IRS Management

Taxpayers testified before Congress in 1997 about the difficulties they had had in trying to get help from the Internal Reserve Service (IRS) in resolving ongoing problems. Specifically, concerns were raised about IRS' Office of the National Taxpayer Advocate, which was set up to help taxpayers who (1) have been unable to resolve their problems elsewhere in IRS or (2) are suffering significant hardships. GAO identified shortcomings in the Office and in the Problem Resolution Program that could affect how efficiently and effectively services are provided to taxpayers. For example, the Office lacked control over resources for its Problem Resolution Program. It did not know how many employees were working in the program or the costs associated with that staffing. Some staff said that they lacked the necessary training, and limited advancement opportunities make it difficult for the Office to hire and retain qualified employees. Also, demands on the Office to resolve individual taxpayer problems left little time for staff to identify the causes of recurring taxpayer problems and recommend solutions. The Office is in the midst of improving its operations. Many of these changes, such as restructuring Office operations and creating career paths for local advocates, are outgrowths of the requirements of the IRS Restructuring and Reform Act of 1998. Other changes, such as developing position descriptions for Problems Resolution Program caseworkers, are the result of Office initiatives. It is too soon to tell, however, how effective these changes will be in overcoming the problems GAO cited. Two areas in which changes are being considered are advocacy and performance measures. But changes in both areas require better information systems than are now available.

GAO noted that: (1) there are various management and operational challenges facing IRS, the Advocate's Office, and PRP; (2) how these challenges are addressed could affect how efficiently and effectively taxpayers are helped by PRP; (3) the Advocate's Office faced resource management challenges because it lacked direct control over most PRP resources; (4) planned changes to the Advocate's Office and PRP, such as placing PRP resources under the control of the Advocate's Office, could mitigate some of these issues; (5) however, it is too early to evaluate the impact of these changes; (6) IRS faces challenges as it restructures the Advocate's Office to better handle variations in PRP's workload; (7) according to Advocate Office officials, in the past, because PRP operations depended on IRS functional units for resources, any fluctuations in PRP's workload were handled by adjusting the number of functional staff assigned to work PRP cases; (8) however, the Advocate's Office is moving away from a structure that relies on other IRS units for staffing, which may make it more difficult for the Advocate's Office to handle workload fluctuations, especially workload increases; (9) the Advocate told GAO that he was committed to helping any taxpayer who contacts the office; (10) while it is understandable why the Advocate's Office might not want to turn away anyone seeking help, accepting cases that could be handled elsewhere in IRS could overburden PRP; (11) the demands on the Advocate's Office to resolve individual taxpayer problems has left little time for staff to spend identifying the causes of recurring taxpayer problems and recommending solutions; (12) also, limitations in the kind of information available provided little assurance that the time being spent was being used most effectively; (13) these efforts on recurring problems, called advocacy, are key to the success of the Advocate's Office because the improvements they generate can reduce the number of taxpayers who ultimately require help from PRP; (14) IRS lacked adequate measures of the effectiveness of the Advocate's Office and PRP; (15) measures of effectiveness should cover the full range of Advocate Office operations so they can be used to improve program performance, increase accountability, and support decisionmaking; and (16) the set of measures used by the Advocate's Office during GAO's review focused on descriptive program events instead of program outcomes, did not provide complete data, or were not based on consistent data collection.

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.

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