IRS to Allow Tax Preparers to Sell Your Info?

merkel writes "The Philadelphia Inquirer reports that the IRS has proposed rule changes allowing tax-return preparers, like H&R Block, to sell an individual's return information to marketers and data brokers. The proposed rule [PDF], which does contain some substantive protections for the processing of electronic returns, was published in the Federal Register on December 8, 2005. The official comment period has passed, but hearings will be held this month."

Comments

From TFA:

[ivan256]

Critics call the changes a dangerous breach in personal and financial privacy. They say the requirement for signed consent would prove meaningless for many taxpayers, especially those hurriedly reviewing stacks of documents before a filing deadline.

"The normal interaction is that the taxpayer just signs what the tax preparer puts in front of them," said Jean Ann Fox of the Consumer Federation of America, one of several groups fighting the changes.

You can't expect to protect people from their own stupidity. If the preparer can't get the tax return data this way, they can just have their customers fill out a 'financial worksheet' and sell that instead. If you're stupid enough to 'just sign' anything, you're going to have your privacy violated. This ruling is moot.

Re:Enough is ENOUGH.

[l2718]

Since the main arguments for and against various tax reform proposals depend on much more serious problems with the US Federal tax system, I think the increased taxpayer privacy attribute of the national sales tax proposal is only of marginal importance in this field. Moreover, I feel I must point out that naming your proposal the "FairTax" rather than the "National Sales Tax" is political demagoguery at its worst. This is without considering the merits of the proposal.

Re:Lets get this straight

[Suidae]

Yes, the credit reporting agencies already have that information, AND they already sell it if you have not Opted Out. This link is to the official site that lets you opt-out online, you can find the same link with Google keywords "opt out credit"

Those credit card offers in the mail that offer pre-approved cards are often based on information pulled from lists created and sold by the credit reporting agencies. This is an opt-out list, if you haven't told them not to sell your info, they are selling it to credit companies, insurance companies and debit collectors.

If you are interested in privacy, opt out now.

It's already against the law to share your stuff

[Watchman_ds]

Once again, the media has overstated a story to attract attention to a non-issue. Regardless of what the IRS decides to do about tax preparers sharing tax information, this practice is already regulated by another law: the Gramm-Leach-Bliley Act(GLBA).

GLBA was passed in 1999 to modernize aspects of the banking industry. Title V prevents financial institutions from selling consumer data without consent from the consumer. Remember a couple of years ago every bank, credit card company, loan agency, and anyone else who touched your money flooded your mailbox with Privacy Policy notices and "opt-out" statements? That was GLBA.

The best part is that GLBA classifies tax preparers as financial institutions , so H&R Block must provide the same protections to your information that a bank would (or should).

The proposed IRS rule change under section 1 specifically cites GLBA and points out that this rule change has no impact on the GLBA requirements.

Sorry to all you privacy alarmists out there, but this "Privacy Bomb" for the IRS is a dud.

Re:It isn't their information to sell.

[Maximum Prophet]

Bzzt. Wrong answer.

Filling out your Tax return is "Voluntary, but not optional"

Look it up. It's true, and the courts have upheld it. It has to be voluntary to get around your 5th ammendment rights against self-incrimination. It's non-optional because of the income tax amendment.
A somewhat weaselly explaination can be found here http://taxes.about.com/od/taxtrouble/a/back_taxes_ 2.htm