On April 18 the House passed several bills dealing with the IRS, including the 21st Century IRS Act. The bill intends to improve cyber security and the IRS’s online services. The bill requires, among other things, the IRS to work with the public and private sectors to protect people from ID theft and refund fraud. Ironically, the bill passed the day after the IRS’s online filing and payment system crashed. Can Congress solve the cyber security problem with the stroke of a pen? I doubt it. As I’ve reported, the Treasury Inspector General for Tax Administration called ID theft the “crime of the century.” It is rampant and cyber attacks go on at all levels. Even the IRS’s computers were hacked. ID theft cannot be stopped for the simple reason that with each passing year, the IRS demands more information reporting on the financial activities of individuals and businesses. There are currently more than 2 billion information returns filed each year, and the IRS wants even more. How can you possibly insure the security of information when a literal river of data flows non-stop into the IRS’s computers every day?
