The latest annual report from the National Taxpayer Advocate repeats the conclusion repeated reached by that office and others that funding restrictions of recent years have hampered IRS operations, although adding that agency management also uses the issue as an excuse.
The Advocate, an independent entity, says the agency’s budget has been reduced 20 percent in inflation-adjusted terms since fiscal 2010, which “rendered the IRS unable to provide acceptable levels of taxpayer service, unable to update its technology to improve its efficiency and effectiveness, and unable to maintain compliance programs that both promote compliance and protect taxpayer rights. Shortcuts have become the norm, and shortcuts are incompatible with high-quality tax administration.”
For example, the IRS in 2014 cut back on its telephone services and even with some more recent boost in that program, the IRS projects it will only be able to answer about six out of 10 calls from taxpayers during this filing season and about four out of 10 taxpayer calls during the full fiscal year.
The recent enactment of sweeping changes in tax law will make all those challenges more difficult, it adds.
However, a statement accompanying release of the report also says that the agency “has sometimes been too quick to cite funding constraints as a basis for inaction. Limited resources cannot be used as an all-purpose excuse for mediocrity. There is not a day that goes by inside the agency when someone proposes a good idea only to be told, We don’t have the resources.”
“The IRS environment often does not encourage personal or organizational growth, and stifles creativity, innovation, and quick problem resolution,” the report added.