Twitter feed
– 11 hours ago

Why IRS’ Claims Lois Lerner’s Email Is Lost May Be Totally True, But Also Totally Negligent And/Or Totally Illegal


Via Facebook I have shared a fair amount of coverage of the Lois Lerner email flap the IRS tried to hide in a typical, shady, Friday afternoon document dump.

My initial reaction to claims that the IRS simply lost Lerner’s outbound email was disbelief. There was simply no way the email to IRS employees could be saved and email to third party groups (especially left-leaning groups that were urging investigation of right-leaning groups) could simply vanish.

Further exploration of the subject has actually shifted my thinking. I believe it is actually possible this happened, and if it did, someone at the IRS should be prosecuted for failure to follow federal guidelines for document retention.

So How Did We Get Here?

The story basically comes down to the following four bullet point explanations:

  • IRS employees were allocated 500MB per person for email on IRS servers.
  • IRS employees were instructed to move any email that exceeded this cap onto their personal workstations
  • Personal workstations were not backed up
  • Employees had discretion to decide what was an “official” record and whether or not to keep them.
  • IRS servers were backed up for only six months (or three years, depending on whose account you read)

I have worked for organizations that had similar document retention policies to that spelled out above. There are a number of reasons programs like this are implemented.

Excessively small limits on email made sense 10-15 years ago when storage on servers was expensive. At that time it was also common to limit file attachments to no larger than 5-10 megabytes. IT departments with small budgets were constrained by the cost of larger drives and would often offload excess to workstations in an effort to save space on the mail server. Mail servers also used to get persnickety as capacity shrunk and this helped prevent mail server crashes.

However, in almost every case where I have seen this, the individual workstations were part of a backup routine that would still archive the material. I have never seen an Enterprise environment where users were encouraged to store data locally AND without backup.

That emails were important enough to keep when server capacity was reached indicates that they would have been important enough to have a copy of in the event of data loss. If employees were told to keep important files and correspondence locally and that same important documentation was not protected in some way is malpractice of the first order for IT personnel. Anyone with even a moderate amount of experience would see the potential for data loss and should be guarding against it.

If this is all true, the IT staff at the IRS should be held responsible and anyone there at the time should be fired and possibly the subject of civil action. There is simply no way this should have been allowed to happen.

That said, there is one scenario in which this type of policy is intentional. Organizations who may be the subject of lawsuits and investigation, may implement draconian document retention policies specifically to avoid discovery. Short burn windows for backups, limits on the size of email folders, and workstations that are not part of a backup routine can be specifically used to evade the retention of material that could prove damaging in a lawsuit.

Laws exist for publicly traded companies to prevent this. But many companies and organizations are not subject to that kind of restriction and use that leeway to protect themselves.

The government, however, is not one of those organizations. Due to such things as the missing 18 minutes of audio in the nixon tapes and the shredding of documents in the Iran-Contra affair, the government has enacted legislation that requires official documents to be maintained.

If the IRS was truly allowing its employees leeway in what they kept, then the leadership of the IRS should be held responsible for violations of federal archiving laws. The IRS should immediately be ordered to prevent the deletion of any documents from this day forward.

This is, after all, an agency that has access to the sensitive financial information of every business and individual in the US. If they do not take seriously the sensitive nature of that material, then there is a systemic failure in the organization.

Finally, what is truly ironic about the IRS record retention policy for its own internal documents is how much they conflict with the IRS directions to taxpayers for retention of taxpayer information:

The length of time you should keep a document depends on the action, expense, or event the document records. Generally, you must keep your records that support an item of income or deductions on a tax return until the period of limitations for that return runs out.

The period of limitations is the period of time in which you can amend your tax return to claim a credit or refund, or that the IRS can assess additional tax. The below information contains the periods of limitations that apply to income tax returns. Unless otherwise stated, the years refer to the period after the return was filed. Returns filed before the due date are treated as filed on the due date.

Note: Keep copies of your filed tax returns. They help in preparing future tax returns and making computations if you file an amended return.

  1. You owe additional tax and situations (2), (3), and (4), below, do not apply to you; keep records for 3 years.
  2. You do not report income that you should report, and it is more than 25% of the gross income shown on your return; keep records for 6 years.
  3. You file a fraudulent return; keep records indefinitely.
  4. You do not file a return; keep records indefinitely.
  5. You file a claim for credit or refund* after you file your return; keep records for 3 years from the date you filed your original return or 2 years from the date you paid the tax, whichever is later.
  6. You file a claim for a loss from worthless securities or bad debt deduction; keep records for 7 years.
  7. Keep all employment tax records for at least 4 years after the date that the tax becomes due or is paid, whichever is later.

The following questions should be applied to each record as you decide whether to keep a document or throw it away.

Note the IRS says you need to keep documents for a period from 2 years to “indefinitely”. That is far shorter than their own internal practice of keeping backups for ‘six months or until you’re out of space.’

There is, contrary to my initial beliefs, a world in which the IRS explanation may be 100% true. If it is, however, I do not see a situation where that should not result in further investigation and prosecution of those responsible.

 



Share
Tags
Written by Turk