GAO Reports  
T-AIMD-95-86 February 16, 1995

Tax Systems Modernization:
Unmanaged Risks Threaten Success
(Summary only)

The Internal Revenue Service's (IRS) goal is a paperless work environment in which tax returns are filed electronically and information on paper returns and other documents is quickly converted to electronic data that are immediately accessible to IRS employees. However, after spending almost $2 billion over eight years to modernize the nation's tax system, IRS has realized only marginal improvements in its operations, and future efforts are at risk of failure. Initial systems were not built to be integrated into IRS' comprehensive Tax Systems Modernization program and they have yet to deliver the expected increases in capability and customer service. Future efforts are at risk because of (1) the lack of technical and management expertise to implement Tax Systems Modernization; (2) the failure of ongoing systems development to take into account changes arising from process improvements; and (3) the lack of set system development priorities, established performance measures, or fully established technical guidelines.

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