3 Tax Prep Firms Shared 'Extraordinarily Sensitive' Data About Taxpayers With Meta, Lawmakers Say

"Their 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.

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 ask 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.

Meta said that it has been clear in its policies that advertisers “should not send sensitive information about people through our Business Tools.”

“Doing so is against our policies and we educate advertisers on properly setting up Business Tools to prevent this from occurring,” the company said in an emailed statement. “Our system is designed to filter out potentially sensitive data it is able to detect.”

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.

The IRS plans to launch a pilot program for the 2024 filing season to test a “direct file” system and help the federal government decide whether to move forward with potentially implementing it in the future.