US Tax Prep Giants Leaked Taxpayer Data to Meta, Google, Democrat Lawmakers Claim

Several of the largest tax preparation companies in the United States shared sensitive personal and financial data of users with tech behemoths Meta and Google, according to a bombshell report released by prominent Democrat lawmakers. 

The report, which was prepared by the offices of Senators Elizabeth Warren, Ron Wyden, Richard Blumenthal, Tammy Duckworth, Bernie Sanders and Sheldon Whitehouse as well as Rep. Katie Porter investigated claims from a November, 2022 report in The Markup that TaxSlayer, H&R Block and TaxAct did not protect customer data they shared with Meta, nor did they gain consent to share the data from customers.

The report alleges that the three tax companies used pieces of code called pixels and other software tools made by Meta and Google on their websites — these websites are used by millions of US taxpayers to fill out their tax returns. The report said the tools funneled taxpayers' personal data to Meta and Google without the tax prep firms' full understanding or knowledge of what data were sent and how it might be stored or used by the tech giants.

The use of these tools was “shockingly careless,” the report stated, and were used “without fully understanding the extent to which they would send taxpayer data to these tech firms.”

In a statement sent to The Messenger, a spokesperson for Meta said the company has clear policies warning advertisers not to send sensitive information through the company’s suite of business tools.

“Doing so is against our policies and we educate advertisers on properly setting up Business tools to prevent this from occurring,” Meta's spokesperson said. “Our system is designed to filter out potentially sensitive data it is able to detect.”

A spokesperson for Google said there are "strict policies and technical features that  prohibit Google Analytics customers from collecting data that could be used to identify an individual. Site owners - not Google - are in control of what information they collect and must inform their users of how it will be used."

TaxAct told The Messenger in a statement that the company "has engaged with Senator Warren and her staff to provide transparent, detailed explanations on our use of these standard analytics tools. TaxAct has always complied with laws that protect our customers’ privacy and, as noted in the report, we disabled the tools in question while we evaluated potential concerns."

A spokesperson for H&R Block sent The Messenger a statement saying only that the company "takes protecting our clients’ privacy very seriously, and we have taken steps to prevent the sharing of information via pixels.” 

Representatives for TaxSlayer did not immediately respond to The Messenger's request for comment.

By implementing these pixels without informing their users, the lawmakers allege that the trio of firms may have not just acted unethically but violated taxpayer privacy laws that could come with $1,000 fines per violation. Given the scope of the data allegedly shared, that could mean billions of dollars in penalties. 

The report authors called on a variety of government agencies to conduct investigations, including the Department of Justice, Internal Revenue Service and Federal Trade Commission. They also called on the IRS to release its own online tax filing system, the development of which is underway. 

The Democratic lawmakers did not immediately respond to The Messenger's request for comment.