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IRS management agreed to consider alternative methods to forecast revenue. However, IRS management does not plan to use data that is more specific to the initiatives, because it does not believe the investment of time and resources needed to generate refined estimates would be a prudent use of resources. TIGTA does not believe the use of more specific data would require more effort. Report Reference No. 2005-10-159 Security of the IRS Homeland Security Presidential Directive/HSPD-7, Critical Infrastructure Identification, Prioritization, and Protection dated December 17, 2003, established a national policy for Federal agencies to protect critical national infrastructure and key resources from terrorist attacks. HSPD-7 required all Federal agencies to develop plans to protect their critical infrastructure by July 31, 2004. The IRS timely provided the Department of the Treasury a list of 19 critical assets that had been identified in the latter part of 1998, in response to The Policy on Critical Infrastructure Protection: Presidential Decision Directive (PDD-63), dated May 1998. Operational and technical controls for critical systems have not been adequately tested and prioritized. In addition, plans for correcting identified weaknesses are insufficient. TIGTA believes IRS management has been slow to accept responsibility for the security of its systems, and has not devoted sufficient attention to testing and correcting security weaknesses. The Department of the Treasury also required all bureaus to update their lists of critical infrastructure by September 2005. At the time this audit was completed, the IRS was still in the process of performing the analysis necessary to identify its critical assets and expected to have it completed by the deadline. However, because the IRS does not have a process to regularly review its inventory of critical assets, TIGTA recommended that the IRS confirm at least annually the accuracy and completeness of its critical assets list. The IRS agreed with the recommendations and will ensure corrective action is taken. Report Reference No. 2005-20-108 Integrating Performance and Financial Management The IRS has made progress in improving its administration of the Earned Income Tax Credit (EITC) Program. The IRS developed the EITC Reform Initiative to address backlogs of EITC Program examinations, minimize taxpayer burden during the audit process, enhance compliance efforts, and pilot a certification process for higher-risk taxpayers. The IRS also established long-term performance goals and measures to evaluate its progress in improving the Program, and appointed an executive to head the EITC Office. This executive however, faces the difficulty of holding accountable the functions that complete EITC Program work, since most of these functions do not report to the EITC Office. The EITC Office developed Service Level Agreements that document 12 April 1, 2005 to September 30, 2005
and formalize the services being provided by the operating and functional divisions, as well as the support the EITC Office will provide to the respective divisions. TIGTA believes this mechanism will increase the accountability of functions with EITC Program responsibility. The IRS agreed that the EITC Office will regularly evaluate the effectiveness of the Service Level Agreements. Report Reference No. 2005-40-133 The IRS does not have adequate means to evaluate the success of its Low Income Taxpayer Clinic (LITC) Grant Program. In FY 2004, the IRS provided $7.5 million in LITC funds to 134 clinics, yet it has not established performance measures to evaluate the success of the Program and does not visit prospective clinics before awarding grant funds. Information provided by the clinics was inconsistent and not validated. Some clinics did not timely submit required reports. Although clinics are prohibited from charging fees for preparing tax returns, two clinics appeared to be doing so. There were nine clinics that received IRS grants of more than $500,000, but were not in compliance with their own Federal tax obligations. The LITC Grant Program offers assistance to low income taxpayers who are involved in tax controversies with the IRS and provides education about taxpayer rights and responsibilities to taxpayers for whom English is a second language. The following table shows the amount of grant funding for 1999 through 2005: LITC Program Grant Funding, Clinics, and States Represented (1999 – 2005) Year Grant Number States/Territories Funding of Clinics Represented 1999 $1.5 million 34 19 2000 $4.4 million 70 33 2001 $6 million 102 39 2002 $7 million 127 43 2003 $7 million 138 49 2004 $7.5 million 134 51 2005 $8 million 145 51 Source: Internal Revenue Bulletins and News Releases. To improve the LITC Grant Program, TIGTA recommended that the IRS establish program goals and performance measures, and visit prospective clinics before awarding grant funds. In addition, funding should be suspended or terminated for clinics not in compliance with reporting requirements. Finally, the IRS should establish procedures to check for tax compliance before awarding grant funds. IRS management generally agreed with TIGTA’s recommendations. Report Reference No. 2005-10-129 Providing Quality Customer Service Operations The IRS is committed to providing excellent service to taxpayers and enforcing America’s tax laws in a balanced manner. Its first strategic goal is to “improve taxpayer service.” Taxpayers have several options when seeking assistance with tax issues, including face-to-face assistance at Taxpayer Assistance Centers (TAC), tollfree telephone assistance, and Internet assistance through the IRS Web site. The IRS is encouraging taxpayers to use self-services. The IRS believes its April 1, 2005 to September 30, 2005 13
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Page 62 and 63: May 2005 The Innocent Spouse Centra
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"There is nothing sinister in so ar
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"The hardest thing in the world to
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Report of Employee Misconduct for t
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Summary of Substantiated I.R.C. §
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