Home Media Center News Releases

Washington, D.C.—At the 10-year anniversary of the most massive remaking of the Internal Revenue Service (IRS) in half-a-century, it is clear that much of the promise of the IRS Restructuring and Reform Act of 1998 (RRA) has yet to be fulfilled, the leader of the union representing tens of thousands of IRS employees said today.

One of the most significant issues, said President Colleen M. Kelley of the National Treasury Employees Union (NTEU), is that “the underlying commitment in RRA to increase and improve service to taxpayers simply has not been met, either by providing adequate resources or making needed changes in IRS policy.”

As evidence, the NTEU leader pointed to the agency’s efforts—turned back by NTEU—to close 68 of its taxpayer assistance centers across the country; and the IRS’s continuing work to drive taxpayers to the agency’s web site for all manner of help, much of which can only be delivered effectively in person.

Inadequate resources, she said, and the politically-motivated insertion in RRA of language that has come to be known as “the 10 deadly sins”—actions by IRS employees requiring termination of their employment—have also limited the IRS’s ability to maximize enforcement efforts.

“It is clear,” President Kelley said, “that this language had a chilling effect on enforcement of our nation’s tax laws.”

Among the most important lessons of the 10 years since enactment of RRA, she said, is that the IRS needs adequate funding and resources, along with a sufficient roster of trained, experienced employees in order to meet its responsibilities. “The IRS falls far short on both of those measures,” Kelley said.

Between 1995 and 2007, a period encompassing RRA, the IRS workforce shrunk from 114,064 to only 86,638—including declines of 33 percent among revenue officers and 20 percent among revenue agents, two groups of employees key to the enforcement function. These drastic cuts have come at a time when the IRS workload has increased dramatically; both the number of tax returns filed and the complexity of the documents filed have increased many times over.

For example, Kelley said, between 1997 and 2007, the number of individual tax returns with $100,000 in reported income, which are generally more complex returns, increased by 103 percent.

Even so, she said, “IRS employees continue to earn the highest marks, from both within the agency and outside of it, for their professionalism and dedication to duty, delivering a successful tax-filing season year after year, despite the growing complexities of the tax code and the continually rising number of tax returns of all types.”

Enforcement revenue has nearly doubled since 2002 despite stagnant staffing. And, earlier this year, the IRS Data Book for 2007 demonstrated that the IRS is one of the most efficient tax collection systems in the world, spending only 40 cents to collect $100.

Additionally, this year IRS employees conducted a successful filing season while implementing a last-minute adjustment by Congress to the alternative minimum tax (AMT) and handling a huge increase in the number of individual returns and calls received, due to the economic stimulus payments.

“The 10-year anniversary of RRA provides an opportunity to reflect on the policy and operational steps that need to be taken to make sure the IRS has the employees it needs to continue and improve service to the public,” President Kelley said.

NTEU has previously called for a five-year hiring plan that would gradually rebuild the IRS workforce to pre-1996 levels.