The tax information could be used to commit tax refund fraud, according to the Treasury Inspector General for Tax Administration, the office that conducted the report. Its review identified “significant deficiencies” in the way the IRS safeguards, accounts for and stores its microfilm backup cartridges – which the agency is required by law to keep for a certain amount of time.
He wrote that the report highlights the challenges the IRS has experienced over the last decade due to reduced funding and the attrition of experienced staff. As a result, the agency has had to shift workers to high-priority tasks and this affected its ability to update microfilm inventory records in a timely manner. The IRS’s budget fell by more than 15% in the decade leading up to 2022, leading to a decrease in both staffing levels and audit rates.
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