Democrats urge Biden administration to investigate data practices of tax prep companies

Several Democratic lawmakers have called on the Biden administration to ask TurboTax to keep large tax preparation firms private after a recent report found that TurboTax repeatedly pressured tax preparers to share sensitive tax data. They are calling for an investigation into their data practices.

Sen. Elizabeth Warren (D-Mass.), Sen. Ron Wyden (D-Ore.), Sen. Richard Blumenthal (D-Connecticut), Sen. Sheldon Whitehouse (D-Iowa), and Rep. Katie Porter. Congressman (Democrat of California) Washington Post coverage Starting in March, it will highlight ways taxpayers can circumvent TurboTax’s numerous efforts to force data sharing.

“TurboTax’s aggressive and potentially misleading tactics of forcing taxpayers to give up their privacy and pay for unnecessary services should be scrutinized,” the lawmakers said in the letter. letter He told multiple government officials on Tuesday.

According to the letter, Congressional staff found that the TurboTax software “tracked and asked to use taxpayer data a total of 10 times during the filing.”

TurboTax’s repeated efforts to gain access to taxpayer data follow a lawmaker investigation last year that found the tax preparation company shared the data of millions of taxpayers with Meta, Google and other major tech companies.

Specifically, the letter notes that TaxAct, TaxSlayer, and H&R Block were found to have shared “highly sensitive personal and financial information” with Meta.

“These predatory practices and flagrant violations of taxpayer trust make the recent success of IRS DirectFile, the first free and publicly available federal tax electronic filing tool in U.S. history, even more remarkable,” the lawmakers wrote.

“As the IRS prepares for the 2025 tax filing season, we will investigate the use and disclosure of legally protected and confidential taxpayer information by large tax preparation firms and prosecute companies and individuals who violate the law.” “We urge you to do so,” they added.