IRS Uncollected Tax Debts Rise to $380 Billion as Collection Staff Declines
The Internal Revenue Service’s total tax debt inventory has increased 23 percent since 2009 to $380 billion, according to a new government report, while the agency’s collection staff has declined 23 percent after years of budget cuts.
The report, from the Government Accountability Office, found the IRS lacks adequate internal controls over its largely automated tax collection processes. The processes automatically categorize and route unpaid tax or unfiled tax return cases for potential selection. The automated Inventory Delivery System, or IDS, categorizes and routes cases based on many factors, such as type of tax and amount owed.
Outside of IDS, collection managers set goals for closing cases in priority areas, such as delinquent employer payroll taxes and cases involving certain high-wealth taxpayers. If the goals are at risk of not being met, officials are able to take action to select additional priority cases.
In recent fiscal years, the collection program has exceeded nearly all case closure goals for priority cases. However, because the IRS has not identified objectives for the collection program, such as fairness, the GAO said it is difficult to assess the program's overall effectiveness. Read more on Accounting Today.