The return on investment for what the Internal Revenue Service reports to be a $2.7 million government system that allows citizens to obtain previous year tax returns, so far, looks to be about negative $42.7 million. The ROI could fall deeper into the red, based on revelations about a breach of the online service — although exact cost estimates for the IRS system remain hard to pin down.
In May, the IRS announced crooks had used the tool, called Get Transcript, to peek at 114,000 taxpayer files. On Aug. 17, the agency disclosed a more-extensive retroactive investigation into the matter shows crooks compromised about 220,000 additional taxpayer accounts.
Already, criminals have used some of the ill-begotten data to illegally claim tax refunds totaling about $39 million, IRS officials have said.
The exact cost of the Get Transcript service is murky. IRS officials reported to the White House Office of Management and Budget it spent $2 million on a system called “Get Transcript” and $717,000 on a system called “Get Transcripts,” according to the IT Dashboard, a federal spending website. It’s unclear why there are two systems listed. The dashboard, however, often contains outdated and incomplete data, according to numerous Government Accountability Office audits.
Nextgov, since Tuesday, has sought clarity on the distinction between the two line items. As of Friday afternoon, IRS officials could not provide an answer.
Here’s how the IRS investment became a hacking tool: Criminals in possession of previously stolen personal information on individuals used that intelligence to…