Treasury Inspector General Faults IRS on Savings and Security

The Inspector General for Tax Administration of the U.S. Treasury has criticized the Internal Revenue Service on grounds of overstating savings related to taxpayer service projects and for shortcomings in security. The efficiency savings on service activities were found to be unsupported, thus producing the possibility that funding cuts in service activities may actually reduce service to taxpayers as opposed to being covered by better efficiency. On the security front, the IRS was blamed for poor encryption, sloppiness in password selection and not safeguarding laptops.

The recent turnover in top IRS positions probably is not helpful in many of the problems cited by the Inspector General. New director Linda Stiff will have to make a real effort to improve security and may need to work on the bureau's culture. Meanwhile, Taxpayer Advocate Nina Olson also has a challenging situation in trying to protect services provided to taxpayers.