The Internal Revenue Service managed to collect more tax dollars from delinquent taxpayers, even while contending with cuts in its revenue collection workforce.

A new report from the Treasury Inspector General for Tax Administration found that the total dollars collected in fiscal year 2011 were 20 percent higher than the amount collected in fiscal 2009 even though there were fewer revenue officers on staff. Revenue officers also completed their investigations more quickly, according to the TIGTA report, and made trust fund penalty determinations faster in fiscal 2011 compared to fiscal 2009.

Nevertheless, the report noted that improvements are needed in how the IRS monitors, measures and reports on the effectiveness of the Collection Program in order to adequately assess its performance. The information would help IRS managers make decisions about how to fund and allocate resources at the agency to collect the estimated $360 billion from taxpayers who owe, but have not paid the taxes due from them.

Specifically, the report recommended that the Collection Program integrate the IRS’s balanced measures to include customer and employee satisfaction and business results into all performance reports. This would help hold managers and staff across Collection Program areas accountable for and focused on balancing service to taxpayers with enforcing the tax laws, as articulated in the IRS mission and its two strategic goals and one strategic foundation.

TIGTA also recommended linking the Collection Program’s performance measures used at the operational level to a specific operational objective and to one or more of the IRS’s strategic goals. Such links could show Collection Program managers how their day-to-day activities contribute to attaining the Collection Program’s operational objectives and the broader IRS strategic goals.

The IRS should also develop and implement meaningful performance targets for each of the operational-level measures, the report suggested. If objectively established, the targets would help Collection Program managers avoid any perception of bias or manipulation in the monitoring and reporting of progress in meeting their pre-established objectives.

In addition, TIGTA recommended that the IRS ensure that customer satisfaction and employee satisfaction measures are included in all performance reports. The IRS should also establish a performance measure and target for each operational objective.

In response to the report, the IRS agreed with TIGTA’s recommendations and plans to include customer satisfaction and employee satisfaction in all performance reports. In addition, the IRS said it plans to assess the need for new measures or changes to existing measures to ensure proper alignment with operational goals.

“The IRS agrees that sound decision making requires organizations to pursue continual improvement in how performance is assessed,” wrote Faris R. Fink, commissioner of the IRS’s Small Business/Self-Employed Division. “To ensure that balanced measures adequately represent key IRS Collection programs, we have taken steps to add program-level customer and employee satisfaction measures and diagnostics supported by a variety of quantitative and qualitative analyses.”

Register or login for access to this item and much more

All Accounting Today content is archived after seven days.

Community members receive:
  • All recent and archived articles
  • Conference offers and updates
  • A full menu of enewsletter options
  • Web seminars, white papers, ebooks

Don't have an account? Register for Free Unlimited Access