A group of congressional Democrats reported today that three large tax preparation firms sent “extraordinarily sensitive” information on tens of millions of taxpayers to Facebook parent company Meta over the course of at least two years, according to the Associated Press.
The report urges federal agencies to investigate and potentially go to court over the wealth of information that H&R Block, TaxAct, and Tax Slayer shared with the social media giant.
That data came to Meta through its Pixel code, which the tax firms installed on their websites to gather information on how to improve their own marketing campaigns. In exchange, Meta was able to access the data to write targeted algorithms for its own users.
The program collected information on taxpayers’ filing status, income, refund amounts, names of dependents, approximate federal tax owed, which buttons were clicked on the tax preparers’ websites, and the names of text entry forms that the taxpayer navigated, the report states.
The letter to federal agencies was signed by Sens. Elizabeth Warren, Ron Wyden, Richard Blumenthal, Tammy Duckworth, Bernie Sanders, and Sheldon Whitehouse, and Rep. Katie Porter. The lawmakers called for the agencies to “immediately open an investigation into this incident.”
They asked the agencies to investigate “and prosecute any company or individuals who violated the law,” saying it could result in billions of dollars in criminal liability to the firms.
TaxAct told The Markup that it takes the privacy of its customers’ data “very seriously” and “endeavors to comply with all IRS regulations.” H&R Block said it has an “ongoing commitment to privacy” and regularly evaluates its practices. TaxSlayer said that its customers’ privacy is “of utmost importance” and that it had removed Pixel to evaluate its use.
The Democrats say their report serves as an argument for the creation of an electronic free-file system for submitting tax returns that would be run by the government, which the IRS is currently piloting.
