Governments at all levels are faced with the need to raise more revenue in the wake of the current fiscal crisis. Both the Treasury Inspector General for Tax Administration and the Government Accountability Office have issued reports addressing the weakness in unpaid tax collection, the role of private debt collectors in attempting to collect some of that debt, and the misreporting of rental real estate activities that contribute to the tax gap.The GAO said that while collecting unpaid tax debt is part of any strategy to help ensure compliance and confidence in the tax system and reduce both the annual tax gap and the cumulative unpaid tax debt inventory, Congress and other stakeholders have raised questions about the effectiveness of the Internal Revenue Service collection process in helping ensure compliance.
The report identified material weaknesses in IRS controls over unpaid tax assessments and collections, partly due to the lack of agency-wide cost-benefit data and related performance measures that the GAO recommended in the past.
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