Washington (Jan. 8, 2004) -- Internal Revenue Service Commissioner Mark W. Everson has announced a series of steps, including the cutback of roughly 2,400 employees, to create what the service termed “operational efficiencies” and make room for more enforcement positions to be added in 2005. 

No employee will be laid off before January 2005, according to the IRS.

"These changes reflect our ongoing effort to manage the agency efficiently and effectively for the nation's taxpayers," Everson said. "By tightening operations, we can devote more people to front-line positions and strengthen tax enforcement activities. At the same time, service to taxpayers will not be reduced."

The changes announced involve three areas:

● Closing Memphis tax return processing operations effective in October 2005, following a big increase in e-filing and corresponding drop in paper tax returns.

● Consolidation of back-office processing for exam, collection and insolvency cases from 92 different locations to four starting in 2005.

● Reduction of agency overhead in internal support functions, particularly through new technology gains in the human resource area, starting in 2005.

The savings from the three initiatives will allow the IRS to fill 2,200 new positions. Between 1996 and 2002, the IRS enforcement resources, including criminal investigators, revenue agents and revenue officers, went down by more than a quarter.

"Savings from these initiatives will allow the IRS to hire more people to pursue cheating by high-income individuals and corporations, continue our attack on abusive tax shelters, bolster our criminal investigation efforts and assist with other enforcement priorities," Everson said.

-- WebCPA staff

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