Wednesday, May 15, 2013

How ObamaCare Funded Massive IRS Data Collection Effort


Posted By Chriss Street

The Internal Revenue Service blamed “low-level” Cincinnati staff for “inappropriate” targeting of conservative political groups for audits and examinations.  I have established that the Cincinnati office is the largest of the five IRS Regional Processing Centers across the United States.  

Cincinnati has IRS authority over Delaware, where over one-million for-profit and not-for-profit entities are incorporated, and for approximately 80 million individual tax returns.  Cincinnati also has authority over Key Presidential Battleground States of Ohio, Virginia, Florida, Pennsylvania, North Carolina, New Hampshire and Michigan that contained the 68 competitive electoral votes that determined the winner of the 2008 and 2012 Presidential election.  With the Obama Administration relentlessly expanding the IRS’ “Big Data” power, the opportunities for IRS wrong-doing with this potent weapon is vast.

The IRS in 2010 employed 92,577 full-time-employees, who earned an average of $90,427 of payroll and benefits.  Nearly half of these employees work in examinations and collections.  In 2014, the IRS is expected to hire an additional 16,500 agents, auditors, examiners, and administrative support personnel to enforce large portions of the Affordable Care Act healthcare reform, referred to as Obamacare.
Cincinnati Regional Processing Center is supported by one of the most powerful mainframe computing environments in the world by their Martinsburg, West Virginia Computing Center.  With Affordable Care Act funding to prepare for the IRS management of all healthcare and Social Security data when the Obamacare is implemented in 2014, the Martinsburg Computer Center upgraded its computer mainframes to the IBM zEnterprise™ 196 Systems.  At the time, the majority of applications designed for this level of capability were military.  

By October 2010, the Internal Revenue Service had the capability to sift through emailing patterns associated with millions of individual internet addresses and have already established 32,000 categories of metadata and 1 million unique “attributes.”  The IRS continues to collect tax data, but they also are now acquiring huge volumes of personal information on taxpayers’ digital activities, from eBay auctions to Facebook posts and, for the first time ever, credit card and e-payment transaction records.  Dean Silverman, who led the IBM zEnterprise™ 196 systems upgrade bragged: “Private industry would be envious if they knew what our models are.”

Privacy watchdogs and tax lawyers have voiced alarm that the Obama Administration empowering the IRS with the predictive power of “Big Data” was implemented without public hearings or publishing any privacy safeguards.  They have warned that the Service is now engaging in “social audits,” signaling out horse-racing enthusiasts or sailboaters for special audits based solely on their lifestyles.  By screening existing data for one million unique attributes, the IRS can develop profiles and target certain types of individuals by their behaviors.

IRS officials estimate that 80% of the 254 million tax returns it processes this year will be filed electronically.  U.S. Tax Court records reveal that information gathered from e-filers’ Facebook and eBay postings has already been used by the IRS to defend tax challenges.  Under aFreedom of Information Act, privacy advocates at the Electronic Frontier Foundation obtained and published a copy of the IRS’s 38-page manual used for training auditors to snoop in social media postings for enforcement opportunities.
Jeff Butler, IRS Director of research databases told the IBM TechAmerica conference last November said the Internal Revenue Service’s computers can load all 15 terabytes of data in 10 hours from the 254 million returns that will be filled this year, compared to four months eight years ago.  Despite this huge amount of complexity, the IRS is only using 1.5% of the new system’s storage capacity at this time.

Yesterday, I published a copy of a hand signed Memorandum from Steven T. Miller, IRS Acting Commissioner, revealing that on March 23, 2011 he Warned Employees Not to Target 501(c)4 Donors.  The funding from Obamacare allowed the Martinsburg Computer Center to receive a complete military level “Big Data” upgrade to IBM zEnterprise 196™ Systems.  The IRS could positively employ the predictive power of Big Data to improve cost efficiency and provide better customer service.  But the IRS also now has the equivalent “Big Data” cybernetic power of the Star Trek Borg hive that in the wrong hands could be used to mercilessly track and attack enemies.

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