IRS Tracks Your Digital Footprint via "ROBO-AUDITS"

The agency declined to comment on how it will use its new technology. But agency officials have been outlining plans at industry conferences, working with IBM, EMC and other private-sector specialists. In presentations, officials have said they may use the big data for:

• Charting and analyzing social media such as Facebook.
• Targeting audits by matching tax filings to social media or electronic payments.
• Tracking individual Internet addresses and emailing patterns.
• Sorting data in 32,000 categories of metadata and 1 million unique "attributes."
• Machine learning across "neural" networks.
• Statistical and agent-based modeling.
• Relationship analysis based on Social Security numbers and other personal identifiers.

Officials have said much of the data will be used only for research. The agency's economic forecasts and data are a key part of Washington's budget infrastructure. Former commissioner Douglas Shulman said in an IRS statement that the technology will employ "billions of pieces of data" to target enforcement and to "detect and combat noncompliance."

The IRS last year used a profiling test model to study 1,500 tax preparers with histories of reporting deficiencies and managed to recover $200 million. It cited the experience as proof that its data analysis works.

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