| " After undergoing its own audit, the government has reported that the IRS lost 490 computers between 2003 and 2006, and is not adequately protecting sensitive taxpayer information. " " last month that the IRS is not only losing hundreds of computers and storage devices, but is failing to encrypt data and is using weak passwords. " " The audit also reported that because of the missing computers, personal information was compromised for at least 2,359 U.S. taxpayers, but the total can't be calculated because records don't list what information was stored on many of the machines. " " "As a result, it is likely that sensitive data for a significant number of taxpayers have been unnecessarily exposed to potential identity theft and/or other fraudulent schemes," said Michael R. Phillips, deputy inspector general, in the report. He added that he believes it is very likely that a large number of the missing computers contain sensitive, unencrypted information. " " The IRS, which has 100,000 employees, annually handles 220 million tax returns, which contain personal financial and identifying information, like addresses and Social Security numbers. The agency has issued 47,000 laptops to employees. " " The report showed that it was unclear what information was on many of the missing computers and if any of it had been encrypted. Phillips, however, said his investigators did their own analysis of 100 laptops currently in use and 44 of them contained unencrypted, sensitive data on taxpayers and agency employees. " " According to the report, 15 of those 44 laptop computers with unencrypted data had security
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