Privacy Impact Assessment - Form 8898 (Statement for Individuals who Begin or End Bonafide Residence in the US Possessions) Database
Form 8898 System Overview
The American Jobs Creation Act (AJCA) created a requirement for US taxpayers to report changes in residence to or from a US Possession. These provisions are aimed at addressing a tax avoidance scheme whereby taxpayers claim residency in a US Possession when in fact they have not established a bona fide residence. Form 8898 was developed for the purpose of making the necessary declaration of a change in residence. The proposed database will capture all Forms 8898 filed with the IRS. The information in the database will be matched against established databases in an attempt to identify nonfilers.
System of Records Number(s)
Treasury/IRS 34.037 IRS Audit Trail and Security Records System
Treasury/IRS 42.021, Compliance Programs and Project Files
Treasury/IRS 49.007 Overseas Compliance Project System
Treasury/IRS 49.001 Collateral and Information Requests 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)
1 A. Taxpayer
Information collected will be from Form 8898, “Statement for Individuals Who Begin or End Bona Fide Residence in a US Possession” that are received in the campus. These forms will be forwarded to Compliance Services to input into a database. Taxpayer information that will be captured include the taxpayer’s name, social security number, current address, and address in possession. Part 1 and II of Form 8898 will also be captured. Part I includes general information on if the taxpayer became or ceased to be a bonafide resident of the US Possession, the tax year, which Possession and the average worldwide gross income for the three year period prior to the tax year. Part II captures information on the presence in the US or Possession which includes the date you moved, the number of days in the US and Possession and if the taxpayer has a permanent connection to the US during the tax year.
1 B. Employee
Access is set up to capture the SEID of anyone accessing the database.
1 C. Audit Trail
Access to the database on the server is on an approved basis and the audit trails will capture all access to the system. The audit trail will record information as follows:
1) When the event occurred.
2) The user (SEID) initiating the event.
3) Any update or revision to a record.
4) Records new record loaded.
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)
The data elements identified in item 1 above will be obtained directly from taxpayers who will provide this information on Form 8898 filed at the Philadelphia Campus.
3. Is each data item required for the business purpose of the system? Explain.
Yes. The Form 8898 is not transcribed to Master File. Therefore, input of the data is necessary to facilitate data matches to identify potential abuse.
4. How will each data item be verified for accuracy, timeliness, and completeness?
The information comes directly from the taxpayer and is therefore deemed to be accurate, timely, and complete.
5. Is there another source for the data? Explain how that source is or is not used.
No, there is no other source for the data.
6. Generally, how will data be retrieved by the user?
Users will query the database to research and pull data to match against US Possessions data.
7. Is the data retrievable by a personal identifier such as name, SSN, or other unique identifier?
Yes, name and SSN or TIN are required data elements.
Access to the Data
8. Who will have access to the data in the system (Users, Managers, System Administrators, Developers, Others)?
Philadelphia Campus will be responsible for data input with management oversight by Compliance Services. Research will use data to analyze and identify compliance issues. The shared server will have controlled access.
9. How is access to the data by a user determined and by whom?
Database will be on a shared server with controlled access. Access will be approved by Philadelphia Compliance Services. Windows NT authentication controls access to the application.
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. NO
11. Have the IRS systems described in Item 10 received an approved Security Certification and Privacy Impact Assessment? N/A
12. Will other agencies provide, receive, or share data in any form with this system? NO
Administrative Controls of Data
13. What are the procedures for eliminating the data at the end of the retention period?
Both electronic and paper documents will be retained and eliminated as required in IRM 1(15)23-1(42), Records Control Schedule for Tax Administration-Exam.
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.
Not literally. This system will be used to identify individuals who have filed Form 8898. That information will be analyzed to determine and identify potential tax abuse and to match with other databases to identify potential nonfilers.
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. NO
17. Can use of the system allow IRS to treat taxpayers, employees, or others, differently? Explain. NO
18. Does the system ensure "due process" by allowing affected parties to respond to any negative determination, prior to final action?
No action will be taken directly as a result of this system. Potential nonfilers and under reporters will receive normal treatment through Examination and Collection processes.
19. If the system is web-based, does it use persistent cookies or other tracking devices to identify web visitors?
This system is not web-based.
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