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IRS IT Systems Improve, But Security Risks Remain

by Mike Godfrey, Tax-News.com, Washington

07 December 2012


The United States Internal Revenue Service (IRS) has implemented significant new information technology (IT) capabilities over the past year, but needs to continue its efforts to deliver new systems and protect sensitive financial and taxpayer data, according to a report released by the Treasury Inspector General for Tax Administration (TIGTA).

TIGTA reviews the IRS’s IT systems annually, so as to perform an evaluation of the adequacy and security of IRS technology, as required by the IRS Restructuring and Reform Act of 1998. It notes that, since TIGTA’s 2011 assessment, the IRS implemented daily processing and database implementation projects and a new release of the Modernized e-File system.

However, TIGTA continues to believe that the IRS’s Modernization Programme remains a major risk and that improved controls are needed to ensure long-term success for key systems within the Programme. Further, the development and implementation of new systems, which are needed to implement provisions of the Patient Protection and Affordable Care Act, introduce significant risk management challenges.

TIGTA’s assessment stresses the importance of continued improvements in the overall control environment within IRS systems. “The IRS made significant progress in modernizing its system, but it must continue its efforts to ensure that its computer systems are effectively secured to protect sensitive financial and taxpayer data,” said J. Russell George, the TIGTA.

TIGTA finds that the IRS has made progress to improve information security and personnel safety, but that it needs to continue to place emphasis on information and physical security programmes in order to ensure that policies, procedures, and practices adequately address security control weaknesses. TIGTA auditors have identified weaknesses over system access controls, configuration management, audit trails, physical security, remediation of security weaknesses, and oversight and coordination on security related issues.

“Until the IRS addresses security weaknesses, it will continue to put the confidentiality, integrity and availability of financial and taxpayer information and employee safety at risk,” George added.

TAGS: tax | law | Internal Revenue Service (IRS) | tax authority | legislation | United States | standards | services

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