IRS' integrated strategy for IT modernization

The IRS will implement its Business Systems Modernization in smaller increments and in a more unified strategy between IT and agency business units than previously expected, CIO Richard Spires said today.

The tax agency released its IT Modernization Vision and Strategy and associated plans for the next five years.

IRS revised its IT modernization strategy as a result of decreased funding in recent years and better management of its systems development after years of cost overruns and delays. The agency also has in the past year reorganized its program management and combined its two applications development organizations.

The new strategy emphasizes not only introducing new applications, but making use of older ones in a modernized environment, sharing applications and reusing data or parts of data, Spires said at an industry event sponsored by market research firm Input Inc. of Reston, Va. The IRS will also use common services, standards, infrastructure and security to drive a unified approach.

IRS hopes that this enterprise view will make it more efficient, lower costs and provide better services over time, he said.

“With the combined data strategy, the use of an enterprise integration broker, portal redesign to try and drive the use of portals across the board [and] the account management services … as these all come together, [we expect] to actually start to simplify the IT environment rather than continuing to add systems and make it even more complex,” Spires said.

IRS is prioritizing its needs around six domains, including submission processing, which covers electronic filing. Under this domain, IRS continues to replace its 40-year-old Master File with its relational taxpayer database, the Customer Account Data Engine (CADE).

CADE processed 12 million tax returns this year. Next year, the IRS expects to process 30 million, including those that may have questions and require communication with the taxpayer, said Tom Lucas, senior adviser in IRS’ enterprise architecture division.

With CADE ramping up to handle so many returns, the IRS will implement account management services, such as case processing, sending notices and monitoring for follow-up.

Depending on resources, IRS listed applications it would like to pursue, such as expanding e-filing options to accept all return types and forms to immediately identify problems; expand electronic payment options to include services such as stored value cards or PayPal; convert paper payment, such as checks and coupons, to electronic data at points of receipt and provide viewing of payment data, the IRS plan summary said.

“IRS is trying to become a modern financial institution,” said Andrew Buckler, acting director of business systems planning.

IRS also has a goal to be able to share data across domains, such as payment compliance and criminal investigations, and business units, he said.

“We need different ways to collect data centrally and cut data so business units can create their own algorithms to use the data,” Buckler said.

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