Just days before the national tax-filing deadline, the Internal Revenue Service chief warned Thursday that congressional delay on expiring tax-break provisions could lead to “total confusion” among working Americans.
“We’ve really made a lot of lasting progress at the IRS that will really serve the nation well for the years to come,” he said.
Mr. Shulman said taxpayers should be able to notice the technology changes as early as this year, in the form of shorter return-processing times and thus quicker refunds. It also means the agency will be able to provide up-to-date information and real-time data to taxpayers.
“This year, the IRS successfully migrated from a weekly processing cycle to a daily processing cycle,” Mr. Shulman explained. “It’s an incredibly important milestone for the IRS. It’s already benefiting taxpayers this year.”
Mr. Shulman also said more taxpayers are filing online, which is easier and saves the agency money - it costs 15 cents to process an online return, versus $3.50 for a paper return. In 2011, 77 percent of taxpayers filed online, compared with only 16 percent of taxpayers who filed online 15 years ago. It also means, he said, that “you get your refund faster.”
But Mr. Shulman also complained that the IRS is underfunded, which in the past has led to slow technology adoption. “There’s been a real reluctance to fund our technology,” he said. “So I would argue we’ve been underfunded for many years in the technology space.”
The IRS is also ensuring that professional tax preparers are competent enough to do the job, he said, noting that the agency will start requiring that people who are not certified public accountants pass tests.
“The vast majority of tax preparers are honest, ethical, hardworking,” he said. “The problem is there are unscrupulous preparers out there.”
“We want to make sure as people wrestle through it, if they’re going to pay a professional to do it, that that professional is competent and ethical.”
Mr. Shulman also said the IRS has taken big steps to improve customer service. In 1998, the agency “hit rock bottom” in customer service, he said, but it has since climbed to a personal historic high score of 73 in a special report by the American Customer Satisfaction Index.
“Providing customer service is every bit as important to us as enforcing tax laws,” he said.