New Law Aims to Improve Taxpayer Experience through IT Modernization
Published: July 11, 2019
Last week, the president signed into law the Taxpayer First Act, H.R.3151, which strives to improve IRS customer service, cybersecurity and identity protection, IT management, use of electronic systems, and enforcement procedures.
Senator Rob Portman (R-OH) said in a statement, “This bill, now law, represents the most significant reform to the IRS in two decades and is an important first step toward restoring full faith in one of our government’s most important agencies.” The new law contains several provisions first introduced by Portman last year in legislation entitled the Protecting Taxpayers Act.
Specific IT-related provisions of the law require the IRS to:
- Develop comprehensive customer service and IRS personnel training strategies
- Establish requirements for cybersecurity and identity protection
- Provide notification to taxpayers of suspected identity theft
- Appoint a CIO who shall develop and implement a multiyear strategic plan for IRS information technology needs
- Modify requirements for managing IRS information technology
- Expand electronic filing of tax returns
- Require mandatory e-filing by tax-exempt organizations and notice before revocation of tax-exempt status for failure to file
- Implement an Internet platform for Form 1099 filings
- Establish a fully automated program for disclosing taxpayer information for third-party income verification using the internet
- Develop uniform standards and procedures for accepting electronic signatures
Cybersecurity and identity protections are to include establishing an information sharing and analysis center, and a public-private partnership to address identity theft refund fraud. Other provisions encompass contractor compliance with confidentiality safeguards, supplying taxpayers with personal identification numbers, establishing a single point of contact for tax-related identity theft victims, and notifying taxpayers of suspected identity theft.
Another important provision of the new law reinstates streamlined critical pay authority for IT positions until the end of FY 2025. IRS will be able to skirt normal federal hiring procedures and onboard up to 40 temporary IT personnel in six to eight weeks. The new hires can work for the IRS for up to four years and could qualify for as much as $240,000 per year in pay.
Timing of the new legislation coincides with implementation of IRS’s Integrated Modernization Business Plan which is expected to take six years and cost up to $2.7 billion. However, funding for enactment of the new law’s requirements is a concern. The legislation provides no new funding to the IRS for implementation.
Contractors will likely find opportunities to assist IRS in in implementing provisions of the new legislation and improving the taxpayer experience. Areas of opportunity could include web applications, case management, API management, cloud computing, digitization, RPA, VDI, IAM, and vulnerability and threat management. Contract vehicles that may be used to procure these products and services include TIPSS4, Schedule 70 and SEWP V.