tax firms installed on their websites to gather information on how to improve their own marketing campaigns. In exchange, Meta was able to access the data to write targeted algorithms for its own users.

The program collected information on taxpayers’ filing status, income, refund amounts, names of dependents, approximate federal tax owed, which buttons were clicked on the tax preparers’ websites and the names of text entry forms that the taxpayer navigated, the report states.

The letter to federal agencies was signed by Sens. Elizabeth Warren, Ron Wyden, Richard Blumenthal, Tammy Duckworth, Bernie Sanders and Sheldon Whitehouse and Rep. Katie Porter. The lawmakers called for the agencies to “immediately open an investigation into this incident.”

They ask the agencies to investigate “and prosecute any company or individuals who violated the law,” saying it could result in billions of dollars in criminal liability to the firms.

The Markup, a nonprofit journalism outlet focusing on technology, initially reported on the data-sharing between tax firms and Meta.

TaxAct told The Markup that it takes the privacy of its customers’ data “very seriously” and ”endeavors to comply with all IRS regulations.” H&R Block said it has an “ongoing commitment to privacy” and regularly evaluates its practices. TaxSlayer said that its customers’ privacy is “of utmost importance” and that it had removed the Pixel to evaluate its use.

Meta did not immediately respond to an email seeking comment.

Representatives from the IRS, the DOJ, the FTC and the IRS watchdog also did not immediately respond to requests for comment.

The Democrats say their report serves as an argument for the creation of an electronic free-file system for submitting tax returns that would be run by the government, which the IRS is currently piloting.

The IRS plans to launch a pilot program for the 2024 filing season to test a “direct file” system and help the federal government decide whether to move forward with potentially implementing it in the future.

The IRS in May published a feasibility report laying out taxpayer interest in direct file, how the system could work, its potential cost, operational challenges and more.

The report shows that the majority of surveyed taxpayers would be interested in using an IRS-provided tool to prepare and file their taxes electronically — almost 50% of respondents who preferred the IRS free-file option over commercial tax preparation firms said they preferred to give their financial information directly to the IRS instead of the third party.

United States News

Associated Press

Trump’s history-making hush money trial starts Monday with jury selection

NEW YORK (AP) — In a singular moment for American history, the hush money trial of former President Donald Trump begins Monday with jury selection. It’s the first criminal trial of a former commander in chief and the first of Trump’s four indictments to go to trial. Because Trump is the presumptive nominee for this […]

2 hours ago

Tracy Toulou...

Associated Press

How to tackle crime in Indian Country? Empower tribal justice, ex-Justice Department official says

A recently retired director of the Justice Dept. says the federal government hasn't given tribal justice systems equal recognition.

4 hours ago

Speaker of the House Mike Johnson...

Associated Press

House Speaker Mike Johnson says he will push for aid to Israel and Ukraine this week

House Speaker Mike Johnson said Sunday he will try to advance wartime aid for Israel this week, along with funding for Ukraine.

5 hours ago

Associated Press

Semiautomatic firearm ban passes Colorado’s House, heads to Senate

DENVER (AP) — Colorado’s Democratic-controlled House on Sunday passed a bill that would ban the sale and transfer of semiautomatic firearms, a major step for the legislation after roughly the same bill was swiftly killed by Democrats last year. The bill, which passed on a 35-27 vote, is now on its way to the Democratic-led […]

7 hours ago

Associated Press

Four people charged in the case of 2 women missing from Oklahoma

Four people were arrested and charged with murder and kidnapping over the weekend in connection with the disappearances of two Oklahoma women. Veronica Butler, 27; and Jilian Kelley, 39, of Hugoton, Kansas, were driving through the Oklahoma panhandle to pick up Butler’s children for a March 30 birthday party in Kansas but never showed up. […]

12 hours ago

Associated Press

Detectives solve 1968 killing of World War II veteran who became milkman, Florida sheriff says

VERO BEACH, Fla. (AP) — More than five decades after a World War II veteran was slain while working as a milkman in Florida, investigators say they’ve solved the case thanks to two people who came forward after the killer died. Hiram “Ross” Grayam was delivering milk in April 1968 and failed to return home […]

13 hours ago

Sponsored Articles

...

DESERT INSTITUTE FOR SPINE CARE

Desert Institute for Spine Care is the place for weekend warriors to fix their back pain

Spring has sprung and nothing is better than March in Arizona. The temperatures are perfect and with the beautiful weather, Arizona has become a hotbed for hikers, runners, golfers, pickleball players and all types of weekend warriors.

...

COLLINS COMFORT MASTERS

Here are 5 things Arizona residents need to know about their HVAC system

It's warming back up in the Valley, which means it's time to think about your air conditioning system's preparedness for summer.

(KTAR News Graphic)...

Boys & Girls Clubs

KTAR launches online holiday auction benefitting Boys & Girls Clubs of the Valley

KTAR is teaming up with The Boys & Girls Clubs of the Valley for a holiday auction benefitting thousands of Valley kids.

3 tax prep firms shared ‘extraordinarily sensitive’ data about taxpayers with Meta, lawmakers say