Priority Open Recommendations: Internal Revenue Service

Fast Facts

Each year, we make more than 1,000 recommendations to help the federal government save money, address issues on our High Risk List, and significantly improve government operations.

This letter to the Internal Revenue Service outlines 30 open recommendations that it should prioritize, including some for ensuring taxpayer data security and providing quality taxpayer services. For example, we recommended IRS maintain a comprehensive inventory of the systems it uses to process or store taxpayer information.

IRS implemented 3 recommendations we identified as a priority last year. We regularly update priority recommendations here.

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Highlights

What GAO Found

In July 2023, GAO identified 24 priority recommendations for the Internal Revenue Service (IRS). Since then, IRS has implemented three of those recommendations by, among other things, updating plans for modernizing its system for processing information returns—filed by third parties such as financial institutions—and developing an option for free online filing of tax returns.

GAO closed two other recommendations related to IRS partnership audits because they were no longer valid due to changes in law. GAO also removed the priority designation from one recommendation related to foreign retirement accounts because of changing circumstances. GAO continues to believe this recommendation should be implemented.

In June 2024, GAO identified twelve additional priority recommendations for IRS, bringing the total number to 30. These recommendations involve the following areas:

Managing agency transformation,
Ensuring taxpayer data security,
Providing quality taxpayer services,
Improving enforcement and audit selection,
Enhancing information reporting, and
Enhancing strategic human capital management.

IRS's continued attention to these issues could lead to significant improvements in government operations and potential financial benefits.

Why GAO Did This Study

Priority open recommendations are the GAO recommendations that warrant priority attention from heads of key departments or agencies because their implementation could save large amounts of money; improve congressional and/or executive branch decision-making on major issues; eliminate mismanagement, fraud, and abuse; or ensure that programs comply with laws and funds are legally spent, among other benefits. Since 2015, GAO has sent letters to selected agencies to highlight the importance of implementing such recommendations.

For more information, contact Jessica Lucas-Judy or James R. McTigue, Jr. at (202) 512-6806 or lucasjudyj@gao.gov or mctiguej@gao.gov.