Shifts by the Internal Revenue Service from a focus on taxpayer service to enforcement, and of the management of the Business Systems Modernization program from contractors to staff entail risks, according to the Government Accountability Office.

In its assessment of the IRS 2006 budget request, the GAO noted that the IRS budget requested for 2006 includes an 8 percent increase for enforcement and a 1 percent decrease and a 2 percent decrease for taxpayer service and BSM, respectively. 

"The IRS has not finalized the details on where reductions in taxpayer service would occur," said the GAO.  "The risk, as the IRS shifts its priorities towards enforcement, is that some of the gains in the quality of taxpayer service could be surrendered. There are analogous risks associated with moving more of the management of BSM in-house." 

However, the GAO said, "The IRS's recent gains in enforcement staffing are encouraging, as tax law enforcement continues to remain an area of high risk for the federal government because the resources the IRS has dedicated to enforcing the tax laws have declined, while the IRS's enforcement workload -- measured by the number of taxpayer returns filed -- has continually increased."

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