One of my favorite movies of all time is The Shawshank Redemption starring Tim Robbins and Morgan Freeman. For those of you living under a rock, it’s a story about a man named Dufresne who is sentenced to prison for a murder he didn’t commit. Andy was a highly educated man and when the prison warden caught wind of this, he used him as an accountant for the illegal business he was running through the penitentiary.
If you haven’t seen the movie, I highly recommend it. You won’t be disappointed. It’s one of those films that you could watch over and over again and never get tired of it. Well, clearly some folks at the Internal Revenue Service (IRS) think so. Check out the Chicago Tribune story below.
Your tax return practitioner, certified under a new U.S. Internal Revenue Service registration program, could be a jail bird.
In 2011, 66.9 million taxpayers paid for a professional to do their taxes – accounting for more than half of all individual returns sent to the IRS.
There were 962 prisoners or former convicts who received an IRS tax preparer identification number in 2011, according to an IRS inspector general report released on Thursday.
Forty-three IRS-certified tax return preparers are serving life sentences, the report said.
The IRS regulations do not prevent prisoners from getting identification numbers. The IRS said those incarcerated preparers will have their identification numbers suspended.
Prisoners and other questionable tax return preparers can slip through the certification process in part because the IRS has tabled a decision on background checks.
Earlier this year, the IRS proposed a background check and fingerprint requirement to be processed by the Federal Bureau of Investigation for certain preparers. The preparer community resisted this requirement, saying it would be too costly.
The background check requirement is still “under study,” and the IRS has no timeframe for announcing a decision, an agency spokesperson said on Thursday.
The truth is that these people might be very good a preparing tax returns, but let’s think about the exposure here: Social Security Numbers just waiting to get stolen, people’s home addresses along with a full understanding of their financial situation, birth dates, etc.
I cannot begin to tell you how much money companies like ours have spent complying with government regulations on data privacy, and in truth, I don’t begrudge it. It keeps all of us safe. But how can the same government allow this to happen? What type of background check do you think these people would have to undergo for this type of job if they weren’t in prison?