Wednesday, March 22, 2006

Taxes: The Ultimate Sell-out

There are a few things in life you just don’t do.
Pulling on Superman’s cape, selling Nigerian barges to a shell company…and marketing personal information from IRS databases. That is certain to create consternation in the general population.

The Treasury Department wants to change the rules to allow accountants and tax return preparers to sell your entire tax returns to marketers and data merchants. Treasury says it’s an “insignificant regulatory action.”

Say what?

Despite rules that would require your written consent before anyone could sell your information, this is not a good idea. If you like the way the various “do not call” lists are working, what reasonable expectations should you have about the government effectively monitoring this gambit?

U.S. Sen. Barack Obama nailed it when he said, "There is no more sensitive information than a taxpayer's return, and the IRS's proposal to allow these returns to be sold to third-party marketers and database brokers is deeply troubling.”

That’s the understatement of the year. It’s outrageous.

This change is part of the federales’ proposed regulations to “safeguard taxpayer information” as issues like overseas processing of some returns becomes an option. I always get nervous when someone says they’re “from the government, here to help.”

Curiously, no one at H&R Block and Jackson-Hewitt, which are the two largest national tax-preparation firms, are conspicuously silent on this issue.

That the IRS has only received about a dozen comments on the proposal is not too surprising, since this little item has been very quietly kept under wraps.

The formal comment period ended March 8, but you can send late comments which "may receive consideration" if you get them there pronto.

Here’s the address:

CC:PA:LPD:PR (REG-137243-02)
Room 5203
Internal Revenue Service, Box 7604
Ben Franklin Station, Washington, D.C. 20044.

Ben is spinning in his grave.

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