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Footnotes · IRS debacles

IRS Debacles: A Chronology, 2010–2026

The agency that holds everyone’s most private financial record has lost it, leaked it, erased it, shared it with the wrong people, and gone a year without anyone confirmed to run it.

Kept here for my own history, so that the next time a client says “remember when the IRS…” I have the date and the source.

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One entry per event, with what the inspector general, the courts or the agency itself said about it, and a source on each. The targeting affair of 2010–2018 has its own page; it appears here only as headlines. The column that started this collection — Peggy Noonan’s “Damage Control at Fortress IRS,” Wall Street Journal, July 26, 2013, calling the 2010–2013 run “the biggest IRS scandal since Watergate” — is in the file. Facts here are from the sources linked; characterizations are the sources’, not mine, except where marked.

On this page

  1. 2010–2013 Targeting, Anaheim, the travel
  2. 2014–2016 Lost emails, bonuses, Get Transcript, Microsoft, impeachment
  3. 2017–2020 Settlements, the Trump returns, the Taxpayer First Act, the pandemic
  4. 2021–2023 30 million destroyed returns, the Littlejohn leak, Comey and McCabe, the ERC, the whistleblowers
  5. 2024–2026 Littlejohn sentenced, Direct File, DOGE, ICE, five commissioners in a year
  6. What the pattern looks like Marked as my view

2010–2013

2010–2013 — The targeting affair
Applications from groups with “Tea Party,” “Patriot” and “9/12” in their names are flagged and held for extra review from early 2010; 160 of 298 are still open in December 2012; Lois Lerner discloses it May 10, 2013; TIGTA reports May 14; the acting commissioner resigns May 15. Full page.Source: TIGTA 2013-10-053
August 2, 2012 — $5.2 billion in undetected identity-theft refunds
TIGTA finds the IRS failed to catch about 1.5 million returns with potentially fraudulent identity-theft refunds totaling more than $5.2 billion for processing year 2011, on top of 938,664 it did catch, and projects $21 billion over five years without changes. This is the year the IP PIN program begins to matter.Source: TIGTA release
2012 — The NOM donor list
The National Organization for Marriage’s confidential 2008 Schedule B is obtained from the IRS by a requester and published. The IRS settles the suit for $50,000 in June 2014 after the court finds no evidence the disclosure was willful.Source: GovExec, June 2014
June 4, 2013 — The Anaheim conference
TIGTA: about $4.1 million for a 2,609-person Small Business/Self-Employed conference in August 2010, with $135,350 to outside speakers (one painted portraits on stage for $17,000), presidential suites, and more than $50,000 in training videos including the “Star Trek” parody; $49 million on 225 conferences in fiscal 2010–2012.Source: Journal of Accountancy
July 23, 2013 — Executive travel
TIGTA: $4.8 million and $4.7 million of executive travel in fiscal 2011 and 2012; fifteen executives averaged 202 travel days; several lived elsewhere and commuted to Washington at taxpayer expense. A February 2014 follow-up found 9 of 31 sampled executives had treated taxable long-term travel as nontaxable.Source: TIGTA releases
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2014–2016

March–June 2014 — The lost emails
Backup tapes degaussed March 4; the IRS tells Congress June 13 that Lerner’s 2009–2011 emails were lost in a 2011 hard-drive crash; TIGTA’s June 2015 report recovers 1,000-plus emails and finds no intent to destroy evidence. Detail.Source: TIGTA, June 25, 2015
April 22, 2014 — Bonuses to employees with tax problems
TIGTA: $2.8 million in bonuses over two years to about 2,800 employees with recent disciplinary actions, including over $1 million to more than 1,100 employees with their own tax-compliance problems.Source: GovExec
May 7, 2014 — Contempt
The House holds Lerner in contempt, 231–187; DOJ declines to prosecute in March 2015.Source: NPR, April 2015
May 2014–November 2015 — The Microsoft audit and the outside law firm
The IRS pays Quinn Emanuel $2.2 million to help examine Microsoft’s transfer pricing and issues a temporary regulation letting contractors question witnesses under summons; Senator Hatch objects; a federal judge enforces the summonses anyway in November 2015. The Taxpayer First Act of 2019 bars non-government lawyers from questioning summoned witnesses.Source: Hatch letter; Law360
May 26, 2015 — The Get Transcript breach
The IRS announces that criminals using stolen identity data pulled about 100,000 taxpayers’ transcripts through the Get Transcript application between February and mid-May. The count is revised to 334,000 in August and, after TIGTA’s review, to about 724,000 accounts accessed and 295,000 more attempted, in February 2016.Source: IRS statement; Journal of Accountancy
August 5, 2015 — Senate Finance report
The bipartisan report finds management failure from 2010 to 2013 and that the IRS’s loss of records “delayed the Committee’s investigation by more than a year”; the chairman and ranking member split on political motive.Source: Senate Finance Committee
October 23, 2015 — DOJ closes the targeting investigation
“Substantial evidence of mismanagement, poor judgment and institutional inertia”; “poor management is not a crime”; no charges.Source: DOJ letter, via Tax Girl
December 6, 2016 — The Koskinen impeachment ends
The House votes 342–72 to send the impeachment resolution to committee, where it dies; Koskinen serves to November 2017.Source: Tax Girl
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2017–2020

September 28, 2017 — The other watch lists
TIGTA finds the screening ran in both directions over 2004–2013: “Progressive,” “ACORN Successors,” “Occupy,” “Medical Marijuana” and others; 83 cases confirmed selected on them.Source: TIGTA 2017-10-054
October 2017–August 2018 — The settlements
Consent order and apology in Linchpins of Liberty; a reported $3.5 million class settlement in NorCal Tea Party Patriots with no admission of liability, approved August 8, 2018; an apology in Z Street; a bad-faith finding in True the Vote.Source: DOJ Z Street release
April 3, 2019–December 30, 2022 — The Trump returns
Ways and Means requests six years of President Trump’s returns under §6103(f); Treasury refuses; the Office of Legal Counsel reverses in 2021; the D.C. Circuit sides with the committee in August 2022; the Supreme Court denies a stay November 22, 2022; the committee releases the returns December 30, 2022 with a report that the IRS opened only one mandatory presidential audit during the term and finished none.Source: ABA Journal; Roll Call
July 1, 2019 — The Taxpayer First Act
The reorganization law: an Independent Office of Appeals, customer-service and IT mandates, the limit on outside counsel in summonses, and — for our clients — mandatory e-filing for exempt organizations.Source: general
2020 — The pandemic shutdown
Processing centers close in the spring; millions of pieces of mail pile up unopened in trailers; the agency is simultaneously told to send three rounds of Economic Impact Payments. The backlog this created is the 2021–2022 story.Source: National Taxpayer Advocate, Jan. 2022
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2021–2023

March 2021 — 30 million information returns destroyed
The IRS shreds about 30 million unprocessed paper 1099-series returns at Ogden because its scanning system could not clear the prior-year backlog before the next season. TIGTA notes it in September 2021 and details it in May 2022; the IRS says the forms were about 1% of 3.2 billion information returns and no taxpayer was penalized. Every preparer who ever had a CP2000 for a 1099 the IRS “didn’t have” remembers this one.Source: Journal of Accountancy
June 8, 2021 — “The Secret IRS Files”
ProPublica begins publishing nearly fifty articles from the tax data of the wealthiest Americans. The source is not known until 2023 (below).Source: DOJ, Jan. 2024
January 12, 2022 — “Paper is the IRS’s Kryptonite”
The National Taxpayer Advocate’s annual report calls 2021 “the most challenging year taxpayers and tax professionals have ever experienced”: at year-end about 6 million unprocessed 1040s, 2.3 million 1040-Xs, more than 2 million employment returns and 5 million pieces of correspondence; 282 million calls, 11% answered.Source: IRS newsroom
July–December 2022 — Comey and McCabe
The New York Times reports that the former FBI director and deputy director were both selected for the rare, intensive National Research Program audit; Commissioner Rettig refers it to TIGTA, which concludes December 1 that the selections were random and the programs “worked as designed.”Source: Federal Times
May–July 2023 — The Hunter Biden whistleblowers
IRS Criminal Investigation supervisor Gary Shapley and agent Joseph Ziegler tell Ways and Means that the Justice Department slow-walked the Hunter Biden tax case and that they were removed from it; the committee releases their transcripts June 22; both testify publicly in July. A special counsel is named in August; Hunter Biden is indicted on tax charges in December 2023, pleads guilty in September 2024 and is pardoned in December 2024; the Office of Special Counsel later substantiates the agents’ retaliation claims (verify).Source: Roll Call
September 14, 2023 — The ERC moratorium
The IRS stops processing new Employee Retention Credit claims (IR-2023-169) after a flood of ineligible claims pushed by promoters: about 3.6 million claims received, 637,000 unprocessed, processing stretched from 90 to 180 days, followed by withdrawal and voluntary-disclosure programs. The office’s own ERC calls that year were half promoters’ victims.Source: EY
October 12, 2023 — Charles Littlejohn pleads guilty
An IRS contractor (through Booz Allen Hamilton) admits to the unauthorized disclosure of tax returns: from August to October 2019 he exfiltrated President Trump’s returns and gave them to the New York Times, and in 2020 he took the data of thousands of the wealthiest taxpayers and gave it to ProPublica, then destroyed evidence.Source: DOJ
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2024–2026

January 29, 2024 — Five years
Judge Ana Reyes sentences Littlejohn to the five-year statutory maximum. On January 29, 2026, exactly two years later, Trump, his sons and the Trump Organization sue the IRS and Treasury for $10 billion over the leak, alleging a failure to screen and monitor contractors.Source: DOJ; AP / NPR
2024–November 2025 — Direct File, born and ended
The IRS’s own free filing tool takes 140,803 returns in a twelve-state pilot in 2024 and 296,531 in 25 states in 2025 — under half a percent of returns, at a Treasury-reported cost of at least $41 million, about $138 per return. Treasury confirms November 5, 2025 that it will not be offered for 2026.Source: Accounting Today
January 20–April 18, 2025 — Four commissioners in ninety days
Commissioner Werfel resigns on Inauguration Day; Deputy Commissioner O’Donnell retires February 28; Melanie Krause resigns April 8 over the ICE agreement; Gary Shapley is named acting commissioner April 15 and replaced three days later by Deputy Treasury Secretary Faulkender after a Musk–Bessent dispute.Source: Forbes; Bloomberg Law
February–April 2025 — DOGE at the IRS
A DOGE engineer seeks access to the Integrated Data Retrieval System; Treasury limits him to read-only anonymized data (February 20); April reports describe a “hackathon” to build a single API over IRS data with Palantir. About 7,315 probationary employees get termination notices in February and March, most later reinstated by court order or taken by deferred resignation.Source: Washington Post / ADN; TechCrunch; TIGTA 2025-IE-R027
April 7, 2025–September 8, 2026 — The ICE data-sharing agreement
Treasury and DHS sign a memorandum letting ICE request taxpayer information under §6103(i)(2) for people under removal orders; ICE asks for about 1.28 million records; the IRS turns over more than 47,000 under a new procedure that accepted a ZIP code in place of an address. Judge Kollar-Kotelly enjoins it in November 2025, finds about 42,695 violations of §6103 in February 2026, and the D.C. Circuit unanimously affirms September 8, 2026: the IRS is “on notice twice over.”Source: CPA Practice Advisor, Sept. 9, 2026
June 12–August 8, 2025 — Billy Long
Former Rep. Billy Long is confirmed 53–44 amid questions about his promotion of ERC claims and “tribal tax credits,” and is removed by the President after fifty-seven days; Treasury Secretary Bessent becomes acting commissioner while remaining Secretary.Source: Roll Call; CNN
July 18, 2025 — A quarter of the workforce
TIGTA: 25,386 employees, about 25% of the agency, separated or accepted deferred-resignation offers by May 2025; revenue agents down about 26%; 48 senior IT employees placed on leave in March. A later report puts the first-year reduction near 30%, with IT staff down 42%.Source: TIGTA 2025-IE-R027; FedScoop
October 6–8, 2025 — A “CEO,” and a furlough
Social Security Commissioner Frank Bisignano is named IRS “chief executive officer,” a title no statute creates, reporting to Bessent; two days later, in the government shutdown, the IRS furloughs nearly 35,000 employees, about half its staff. In March 2026 senators say Bessent’s Vacancies Act window as acting commissioner expired March 6 with no nominee; Treasury answers that Bisignano runs the agency day to day.Source: UPI; CNBC; Senate Finance minority
February–September 2026 — The 2026 filing season
TIGTA’s interim report: inventories up from 1.9 million to 2.4 million by the end of February, paper-return programming not finished until mid-February, 72% of the amended-return inventory overaged. In September TIGTA rates the IRS cybersecurity program “not effective” for the year.Source: FedScoop; Journal of Accountancy
October 2026 — Where it stands
No Senate-confirmed Commissioner of Internal Revenue; Bisignano as “CEO” under the Treasury Secretary; no nominee identified in the sources reviewed through September 2026 (verify).Source: Forbes, March 2026
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What the pattern looks like

My view, marked as such. Three kinds of failure recur, and they are different. The first is judgment at the top — the targeting criteria, the planted question, the Anaheim conference, a CEO title with no statute behind it. The second is custody of the record — the hard drive, the tapes, the Get Transcript breach, the contractor who walked out with the President’s returns, 47,000 addresses handed to ICE on a ZIP code. The third is capacity — 30 million returns shredded because a scanner could not keep up, 282 million calls with 11% answered, a quarter of the workforce gone in five months. The public conflates them, and the politics of each decade decides which one gets the hearing. For the office the lesson is the same every time: keep our own copies of everything, never assume the IRS has what it should have, and tell clients the truth about which of these actually affects them — which is mostly the third.

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Private reference. Compiled October 26, 2026 from the sources linked on each entry; the 2025–2026 entries rest on news coverage and congressional releases and should be re-checked as the record settles. Items marked (verify) were not independently confirmed. Opinions are marked as mine.