IRS aims to take its service to new heights, crack down on high-income tax evaders, and revolutionize its technology infrastructure. In Filing Season 2023, the Internal Revenue Service (IRS) witnessed remarkable improvements in service, thanks to the resources allocated by the Inflation Reduction Act.
The IRS surpassed Secretary of the Treasury Janet L. Yellen’s goal of achieving an 85% Level of Service, reaching an impressive 87%. Notably, the agency answered 3 million more calls, reduced phone wait times to three minutes from 28 minutes, served 140,000 additional taxpayers in person, digitized 80 times more returns compared to 2022 using new scanning technology, cleared the backlog of unprocessed 2022 individual tax returns with zero errors, introduced two new digital tools, and implemented a new direct-deposit refund option for taxpayers with amended returns.
Building upon this success, the IRS is now focused on further enhancing its services, strengthening enforcement against high-income individuals who evade taxes, and modernizing its core technology infrastructure to provide improved service and data security.
Improving Taxpayer Service
The IRS aims to assist taxpayers in getting their tax filings right the first time, ensuring they claim the credits and deductions they are eligible for and minimizing back-and-forth interactions with the agency due to errors. To achieve this, the IRS is expanding its in-person services, particularly targeting underserved and rural communities. Additionally, the agency is establishing Community Assistance Visits, setting up temporary Taxpayer Assistance Centers to facilitate face-to-face interactions with taxpayers from hard-to-reach areas. Several Taxpayer Assistance Centers have already been opened or reopened in various locations across the country.
The IRS is also working towards enabling taxpayers to seamlessly interact with the agency through multiple channels, including phone, in-person, and online. It plans to enhance individual taxpayer accounts with secure messaging, live chat, and virtual assistance features. Tax professionals will have access to enhanced capabilities in their online accounts, including account authorization management and live chat. Business owners will benefit from the launch of the Business Online Account, which allows them to view outstanding balances, make payments online, and perform business tax checks.
Moreover, the IRS is committed to improving the accessibility and usability of IRS.gov, ensuring taxpayers can easily find relevant information and access necessary services. These improvements include updates to the homepage, enhancements to filing season content, and more intuitive global site navigation.
Ensuring Tax Evaders Pay Taxes Owed
Addressing the issue of high-income individuals evading their tax obligations, the IRS is taking swift and aggressive action. In recent months, IRS Criminal Investigation has successfully closed numerous cases involving wealthy taxpayers convicted of tax evasion, money laundering, and filing false tax returns. These individuals opted to spend owed tax funds on lavish expenses like gambling, vacations, and luxury goods.
The IRS is also focusing on delinquent millionaires, resolving around 175 cases and generating $38 million in recoveries. This pursuit of millionaires who fail to fulfill their tax obligations will be intensified through the enforcement capabilities provided by the Inflation Reduction Act. Notably, the IRS has identified cases where high-income individuals are fraudulently claiming benefits in Puerto Rico to evade U.S. taxes, as well as cases involving the improper use of pension arrangements in Malta to avoid U.S. taxes. These schemes are being addressed, with the IRS anticipating many of them proceeding to a criminal investigation. Additionally, efforts are being intensified to crack down on millionaire non-filers who indulge in extravagant purchases instead of fulfilling their tax responsibilities.
Modernizing Technology
Recognizing the importance of modern technology, the IRS is working on upgrading its decades-old infrastructure to provide world-class customer service and safeguard taxpayer data. This includes replacing mail-sorting machines to expedite the processing of paper returns and refunds. The IRS plans to install new machines in locations such as Kansas City, Ogden, and Austin. Furthermore, the agency aims to enhance its scanning capabilities by replacing outdated scanners with 205 advanced models, enabling quicker processing of incoming paper.
The IRS is also making significant progress in digitization efforts. By scanning and e-filing paper returns, the agency has streamlined its operations. Notably, a mobile application prototype called Inform Me is being tested, which allows taxpayers to scan paper IRS forms, notices, and documents. The app recognizes the document and provides related information and guidance from IRS.gov, assisting taxpayers in finding answers to their queries. Following user testing with IRS industry partners and at the Nationwide Tax Forums, the app will be deployed to taxpayers.
The IRS’s dedication to improving taxpayer service, pursuing high-income individuals evading taxes, and modernizing technology demonstrate its commitment to an efficient and secure income tax system. With the successful Filing Season 2023 as a foundation, the IRS is poised to provide even better services and ensure compliance for all taxpayers.
