Senate Democrats, including Sens. Elizabeth Warren, Ron Wyden, and Bernie Sanders, are urging the Department of Justice to investigate the potential illegal sharing of taxpayers' personal and financial information with Meta by online tax preparation companies. The lawmakers released a 54-page report outlining their findings and calling for prosecution if any company or individual violated the law. They also sent a letter to the Internal Revenue Service, the Treasury Inspector General for Tax Administration, the Federal Trade Commission, and the Department of Justice to highlight their concerns.
According to the report, tax prep companies used computer code called pixels to transmit data to tech giants like Meta Pixel and Google Analytics. While the companies claim that the shared data is anonymous, experts suggest that it can still be used to identify individuals or create targeted advertising profiles. The tax prep companies reportedly installed the Meta and Google tools without fully understanding how much taxpayer data would be sent to these tech firms.
The lawmakers argue that by law, tax return preparers cannot disclose or use a taxpayer's information without obtaining written consent. They allege that the tax prep companies failed to obtain such consent when sharing the data with Meta and Google for advertising purposes.
In response, H&R Block and Google both emphasized their commitment to protecting user privacy. H&R Block stated that they have strict policies in place to prevent information sharing via pixels, while Google explained that site owners control what data is collected and how it is used.
The report's findings raise concerns about the potential violation of taxpayer privacy and the need for a thorough investigation into the matter. It highlights the importance of companies understanding the extent to which they share user data and ensuring compliance with privacy laws.
TaxSlayer and TaxAct, two other tax preparation companies mentioned in the report, have not yet responded to requests for comment.
Overall, the report and the lawmakers' request for investigation shed light on a potential breach of taxpayer privacy and the need for companies to be diligent in safeguarding sensitive information. The issue raises questions about the balance between data sharing for advertising purposes and protecting individual privacy.