Nearly one in five nonprofits publish private Social Security numbers on public tax documents, potentially exposing their supporters and employees to identity theft and other privacy breaches, an examination of federal tax forms has found. Identity Finder, a company that specializes in security and privacy software, reviewed more than three million informational tax returns, known as Form 990s, filed from 2001 to 2006 and found that more than 132,000 charities had published at least one Social Security number on their tax forms.
Most of the Social Security numbers the charities revealed were those of donors, trustees, employees, directors, and scholarship recipients. Slightly more than a third of the Social Security numbers were those of the individuals who prepared the documents, the study found.
“Unlike a credit-card number, Social Security numbers cannot easily be revoked,” Todd Feinman, chief executive of Identity Finder, said in a statement. “Given the seriousness and ubiquity of identity fraud, tax preparers should avoid including [Social Security numbers] on Form 990s.”The disclosures have been made by some of the nation’s largest charities. A Chronicle review of the tax forms of the 12 top groups on its Philanthropy 400 ranking of charities that raise the most from private sources found three organizations that published the Social Security numbers of at least one individual: Food for the Poor, Schwab Charitable Fund, and the Task Force for Global Health.
Schwab Charitable released the Social Security numbers of six people, while Food for the Poor and the Task Force for Global Health each included the number of one person.
For the Task Force for Global Health and Food for the Poor, the published numbers were those of the tax preparers, those organizations told the Chronicle. Schwab Charitable’s tax return is handled by the accounting company Deloitte, and the Social Security numbers revealed on their documents are also those of the tax preparers themselves.
“Schwab Charitable has never disclosed any private information for any of its donors, employees, or board members, and in fact protecting privacy is of course of the utmost importance to them,” said Kerstin Osterberg, a spokeswoman. “They take protecting privacy very, very seriously, and it’s something that they’re focused on at all times.”
Liability for Charities
Grayson Barber, an advocate for privacy issues, says charities should exercise extreme care in protecting personal information about employees and supporters, in part because they could be liable if that information gets into the wrong hands.
“Having access to confidential information like Social Security numbers imposes obligations on all corporations, including charitable organizations, to protect sensitive personal information,” Ms. Barber says.
The Internal Revenue Service does not require organizations to include Social Security numbers on the Form 990. Tax preparers are required to provide their personal tax-identification numbers in the form’s signature block, but the instructions state that they should not provide their Social Security numbers in that space.
IRS Urged to Step In
Identity Finder says the IRS should inform nonprofits that Social Security numbers are not to be published on Form 990s. It suggests that the tax agency redact any such numbers on the documents before they are released to the public.
The company also advises nonprofits to warn those whose Social Security numbers have been published that they might be at increased risk for identity fraud.
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