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Your Favorite Bureaucracy Goes Digital

Privacy experts reel as the IRS rolls out a pilot program to transmit tax information via e-mail.

This story appears in the April 2000 issue of Entrepreneur. Subscribe »

The is getting set to join the wired world. The tax agencyrecently proposed a pilot program that would make it possible forit to use secure e-mail to deliver tax returns totaxpayer-designated third parties who want to verify ataxpayer's income.

Authorized third parties include tax practitioners,small-business lenders, universities, mortgage companies and otherfinancial institutions that seek income verification for loans,grants or subsidies. While the proposal promises to providetaxpayers with faster and more efficient service, privacy expertsare alarmed at the prospect that it could lead to the misuse ofsensitive tax information.

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