The 1995 Tax Filing Season

This report assesses the Internal Revenue Service's (IRS) performance during the 1995 tax filing season. Although IRS indicators show that the agency met many of the 1995 filing season goals, these indicators do not provide a complete assessment of the filing season. Several problems are not obvious from these indicators: (1) IRS' efforts to combat fraud generated much adverse publicity that might have been avoided have the agency better forewarned taxpayers of potential refund delays; (2) GAO's tests and IRS data showed that taxpayers continued to have serious problems trying to reach IRS by telephone; and (3) a new document imaging system did not work as well as expected, leading to increased returns processing costs and lower-than-expected productivity.

GAO found that: (1) IRS delayed about 7 million refunds for up to 8 weeks because of systematic checks for questionable refund claims; (2) IRS delayed refunds on returns with missing or invalid social security numbers (SSN) to identify duplicate uses of the same SSN and fraud schemes; (3) IRS could have alleviated negative publicity about the delays had it better forewarned taxpayers about the potential for delays; (4) although IRS answered 11 percent more calls from taxpayers in the 1995 filing season, the chance of reaching an IRS assistor was not very good; (5) various IRS processing and accessibility goals mask problems in its actual performance; and (6) IRS experienced numerous problems with its electronic image computer system, including extensive downtime and slow processing rates.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: Team: Phone: