Tax is a private issue, no doubt, since
it involves disclosure of income. Moreover, tax information is confidential
under US federal law. As always with the IRS, tax returns are treated with
strict confidentiality. In fact, this is something that your tax professional
and accountant must adhere to as well.
According to tax lawyers, the IRS does
not disclose your tax information to anyone unless it has your consent. In the
event of any breach by the IRS or your tax professional, you have the
right to file a civil lawsuit for damages.
The IRS or your tax professional needs
to ask your permission to share information with any third-party, and you have
the right to deny them permission as well. In addition, your tax professional
does not have the right to disclose any information to the IRS without your
prior permission. The IRS will also need your consent to release information to
your tax professional. To permit the IRS to disclose information you will need
to use Form 8821 (Tax Information Authorization) or Form 2848 (Power of
Attorney) and your tax attorney knows all about these forms.
Form
2848
This form ought to be used if you want
your tax professional, family member, or any other reliable person to handle
your tax matters with the IRS.
Form
8821
You can use this form if you want the
IRS to disclose information about your taxes to your tax professional. However,
this form will not authorize them to act on your behalf.
If you hire the services of a tax lawyer
or an accountant, make sure you receive a written copy of his or her privacy
policy.
The tax information of every employee within your
organization is also to be kept private and confidential. With increasing
incidences of identity theft, leakage of tax information can cause irreparable
damage to a victim. IRS agents or tax professionals who disclose tax
information without authorization are liable to face stiff penalties.
On the contrary though, it seems the US
government is allowing Americans to be hacked. The Chinese and Russians are
cyber attacking America every day since they do not have the innovation of
America. Regardless though, they are stealing our secrets and our President
does not care. 60 Minutes has discussed this as well as other news outlets.
China and Russia are pilfering America for its secrets and the White House
issues no ultimatum, no threats, no retaliations. It is open season on America
now.
The IRS does have a security system in
place to safeguard Americans’ tax information – hopefully it is safe enough.
To help keep your tax matters private
you ought to:
- Identify
who has access to your tax records
- Family
members and your accountant must understand that this information is
confidential
- Review the
privacy policy with your tax professional regularly
- Keep all
your tax records protected with a password and store them in a secure
location
- Pay your
taxes on time so that the government does not disclose any details on
their website
Tax
privacy: does it really exist?
The debate is still open on how private
and confidential tax information really is. The assumption is that our tax
information is confidential. However, privacy can be easily breached with the
advancements in technology as already indicated via the Russians and the
Chinese and even the North Koreans. A majority of Americans hire other people
to do their tax returns because no one in America understands the tax code,
which increases the risk of tax information being leaked.
No matter how secure their data may
seem, there is no guarantee of them not leaking your information in spite of a
privacy policy. In addition, technology has a bad side to it, with hackers and
identity thieves able to break into the securest databases, again, as already
stated but it cannot be emphasized enough.
The only thing to do if you are worried
about your tax privacy is to prepare your tax returns on your own. However,
this may not be possible as a business owner or anyone else really. The only
remedy is to make sure your tax professional has a stringent privacy policy in
place.
Remember, when you work with a tax
lawyer you are protected by the attorney-client privilege. A legal pro cannot
be compelled to disclose confidential information to any opposing party or the
IRS. So whether you face wage garnishment, bank levies, tax liens, or are even are
wrongfully accused of tax fraud, your legal counselor will protect your
interests. Unless you are Louis Roulet, a murderer, in the Lincoln Lawyer but
you are not are you!? So do not worry about that!
You can find legal help using this digital
tool: Tax.USAttorneys. With this sensational website, legal help is right
around the virtual corner!
