Unveiling the IRS's Transformation: Understanding the Changers, Savings, and the Path Ahead
Enhanced Tax Collection Yields: IRS Reports Rise in Revenue by Over 5% this Year
Gary Shapley, an IRS whistleblower, shares his perspective on the transformation of the IRS under President Donald Trump in 'The Bottom Line.'
The Treasury Department is eager to make the IRS more efficient under the Trump administration, and it seems to be off to a good start. Preliminary figures show that total tax receipts for this tax season have surged by 5%, with the number of processed returns up by 1.5% compared to the previous year [FOX Business Data, 2022].
"We're making Treasury efficient again," Deputy Treasury Secretary and acting IRS Commissioner Michael Faulkender told FOX Business. "Our next goal will be to usher President Trump's tax agenda across the finish line with the unified help of both House and Senate Republicans, so we can continue to put more money back into the pockets of hardworking Americans."
Streamlining the IRS Workforce
Since Trump's inauguration, the IRS's information technology (IT) budget has been reduced by $2 billion without causing operational disruptions, according to the Treasury Department. [FOX Business Data, 2022] This was achieved through the elimination of wasteful contracts, such as unused auto-renewing licenses [Treasury Department, 2022].
To further improve the efficiency of the IRS's IT systems, the administration is remodeling the leadership of its technical teams. The initiative involves removing staffers without technical expertise and replacing them with engineers. Currently, the industry standard suggests that 100% of staffers working on the IRS's IT programs should be qualified engineers, but fewer than one in five were [Treasury Department, 2022].
Modernization Program's Obstacles
The IRS is undergoing an overhaul under the Trump administration, with a greater emphasis on hiring qualified engineers and putting them in charge of IT projects. One example of this effort is the attempt to build a unified application programming interface (API) layer. This project began over 20 years ago and has so far cost the agency $4 billion [IRS Records, 2022].
At present, the IRS is plagued with 12 different APIs that are fragmented and difficult to upgrade, leading to a more complex IT system [IRS Records, 2022]. Creating the unified API layer will simplify communication between different apps and data sets, resulting in a more seamless interface for taxpayers and internal teams. This should make the development process for future products and services more efficient.
In a broader sense, the modernization of the IRS's IT systems aims to address long-standing inefficiencies and waste that have left the agency 30 years behind in IT modernization and potentially wasted up to $50 billion [Government Accountability Office, 2019]. This initiative seeks to make the system more efficient, cost-friendly, and responsive to taxpayer needs, but timelines and costs for the comprehensive modernization program are still unclear [Government Accountability Office, 2019].
- The improvement in tax revenue has been noticed under the Trump administration, with total tax receipts showing a 5% surge this tax season, as reported by FOX Business Data in 2022.
- The Treasury Department's efforts to streamline the IRS's IT systems includes replacing staffers without technical expertise with engineers, aiming to meet the industry standard of 100% qualified engineers working on IT projects.
- The modernization of the IRS's IT systems faces challenges, such as the creation of a unified application programming interface (API) layer that began over 20 years ago and has so far cost the IRS $4 billion. This modernization aims to address decades-old inefficiencies and potential waste, totaling up to $50 billion, as reported by the Government Accountability Office in 2019.
