The Government Accountability Office has revealed in a new report that the Internal Revenue Service has not fully updated its strategic operating plan for incorporating funding allocated to the agency through the Inflation Reduction Act to support its information technology modernization efforts.
GAO recommends that the IRS complete an enterprise technology road map addressing its plan’s objectives, complete and update individual plans for its modernization programs and improve its quarterly progress reports to Congress.
The Inflation Reduction Act of 2022 appropriated $79.6 billion to the IRS through fiscal year 2031 to support IT modernization programs across the agency. The funding includes $45.6 billion for tax enforcement activities, $25.3 billion for operations support, roughly $3.2 billion for taxpayer services and another $4.8 billion for business system modernization.
In April 2023, the IRS released an agency-wide strategic operating plan outlining five areas where it will spend the appropriated budget. These include enhancing taxpayer services; resolving taxpayer issues; strengthening enforcement on complex tax filings and high-dollar noncompliance; improving technology, data and analytics; and boosting workforce.
“The IRS intends to use some of these funds to replace legacy IT systems, give taxpayers more online tools and services, and protect taxpayer privacy and security. However, the agency hasn’t fully updated its plans to incorporate these additional funds. For example, the IRS needs to make changes to the scope and milestones of its IT modernization programs,” according to the GAO report.