Privacy Impact Assessment – Payer Master File (PMF)
PMF System Overview
The Payer Master File (PMF) Processing System maintains documents covering five tax years of information for all 1096 Forms and all W-3 Forms on a Virtual Storage Access Method (VSAM) database. Data is accessed using the PMF maintained Customer Information Control System (CICS) command code “PMFOL” (Payer Master File On-line). This database, the primary source for a yearly civil penalty project, is used to determine which payers failed to file the Information Returns Processing (IRP) data in a timely manner and on correct media. These are combined with invalid or missing payee Taxpayer Identification Number (TIN) conditions identified by the Information Returns Processing Validation & Perfection (IRP VAL) into a Civil Penalty notice addressed to the payer/filer of the information returns.
System of Records Number(s)
Treasury/IRS 24.030 CADE Individual Master File
Treasury/IRS 24.046 CADE Business Master File
Treasury/IRS 34.037 IRS Audit Trail and Security Records System
Data in the System
1. Describe the information (data elements and fields) available in the system in the following categories:
A. Taxpayer
B. Employee
C. Audit Trail Information (including employee log-in info)
D. Other (Describe)
Taxpayer: Taxpayer data and related information is posted to the Payer Master File (PMF). This data includes Taxpayer Identification Number (TIN), name and address.
Employee: None.
Audit Trail information: Master files by definition do not have an audit trail. They are defined as having interfaces to systems that maintain their own audit trails. There is no direct access to PMF data. All access is through batch files. The data viewed by authorized IRS employees is a copy of the PMF data loaded into any of a number of other systems that have a user interface. These systems maintain the authentication and authorization required, including the use of audit trail information.
Other: None.
2. Describe/identify which data elements are obtained from files, databases, individuals, or any other sources.
A. IRS
B. Taxpayer
C. Employee
D. Other Federal Agencies (List agency)
E. State and Local Agencies (List agency)
F. Other third party sources (Describe)
IRS: None.
Taxpayer: Taxpayer data such as TIN, name and address are obtained from Forms 1096 and W-3.
Employee: None.
Other Federal Agencies: None.
State and Local Agencies: None.
Other third party sources: None.
3. Is each data item required for the business purpose of the system? Explain.
Yes. The TIN, name and address are required to identify the taxpayer’s account. After the initial filing of the tax return, any changes or updates (adjustments) to an account, whether initiated by the taxpayer or the IRS, is submitted as a transaction to post to the master file so that the file reflects a continuously updated and current record of each taxpayer’s account.
4. How will each data item be verified for accuracy, timeliness, and completeness?
PMF completes validation on inputs as detailed below, using common IRS programs and proprietary code. If an error is detected, the record is sent to manual validation:
-TIN is valid (common program outside the bounds of PMF)
-Name Control is valid/numeric (common program outside the bounds of the PMF)
-Tax Period is valid/numeric (common program)
-Document code (common program outside the bounds of the PMF).
5. Is there another source for the data? Explain how that source is or is not used. No.
6. Generally, how will data be retrieved by the user?
PMF data is extracted on a weekly basis for reports and for loading into other IRS systems, which provide read-only access to the data (on a need to know basis).
7. Is the data retrievable by a personal identifier such as name, SSN, or other unique identifier?
Yes. The data is retrievable by TIN.
Access to the Data
8. Who will have access to the data in the system (Users, Managers, System Administrators, Developers, Others)?
PMF-related duties are separate and disbursed among various IRS organizations. PMF developers create/test/debug application code and maintain the PMF production data. PMF programmers are only given access rights necessary to complete the tasks associated with their job. User access is dictated by local/national oversight, which is beyond the boundaries of the PMF application. Only PMF programs in the production environment have data altering functionality, users are, by definition, granted only limited privileges (read data access only). Developers must submit an OL5081 form for RACF access and have the proper authorization.
Note: RACF is the Resource Allocation Control Facility, which is a security package protecting the mainframe. See IRM 3.1.50.2.6.
9. How is access to the data by a user determined and by whom?
Only PMF programs in the production environment have data altering functionality. Users are, by definition, granted only limited privileges (read data access only) through the OL5081 process.
10. Do other IRS systems provide, receive, or share data in the system? If YES, list the system(s) and describe which data is shared. If NO, continue to Question 12.
Yes. Inputs can originate in any number of IRS processing systems. Generally these systems interface with the Integrated Data Retrieval System (IDRS)/ Integrated Case Processing (ICP) system processing runs which include End-of-Day (EOD) runs which validate the data before submitting to the PMF for posting. Posted data is replicated for use in other IRS processing systems. The entire PMF is replicated for Payer Master File On-line (PMFOL), which provides on-line read-only access for authorized IRS users.
Application Receives Data from:
Automated Extensions (AWAX - EAWPMF)
Backup Withholding (BWH)
Business Master File Outputs (BMF OUTPUTS)
Business Master File Posting and Analysis (BMF ANALYSIS)
Combined Annual Wage Reporting (CAWR)
Enterprise Data Warehouse Individual Filers Model (EDW IFM)
IRP Civil Penalty (IRP CIV PEN)
Incorrect Information Penalty (IRP IIP)
Individual Master File Outputs (IMF OUTPUTS)
Individual Master File Posting & Analysis (IMF ANALYSIS)
Information Returns Processing Validation & Perfection (IRP VAL)
Application Provides Data to:
Backup Withholding (BWH)
Business Master File Posting and Analysis (BMF ANALYSIS)
Business Master File Pre-Posting (BMF PRE-POSTING)
Business Operating Division Notice Count Database (BOD DB)
Combined Annual Wage Reporting (CAWR)
Disclosure of Information to Federal State and Local Agencies (DIFSLA)
Electronic Tax Administration Marketing Database (ETA MDB)
Enterprise Data Warehouse Business Filers Model (EDW BFM)
Enterprise Data Warehouse Individual Filers Model (EDW IFM)
Generalized Unpostable Framework (GUF)
IRP Civil Penalty (IRP CIV PEN)
IRS Internal (IRS INT) (External Trading Partner)
Incorrect Information Penalty (IRP IIP)
Individual Master File Posting & Analysis (IMF ANALYSIS)
Individual Master File Pre-Posting (IMF PRE-POSTING, IMF INPUTS)
Information Returns Master File Processing (IRMF)
Information Returns Processing Underreporter Backup Withholding (IRP UBWH)
Mail Labels Processing (MAIL LABELS)
Payers (PAYERS) (External Trading Partner)
State-Levy Processing (STATE-LEVY)
11. Have the IRS systems described in Item 10 received an approved Security Certification and Privacy Impact Assessment? Yes.
12. Will other agencies provide, receive, or share data in any form with this system? Yes.
Administrative Controls of Data
13. What are the procedures for eliminating the data at the end of the retention period?
The files are deleted after a research period of one year.
14. Will this system use technology in a new way? If "YES" describe. If "NO" go to Question 15. No.
15. Will this system be used to identify or locate individuals or groups? If so, describe the business purpose for this capability.
Yes. The business purpose is to store accounts of return filers and identify and locate taxpayers who are not in compliance with federal tax filing and payment requirements. The system accepts queries from other systems based on criteria that may indicate cases at high risk for non-compliance. The data are further analyzed by these other systems, and the results posted back to the payer master file.
16. Will this system provide the capability to monitor individuals or groups? If yes, describe the business purpose for this capability and the controls established to prevent unauthorized monitoring.
Yes. This system does not itself monitor individuals or groups. Other systems extract data from this repository. Extracts are performed only based on an approved request for information services.
17. Can use of the system allow IRS to treat taxpayers, employees, or others, differently? Explain.
No. The master file data allows IRS to ensure that taxpayers are treated equitably. The automated method of generating notices based on specific criteria eliminates the possibility of one taxpayer receiving preferential treatment over another or one taxpayer unfairly singled out for special scrutiny.
18. Does the system ensure "due process" by allowing affected parties to respond to any negative determination, prior to final action?
Yes. The PMF records the issuance of statutory notices. These notices may include math errors on a return, and other procedural notices sent to the taxpayer on initial processing. If another system accesses data in the PMF and subsequent processing by that other system results in a notice to the taxpayer, the notice is recorded on the PMF, which serves as the master repository. The other systems have procedures to ensure due process.
19. If the system is web-based, does it use persistent cookies or other tracking devices to identify web visitors?
PMF is not web-based and therefore does not use persistent cookies or other tracking devices to identify web visitors.
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