Wyden, colleagues urge feds to crack down on tax preparation giants’ ongoing violations of taxpayer privacy

WASHINGTON (KTVZ) -- Sen. Ron Wyden, chair of the Senate Committee on Finance, joined with four congressional colleagues last week to urge top federal officials to investigate use and disclosures of legally protected and sensitive taxpayer information by tax prep companies. 

The letter from Wyden and the four members of the Senate and House follows up on findings of the lawmakers’ July 2023 investigation that found H&R Block, TaxAct, and TaxSlayer had illegally shared the data of millions of taxpayers with Meta, and it highlights new findings about aggressive data monetization by TurboTax, which asked to track and use taxpayer data a total of 10 times during filing. 

“With this year’s tax filing season closed, and preparation already beginning for next year, we write to urge you to investigate use and disclosures of legally protected and sensitive taxpayer information by major tax preparation companies. You should identify and prosecute any company or individuals that have violated the law,” Wyden and the lawmakers wrote.

The letter was sent to Internal Revenue Service Commissioner Daniel Werfel, Federal Trade Commission Chair Lina Khan, Acting Treasury Inspector General for Tax Administration Heather M. Hill and Attorney General Merrick Garland.

“These predatory practices and shocking breaches of taxpayer trust only make the recent success of the IRS Direct File pilot – the first free, public, electronic federal tax filing tool in U.S. history – even more notable. As the IRS begins to prepare for the tax filing season in 2025, we urge you to investigate usage and disclosures by major tax preparation companies of legally protected and sensitive taxpayer information, and to prosecute any company or individuals who have violated the law,” continued the lawmakers.

In addition to Wyden, Senators Elizabeth Warren (D-Mass.), Richard Blumenthal (D-Conn.) and Sheldon Whitehouse (D-R.I.) as well as Representative Katie Porter (D-Calif.) joined the letter. 

The entire letter is here.