Facebook's Use of Data May Annoy You, But IRS Handling of Your Sensitive Information Is Truly Chilling

When it comes to mishandling the details of your life, social media has nothing on the tax man.


Yoko Aziz/agefotostock/Newscom

As we argue over the propriety of Facebook hoovering up personal (but not especially sensitive) information that users voluntarily gave to the social media company, it's a good time to remember that many of us are right now surrendering delicate details of our life to an even less trustworthy entity—the Internal Revenue Service (IRS)—and we have no choice.

Using a feature of Facebook that was abandoned in 2015, third-party apps were, for several years, able to compile fairly detailed profiles on users who installed them. Among other destinations, the information made it to political campaigns for use in targeted electioneering (variously characterized as innovative when the Obama campaign bragged about its tech savvy, and nefarious when it benefited Trump). This info-siphoning struck many people as creepy as hell (almost certainly why Facebook killed the feature three years ago), but it was based on freely surrendered data through a service that nobody was compelled to use. Anybody uncomfortable with Facebook's policies can just close their account (or creatively populate it with bogus info).

By contrast, you can't just walk away from IRS demands for the details of your finances, your business, your property, and your family. The tax agency gets very pissy, indeed, if you turn up your nose at demands for information, warning that "the IRS may assess penalties to taxpayers for both failing to file a tax return and for failing to pay taxes they owe by the deadline."

Boris Johnson, when he was mayor of London (you, know, in the U.K.), was slapped with an enormous tax bill by the United States IRS because he was born in this country, though he left by the age of 5. The only way he was able to escape threats of arrest should he ever return to the land of his dimly remembered childhood was to pay the tab and then renounce his American citizenship.

The purposes to which the IRS turns that extracted data are more chilling, too—and that's just if we're talking about the intentional funding of an ever-metastasizing state that exists to push you around and turn out your pockets to fund its efforts to become yet pushier. By comparison, targeted political messages at which you roll your eyes before scrolling by are nothing but minor annoyances. You have nobody to blame but yourself if you actually pay attention to those ads.

But the IRS has a pretty impressive history of not just putting coercively extracted information to questionable uses, but also of storing it carelessly, leaking data through every possible conduit, and hiring employees who appear to only marginally prefer a career in tax collection over knocking over liquor stores. That is, it might be fun to see Mark Zuckerberg field a battery of ill-informed and frankly stupid questions from those members of our society diagnosed as senators. But it would be much more productive if a long line of IRS employees stood behind him, awaiting their turn.

Ryan Payne, for instance could have taken a few moments to field some questions about the course of events that led the former IRS agent to plead guilty earlier this year to using other people's Social Security numbers—information acquired during business audits—while applying for a loan and a bank account.

For their part, Della Ornelas and Randall Ruff could have delved into their long and mutual interest in combining tax collection with fraud—shared tastes that led them first to multi-decade careers at the IRS, to marriage, and then prison.

Maybe senators could have pressed representatives of The Treasury Inspector General for Tax Administration about their puzzlement, expressed in a February report, as to why "the IRS issued more than $1.7 million in awards to 1,962 employees who had a disciplinary or adverse action… Some of these employees had serious misconduct such as unauthorized access to tax return information, substance abuse, and sexual misconduct."

And then there are the over 700,000 Social Security numbers and other sensitive records swiped by hackers from IRS computers over the past couple of years. Yes, that's far smaller than the millions of records shared by Facebook. But the social media data featured information about preferences and beliefs that people voluntarily shared—even if they didn't intend it to go to a marketing company. The IRS data, meanwhile, included information few people would surrender in the absence of threatened fines, penalties, and imprisonment. That kind of breach carries serious consequences.

How serious? Well, when hackers extracted information on nearly 100,000 college students from the IRS Data Retrieval Tool last year in a separate breach, they were able to steal upwards of $30 million. And the victims remain at risk of ongoing identity theft because of the sensitive nature of the information the tax agency forces us to file.

The IRS itself estimates that it paid out $5.8 billion worth of bogus refunds in 2013 as a result of identity theft. And there's no greater repository of sensitive information—and apparently no worse guardian of that data—than the tax agency.

So it's understandable that you're annoyed when you sign into your social media account and you contemplate the potential uses of your pictures and posts. But the logical reaction, as you file required information for tax day with the IRS, is less annoyance and more a healthy dose of fear.