IRS Blocking Release of Records on 2021 Breach of Taxpayer Information

One year after the breach, the IRS refuses to give any answers

June 8, 2022

(Washington, DC) – Today, the Functional Government Initiative (FGI) announced litigation against the Internal Revenue Service (IRS) for violating transparency obligations surrounding the unlawful leak of confidential taxpayer information to ProPublica.

On June 8, 2021, ProPublica released a report that contained the confidential taxpayer information of several wealthy American citizens. The confidential data, protected by law, was obtained either through a breach of the IRS’s systems or through an illegal internal leak. It has been exactly one year since ProPublica posted the stolen confidential data, yet there has been no word from the IRS on what it is doing to discover the source of the leak or implement new systems less susceptible to cyber attacks. Since the breach, the administration has pushed for the IRS to have more oversight than ever before on the finances of American citizens. This request from the administration is alarming itself, but what seems more troublesome is that the IRS would have access to more confidential information than ever before without being able to show that they can protect the current data they already possess.

In February 2022, FGI began looking into the IRS’s internal handling of the leak and any progress they have made in discovering the source of the leak and/or breach. Initially, the IRS appeared to be willing to work with FGI. However, in May after months of conversations with the IRS, they denied FGI’s request to obtain these documents. FGI believes that litigation is now the only course to force the agency to release these documents so the American people can know what they are doing – if anything – to ensure that confidential information for all taxpayers is protected.

Peter McGinnis, spokesman for FGI, issued the following statement:

“It has been 365 days, and the IRS still has no answer for how ProPublica obtained the confidential taxpayer information of American citizens. With a breach as detrimental to the integrity of the IRS as this, one would think that the agency that has access to every American’s private financial information would do everything in their power to discover the source quickly and in a manner that revives public trust in the Service. The systemic issues that allowed the leak, however, appear to be just the latest example of dysfunction plaguing the Service.”