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TIGTA Criticizes IRS IT Program

by Scott Hamilton, Tax-News.com, Washington

31 October 2016


The US Internal Revenue Service (IRS) needs to work on its use of information technology to secure tax data and maintain taxpayer privacy, according to a recent report from the Treasury Inspector General for Tax Administration (TIGTA).

TIGTA annually assesses and reports on the adequacy and security of IRS information technology, as required by the IRS Restructuring and Reform Act of 1998. TIGTA's overall objective was to assess the progress of the IRS's Information Technology Program, including security, and improving tax systems and online services.

"Security for Taxpayer Data and IRS Employees" has been designated by TIGTA as the number one management and performance challenge facing the IRS for the sixth consecutive year. Weaknesses within the IRS's Information Technology Program could result in computer operations that become compromised, disrupted, or outdated.

TIGTA identified weaknesses within the IRS's cybersecurity program in which three areas need significant improvement, including identity and access management. It also identified weaknesses in the electronic authentication process controls. Additional areas that need improvement include physical security controls, and backing up and restoring data.

It noted that the IRS continues to update its systems in an effort to combat identity theft and tax refund fraud. During the 2016 Filing Season, the IRS implemented three new data elements for its Return Review Program. As of March 25, 2016, the IRS had detected USD72m in suspected tax return refund fraud that was directly attributable to the new data elements. The IRS is testing additional new data elements for future implementation.

The IRS also continues to develop systems to implement the Affordable Care Act and other tax law changes and successfully tested the functionality and security of the Affordable Care Act Compliance Validation System. However, the Foreign Account Tax Compliance Act Program Withholding & Refund Release 2.0 system was built to requirements, but has not provided the intended business results.

TAGS: compliance | tax | business | tax compliance | law | Internal Revenue Service (IRS) | tax authority | internet | United States | services | Tax

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