Good news and bad news from the Internal Revenue Service: the good news? The agency is about to begin a long-awaited upgrade program to its antiquated information and taxpayer services systems.
The bad news?
It’ll take six years to do the work.
The previous IRS commissioner had asked for an overhaul, but got no support in Congress at the time.
Called the IRS Integrated Modernization Business Plan, this work is expected to cost between $2.3 billion and $2.7 billion through 2024. Some work is on tap for this year, with the IRS budget carrying $290 million for work in 2020.
“Modernized systems are the key component to delivering quality service to taxpayers, providing efficient and robust enforcement activities and keeping taxpayer data secure,” said IRS Commissioner Chuck Rettig.
“Our modernization plan includes multiple milestones and levels of accountability to ensure it is implemented efficiently and effectively. The integrity of our nation’s tax system depends on modernizing IRS operations and the supporting technical pieces. We look forward to working with Congress to implement this plan.”
In order to drive innovation and support the future of the IRS and its mission, the framers of the upgrade say the plan is built on four basic areas of the agency’s mission, termed “modernization pillars”:
- The taxpayer experience;
- Core taxpayer services and enforcement;
- Modernized IRS operations;
- Cybersecurity and data protection.
“A critical component of the plan involves the IRS’s ongoing efforts to secure our systems and protect taxpayer data,” Rettig said. “The IRS is responsible for safeguarding a vast amount of sensitive financial and personal data involving every taxpayer and business in the nation. This is an area where we cannot fail for the safety of our nation, and modernizing our technology is critical to stay ahead of constant cyber-attacks on our systems.”
The pillars and the plan itself were all reviewed extensively by the IRS, outside experts, stakeholders and tax community partners, Rettig said. The plan, when complete, will allow the IRS to:
- Significantly improve the taxpayer experience by standardizing customer workflows and by expanding access to information.
- Reduce call wait and case resolution times with customer callback technology, online notices, and live online customer support.
- Simplify identity verification to expand access to online services while protecting data.
- Increase systems availability for taxpayers and tax practitioners.
- Make implementation of new tax provisions more straightforward.
The IRS intends to implement the plan in two three-year phases, in order to monitor its progress and adjust investment decisions as part of updating the plan.
A key aspect of the plan should allow the IRS to modernize key systems and stabilize the cost of maintaining the technology ecosystem. This modernization creates opportunities to potentially reinvest savings in order to keep technology current and on pace with evolving taxpayer expectations.
The plan, which will be dependent on future funding, also includes milestones and accountability to ensure it’s implemented efficiently and effectively.