IRS leaked thousands of Americans’ tax filings; Congress demands to know if it was political

The new head of the powerful House Ways and Means Committee blasted the Biden administration for giving few answers after thousands of taxpayer files were leaked to an outside group.

House Ways and Means Chairman Rep. Jason Smith, R-Mo., sent a letter to Russel George, the Treasury Department’s Inspector General for Tax Administration, raising concerns about the leak of “confidential tax information" and the lack of accountability over that leak.

The issue began when the news group ProPublica reported in June 2021 that it had been given private tax returns for thousands of Americans spanning over 15 years.

From ProPublica:

Thanks to an analysis of its unprecedented trove of IRS data, ProPublica is revealing the 15 people who reported the most U.S. income on their taxes from 2013 to 2018, along with data for the rest of the top 400.

The analysis also shows how much they paid in federal income taxes – and it demonstrates how the American tax system, which theoretically makes the highest earners pay the highest income tax rates, fails to do so for the people at the very top of the income pyramid. The top 400 earners pay noticeably lower tax rates than the merely rich; and, if you include payroll taxes, a married couple making $200,000 a year could end up paying higher tax rates than a person making $200 million a year.

The leak may have had political motives, since it was used to prove, as ProPublica put it, that “the very richest pay lower rates than the merely rich.”

Who was responsible and who will be held accountable are now the lingering questions. Rep. Smith's letter came the same week that Biden’s nominee to lead the tax-collecting agency took a series of tough questions from the Senate Finance Committee as part of his confirmation process.

In a different hearing, Treasury Secretary Janet Yellen told the Senate Finance Committee in June 2021 that she would look into the leak.

“[Yellen] also indicated that she would keep Congress updated on the matter. Yet, nineteen months after this outrageous leak, Congress, and, more importantly, the American people have no idea how this betrayal of taxpayer confidentiality happened or whether anyone has been held accountable,” Smith wrote in his letter.

Yellen said the Treasury Inspector General for Tax Administration would handle the matter, but so far few answers have been released, hence Smith’s letter.

“A detailed status of this review is necessary to ensure TIGTA is conducting a comprehensive investigation that will be completed in a timely manner…” the letter said. “This leak of taxpayer information cannot be ignored, and TIGTA as well as the IRS can be confident that the Ways and Means Committee will work tirelessly to ensure accountability. Congress and the American people should not have to wait years to get answers.”

Meanwhile, the IRS is steeped in other issues. As The Center Square previously reported, the agency faces major backlogs, serious scrutiny over how it will handle $80 billion handed down via the Inflation Reduction Act, questions over millions of destroyed documents and more.