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Former IRS consultant pleads guilty to stealing and sharing Trump (and others) tax data

Update, Monday, Jan. 29, 2024: Former IRS contractor Charles Littlejohn today was sentenced to five years in prison for disclosing tax return information without authorization. 

Update, Friday, Oct. 13, 2023: Former IRS contractor Charles Littlejohn pleaded guilty on Oct. 12 in federal court to disclosing tax return information without authorization. As noted in the post below, the compromised tax data was that filed by former president Donald J. Trump, and billionaires Jeff Bezos, Elon Musk, and Warren Buffett, among others. The tax material was given to two separate media organizations, which published stories based on the information. Littlejohn's sentencing hearing is scheduled for Jan. 29, 2024. He faces a maximum penalty of five years in prison.

Confidential eyes only or not stamps


The eighth article of the Internal Revenue Service’s Taxpayer Bill of Rights guarantees taxpayers the right to confidentiality. That includes, says the IRS, the assurance that the agency — i.e., its employees — may not disclose your tax information to third parties unless you give permission, for example, allow release of tax information so you can get a loan.

Even more crucial is the federal law regarding tax privacy.

Section 6103 of Title 26, the Internal Revenue Code (IRC) component of the U.S. Code, requires confidentiality for tax return information.

Section 7213 of the IRC states that willful disclosure of federal tax returns or return information is a felony. Conviction of such illegal disclosure is punishable by a fine of up to $5,000, or imprisonment for a maximum of five year, or both, together with the costs of prosecution.

That’s what one former IRS contractor is facing.

Accusations of tax return info theft: The Department of Justice (DoJ) has charged a 38-year-old Washington, D.C., man with stealing tax return information associated with a high-ranking U.S. government official, and giving the info to a news organization.

The charged man, whose name I’m not sharing here but is listed in the DoJ announcement and court filing, also is accused of stealing tax return information for thousands of the wealthiest individuals in the United States, and disclosing that tax return data to another news outlet.

The government official is cited as Public Official A in the official criminal charge. However, multiple media outlets have reported that A is former president Donald J. Trump. Billionaires Jeff Bezos, Elon Musk, and Warren Buffett were among the more than 150 rich and famous whose returns were compromised.

The two organizations that received the tax information reportedly were the New York Times and ProPublica. Neither has been accused of any wrongdoing.

Court filing specifics: Officially, the defendant has been charged with one count of unauthorized disclosure of tax returns and return information. The Treasury Inspector General for Tax Administration (TIGTA) is investigating the case.

The official charging document says —

“From in or about 2018 until in or about 2020, while Defendant was working on an IRS contract, he stole tax returns and return information associated with Public Official A and thousands of the nation’s wealthiest people, including returns and return information dating back more than 15 years. He thereafter disclosed the tax information associated with Public Official A to News Organization 1 and the other tax information to News Organization 2. Both news organizations published numerous articles describing the tax information they obtained from the Defendant.”

In addition, says the filing —

“From in or about August 2019 until in or about November 2020, in the Northern District of West Virginia and elsewhere, Defendant … did willfully disclose to any person, without authorization, any return or return information, as defined in 26 U.S.C. § 6103(b), to wit, the tax returns and return information of Public Official A and thousands of other persons.”

Again, this is just a charge. The man has not yet entered a formal plea. He is presumed innocent until proved guilty.

Tax felon friday_smallerTax Felon Friday: The ol’ blog’s end-of-week feature highlighting tax crimes usually examines cases of individuals accused or convicted of ripping off the IRS and U.S. Treasury via illegal tax filing schemes.

But the sanctity of every American’s private tax information warrants adding this charge to the Tax Felon Friday files.

Also of note is a related report from CNN that prosecutors are suggesting creation of a website to notify victims whose tax returns were allegedly stolen by the accused man.

Federal law requires that prosecutors notify any crime victims they can identify. There’s a similar notification rule for the IRS regarding improper disclosure of taxpayer information.

Prosecutors say they have notified, via U.S. Postal Service mail and phone, some of victims whose information was published. However, they argue that notifying thousands of victims that way “would be impractical.”

Instead, a webpage on the DoJ website would provide a case summary, information, and updates on the case, as well as hearing schedules and documents in the case. It also would, according to the CNN story, “contain an e-mail address through which individual potential crime victims could contact the Department of Justice with questions regarding the case.”

While we wait for the taxpayer data theft case to proceed, you also can catch up on previous tax crime posts, including those that were published long before I gave them a special designation, in the, what else, tax crimes category. You'll find this post at the top of that collection right now, so just scroll down for more.

You also might find these items of interest:

 

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