The Internal Revenue Service needs to improve its processes for disposing of unneeded computers, printers and servers, according to a new government report.

The report, from the Treasury Inspector General for Tax Administration, reviewed the accuracy of the disposal asset inventory and the IRS’s actions taken or planned to fulfill General Services Administration requirements.

The new report comes amid controversy over the IRS’s email retention policies, as congressional investigators into the Tea Party targeting scandals have found that nearly two years’ worth of emails between Lois Lerner, the former director of the IRS’s Exempt Organizations unit, and people outside the agency are missing from IRS backups after her computer crashed in 2011 (see IRS Lost 2 Years of Lois Lerner’s Emails with Outsiders). Emails are also missing from six other IRS officials who are part of the probe, including the chief of staff for former IRS commissioner Steven T. Miller (see Congressional Republicans Say IRS Lost Emails from 7 Officials).

TIGTA’s reports have uncovered a number of problems over the years with the IRS’s technology security and computer systems, but the agency has been making improvements.

In the latest report, TIGTA found that while the IRS is complying with requirements from the U.S. General Services Administration to recycle or donate used information technology equipment, TIGTA found several areas for improvement. According to the report, the IRS needs to: improve documentation to ensure compliance with media sanitization guidelines; report any IT equipment that cannot be located to the Computer Security Incident Response Center as required; and improve documentation of disposal actions.

The IRS disposed of 63,031 desktop computers and 44,734 laptops between 2009 and 2012 through a combination of recycling and donating to schools. However, it does not effectively track which equipment is recycled or donated, making it difficult to measure compliance with GSA requirements.

TIGTA made eight recommendations to improve documentation of the removal of all data from IT equipment before it is donated and the equipment’s final destination, and the reporting of lost or stolen equipment.  The IRS agreed with TIGTA’s recommendations and is taking actions to implement them.

“The IRS has implemented an effective asset disposal process and we believe the recommendations in the audit will simply serve to enhance the documentation artifacts associated with that process,” wrote IRS chief technology officer Terence V. Milholland in response to the report.

However, he cautioned that the IRS’s corrective actions would be “contingent upon funding availability.” The agency has been challenged by a series of budget cuts in recent years. While the Obama administration has requested a budget increase for the IRS for the next fiscal year, the House Financial Services and General Government Appropriations Subcommittee instead proposed a further reduction in the IRS’s budget for fiscal 2015. At a markup of budget appropriations legislation Wednesday, the subcommittee proposed to reduce the IRS’s funding by $341 million below the current levels, or $1.15 billion less than the White House’s request, putting the IRS funding back to the level it received in 2008.

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