IRS loses hundreds of laptops, fails its own audit

Washington (DC) - Over the past few years, the Internal Revenue Service has lost several hundred laptops according to a new report from the IRS Inspector General J. Russell George. Between 2003 and Feb 2006, the IRS lost nearly 500 laptops mostly from agents’ homes and cars. In addition, 111 of those laptops were either lost or stolen right from IRS offices.

The report criticizes agents for leaving unencrypted taxpayer data on the laptops and for failing to inform the affected taxpayers about the data theft, something major corporations are mandated to do by various state and federal laws. "The Internal Revenue Service is not adequately protecting taxpayer data on laptop computers," says the report.

A typical IRS laptop would have around 10 to 25 active tax cases, but some of the more "gung-ho" agents could have several dozen cases stored on their laptops.

You can read the entire 42-page report here.