Summary

The Internal Revenue Service (IRS) is undergoing a major effort to modernize its information systems and restructure its organization. This effort involves several components, one of which IRS calls its "customer service vision," which seeks to improve IRS interactions with taxpayers and fold parts of IRS' field structure into 23 customer service centers. These centers would work primarily by telephone to provide taxpayer service, distribute forms, collect unpaid taxes, and adjust taxpayer accounts. The would absorb current IRS telephone operations and try to convert much of IRS' written correspondence work to the telephone. This report review IRS' progress toward its customer service vision. GAO discusses (1) IRS' goals for customer service and its plans to achieve them, (2) the gap between current performance and these goals, (3) its progress to date, (4) current management concerns, and (5) several important challenges that IRS faces. GAO believes that this report will be useful as a baseline for assessing IRS' progress in coming years.

GAO found that: (1) IRS customer service goals are to provide better service to taxpayers, utilize its resources more efficiently, and improve taxpayers' compliance with tax laws; (2) IRS expects to improve its efficiency by having fewer work locations and automated workload management, giving customer service representatives better computer resources and access to taxpayer accounts, improving taxpayers' accessibility to telephone service, and allowing taxpayers to resolve their inquiries after a single telephone contact; (3) IRS has made progress toward its vision by initiating limited operations in new customer service centers; (4) current IRS management concerns include the lack of ownership for customer service, the absence of owner involvement during project development, and inadequate quality control to measure interactive telephone systems performance; (5) these management concerns have not had serious adverse effects on IRS goals because implementation of the customer service vision is still in the beginning stages; and (6) IRS will have to determine how to manage the transition to a different organization while maintaining ongoing workloads and developing and using new information technology in order to attain its customer service goals.