Ways and Means Passes Walorski Measure to Strengthen IRS IT Accountability

Wednesday, April 11, 2018

Ways and Means Passes Walorski Measure to Strengthen IRS IT Accountability

House Set to Vote on Bipartisan IRS Reform Package After Committee Advances Overhaul Bills

WASHINGTON – The House Ways and Means Committee today approved bipartisan legislation to overhaul the Internal Revenue Service (IRS), including a measure introduced by U.S. Rep. Jackie Walorski (R-Ind.) to strengthen IRS accountability for modernizing its information technology (IT) systems.

“The IRS works for the American people, and it needs modern IT systems to serve taxpayers effectively,” Congresswoman Walorski said. “However, repeated failures, delays, and cost overruns have put the IRS behind the technology curve and left taxpayers on the hook. We are taking a critical step with this bipartisan legislation to close the trust gap by restoring IRS accountability, modernizing IT systems, and putting American taxpayers first.”

Video of Walorski speaking about the legislation at today’s markup is available here.

BACKGROUND

The House Ways and Means Committee approved several bills to reform the IRS and strengthen accountability to better protect taxpayers, including the bipartisan 21st Century IRS Act (H.R. 5445). This legislation contained Walorski’s bill, the IRS Information Technology Accountability Act (H.R. 5362), which would improve accountability by codifying the role of the IRS’s chief information officer (CIO) and establishing clear responsibilities, including:

  • Developing and implementing a multiyear strategic plan for the IRS’s IT needs, to be updated annually and aligned with the overall strategic plan of the IRS.
  • Developing, implementing, and maintaining IT systems, and ensuring they are secure and integrated.
  • Coordinating with the IRS’s chief procurement officer to ensure all IT acquired by the IRS is consistent with these goals.
  • Maintaining operational control of all IT for the IRS.
  • Serving as the principal advocate for the IRS’s IT needs.

Further, it would clarify the definition of “information technology” and require the chief procurement officer to provide advance written notice of all significant IT acquisitions to the CIO. It would also require IRS to have an independent third party verify and validate plans for the completion of the Customer Account Data Engine 2 (CADE 2) and Enterprise Case Management (ECM) systems.

The IRS relies on several legacy IT systems, some dating back to the 1960s, but has struggled to complete major IT modernization projects despite spending approximately $2.4 billion annually on IT.

  • Nearly 10 years after the IRS began developing CADE 2, a new system for individual tax account data, it has spent more than $1 billion on the project, which is still years away from completion.
  • The IRS began developing a streamlined, centralized ECM system in 2015, to be implemented in December 2018, but last year the project was suspended in part because the IRS determined the software product procured for ECM could not support an enterprise-wide deployment.
  • Five years after embarking on the Return Review Program (RRP), a new fraud detection program, the IRS put the project into “strategic pause” in 2014, in part to answer basic questions about its purpose, direction, and role in the broader IRS vision. RRP is now operational, but it came in years behind schedule and hundreds of millions of dollars over budget.

Walorski highlighted these and other IRS IT modernization failures at a January hearing of the Ways and Means Oversight Subcommittee. She also questioned IRS officials at a hearing in October about the no-bid contract awarded to Equifax following its massive data breach.

Walorski represents the 2nd Congressional District of Indiana, serving as a member of the House Ways and Means Committee.

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