No, all you enter is a raw number, no details. And few claim medical expenese in any case. After Insurance & other re-imbursements, the 7.5% floor cuts off most expeneses.
Actually it IS difficult for me to come up with something. I’m trying to think of actual abuses where the payoff would justify the costs of gathering the data. Identity theft has been mentioned, I can see that one, but I’m thinking of legal uses of this data.
Medical expenses? You are saying an insurance company would use that as an excuse to raise your premium or deny coverage? To me that just looks like a way of catching cheaters. (Getting a cheaper premium by lying about your true health status.) There are already legal ways to do this, such as requiring a physical before renewing coverage.
I do question the actual ‘power of data mining’ because I just don’t see it being used that much. Spam, junk mail, telemarketing calls, etc. are all annoying but it’s extremely rare, in my experience, to see any kind of targeting going on. Hell, one of the reasons they are so annoying is that they usually are nothing I’d be remotely interested in. I get junk mail for women-only health clubs (I’m a guy), lawn care services. (I live in a condo and don’t have a lawn.) Both of those facts are easily ‘mined’ but I don’t see any company bothering to do so. Every mailbox in my condo complex gets a lawn-care flyer every year. Landscaping is included in the condo fees so it is a complete waste of money to send those flyers. I guess the cost of the flyers is less than the cost of doing some analysis of the addresses to eliminate condos and apartments.
No, they don’t. In fact a employee who does so can lose his job or even worse. Even this change will not allow the IRS to sell your data.
LionelHutz405- I agree, I can’t think of anything much. MY out of the blue wild-assed guess would be the data might be worth maybe $5 in a discount? 
So, when the IRS said “this isn’t that big of a deal” they may have been right. Now, the IRS selling your data- whoa! :eek:
That may be; I’m uncomfortable making any real claims here as I’ve never itemized (short for “never filled out the long form”) a tax return. However, I assume that anything one claims would be open to prying eyes.
Umm…I don’t think you’re looking at this quite the right way. What I mean is, it’s not like a company is going to buy individual information; rather, they’ll pay something like 1/2 cent per name (I have no idea how much actual cost would be). Is it worth it to a company to lay out $1000 for information on 200,000 people? Of course it is.
Now think about it – what restrictions are there on who qualifies as able to buy this data? What is it that disqualifies me as a “marketing firm”, were I to have a corporate tax ID? And it’s not the legal uses that particularly bother me, as they’re mostly an annoyance (although the burgeoning number of catalogs I’ve been receiving lately bother me immensely from an environmental standpoint). It’s the illegal uses of the information that become so much easier – it’s irresponsible and foolish to ignore them.
You can’t just say ‘of course it is’ without saying what information you are talking about.
I accept your numbers are just for discussion purposes. But what information? What would they do with it that would make it worth $1,000? Give me an example.
What I’m getting at here is that it is not that hard or expensive to gather data. Turning that data into useful information is hard and expensive and therefore isn’t done as often as people think.
Oh, FF’s sake. Being an honest guy, this is tough for me. But it doesn’t take much imagination to come up with something. Here’s a contrived example, and one that may not even be disagreeable to anyone. Let’s say you’re a real estate developer in a rural area. You buy data about all the nearby farms, paying close attention to forms 943 and 4835. You now have information that may help you undercut the usual fair market price for the farmer’s land. Surely that information is worth $20 (a number I got from USA People Search; it’s the cost of 7-day unlimited access to their records, which are from your credit report – I suggest you search on your name and see what comes up).
Now imagine you’re a Wal-Mart “scout” looking for the best (read as “cheapest”) location to build a new store. Again, are you honestly going to try to claim that it’s not worth $1000 to possibly save a couple hundred thousand in choosing between locations? $10,000 for information on 2,000,000 people? Get thee to a video store and rent Wall Street; remember – information is power.
Is this information available elsewhere? I don’t know. Is it collated at a single, easily accessible source? Probably not. This would do so. As I said, perhaps that example isn’t particularly noteworthy or disagreeable, but I’m not going to go through all the tax forms to see what other information the IRS gathers; I suggest you do so and try to imagine how that information might be used. Perhaps you’ll hit on something that’ll make you a million – if this is approved.
That’s because data isn’t usually in a form that’s amenable to processing. In other words, it needs to be gathered and entered by hand – having been a data-entry person when I was younger, I can attest to what a PITA it is. Having also been in charge of writing the software to process that information (for mortgage portfolio analysis), I can also tell you how trivial it is to manipulate the data once you have it. Writing an SQL query just isn’t all that hard.
No, it would NOT- not unless all or nearly all dudes were willing to sign off on letting their preparers sell the data- and not even then, as many returns are self-prepared.
Ah, OK. So the supposition that not too many people will “sign off” on this makes it acceptable? Given the potential for abuse, we’ll just approach it with a caveat emptor attitude? Again, I ask – for what? $20 off your tax preparation?
If you don’t offer a fair market price they won’t sell to you. They will sell to the guy that does. What information on those forms is going to allow you to undercut the usual market price?
You don’t need tax information to find the cheapest location. The asking price for a piece of land is no secret.
Yes, it is. Your examples on the price of land don’t convince me. That information is easy to obtain from a real estate broker.
You’re assuming that the land is for sale. In my mind, which I admittedly did not make clear, the farmer is struggling to get by. As a developer, you can identify who is having financial difficulty and offer a not-fair price to avoid foreclosure.
Again, I submit that you’re not using your imagination. And thinking about it, if this does go through, perhaps I’ll start up a data mining business myself. Your point about receiving women’s magazines and such is well-taken; evidently, marketers who sell data don’t do a very good job of it.
I wonder if they’ll include email addresses in the data? Shit, right there one could make bank selling to spammers.
Actually last I heard there was a reward for turning in tax cheating…I will give mom a ring and see what the straight dope is these days.
Mom = IRS service center management
Ah, I see. I was assuming you meant land already for sale. Still, I see such action as being a long-shot at best. You’d need to jump in right before the foreclosure, despite what might be years of financial struggling before the farmer reached that point.
Yes, that is the source of my cynicism about such potential abuses. They can’t even seem to get the easy stuff right. (Really, it seems like they can’t even be bothered to try.) You just might make a killing with your own data mining business if you did it right.
The IRS could care less how you make your money as long as you pay your taxes on it. The local police could be far less blind to your occupation. Accoording to stories from my mother (granted anecdotal) lots of people claim illegal revenue streams and pay their taxes to avoid the nightmares that will come later if their operations are busted and have to pay back taxes as well as go to jail.
The IRS can seize your financial world in very painful ways that police departments only fantasize about.
Yeah, sorry about that. It was pretty clear in my head, anyway.
Sure. As I said, a contrived example that came from looking at just the first page of tax forms. I find it difficult to believe that Wal-Mart would not find such uses for the information. Let alone insurance companies. Political opponents. The mind boggles. Imagine it in the hands of Tony Soprano.
I’d have to violate (or at least adjust) my own ethical principles to do so. But honestly (and a little shamefully), I got a bit of a thrill thinking about actually doing it right – the intellectual challenge of finding hidden characteristics and attributes. Really and truly, with the data available in a suitable format, it’s not that difficult to find something.
Some possible scenarios.
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Give me a list of all of the households, with an income of over $100k, who maked sizable charitable donations last year. Now you have a nice list to start asking for donations, AND the do not call list doesn’t apply.
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How about a list of all households that had a new Social Security number added to it this year. Target Market = new babies.
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Gambling losses or gains? Las Vegas board of tourism might love that list.
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Stock sales gain? How about an investing house going after those.
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New mortgage interest deduction shows up = new home owners.
As far as getting permission in writing. Could it be as simple as how my local drivers license bureau does it? There is a paragraph buried on the back of page 2. If I don’t check the box asking NOT to be included, then my info can and will be sold. This would be on a form from the tax preparer, not on the tax return itself.
Worse, maybe they’d just bury a sentence in the application page that gives them permission to “allow the IRS to make your tax information available to potential third-party beneficiaries,” or something along those lines. If you happen to notice the sentence, translate it into English, and object, well then you can opt-out of the info sale, but that application form will cost you an extra twenty bucks. If you don’t like it, you can take your business elsewhere. (Of course, the next guy will do the same thing.)
And so far, what dues are propsing is that the info is worth very little. So your preparer will be able to take maybe a dollar off your fees. Few dudes will sign away for $1.
It’s NOT the IRS that will be selling the info. It’s *your * tax preparer. And, AFAIK, there’s no “application form” one signs.
[QUOTE=Tastes of Chocolate]
Some possible scenarios.
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Give me a list of all of the households, with an income of over $100k, who maked sizable charitable donations last year. Now you have a nice list to start asking for donations, AND the do not call list doesn’t apply.
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How about a list of all households that had a new Social Security number added to it this year. Target Market = new babies.
QUOTE]
How about a list of just the households who have their taxes prepared by an outside source, and which outside tax preparer is willing to sell the info, and who are willing to sign their private info away for sale to their preparer with an income of over $100k, who maked sizable charitable donations last year? Not so great after all, eh?
I’m curious as to what need is being addressed by this legislation, other than the need for tax preparers to try to make more money. Is there some national crisis where data brokers are having shortages of people’s financial data?