IRS Needs To Do More In Underserved Markets – TIGTA

The Internal Revenue Service needs to do more in underserved markets, according to a recent report from the Treasury Inspector General for Tax Administration.

“The IRS has made improvements to increase the accessibility and availability of customer service in underserved, underrepresented, and rural communities; however additional efforts are needed to improve the geographic outreach efforts in these communities,” a June 25, 2024, report states.

One of the problems identified in the report is that while there are various models that the agency uses to identify these populations, “there is no clear definition for these populations. Without a clear definition of what constitutes these populations, the IRS is unable to measure its progress in increasing accessibility and availability to these segments of taxpayers.”

The agency watchdog noted that not having a clear definition “presents a risk that the IRS will not meet the objectives of the SOP [Strategic Operating Plan] and as such, will not provide additional service where it is needed and to whom needs it.”

TIGTA also reported that the IRS’s data for determining locations to set up Taxpayer Assistance Centers is out of date and causing the agency to not reach these underserved populations. The agency is currently using demographic data from 2016 to identify the availability of TACs but, as TIGTA reports, citing U.S. Census Bureau data, “approximately 8.2 million people moved to different states in 2022. Considering the IRS is using data over six years old, the information is most likely outdated and therefore, the IRS may be incorrectly identifying where underserved and underrepresented populations are located.”

TIGTA also called for a more comprehensive communications strategy to reach these populations.

“[W]e identified that additional efforts are needed to market these efforts to increase taxpayer education and awareness as to these eligible services,” including TACs, Volunteer Income Tax Assistance, Low-Income Taxpayer Clinics, and Taxpayer Counseling for the Elderly, the report stated.

For example, IRS management stated that some events in rural communities had low attendance, with IRS management noting that the agency “relies on the local contact personnel within each community to help spread the word about these types of events,” TIGTA reported. “Intentional planning and focused marketing strategies could increase taxpayer participation.”

TIGTA made a number of recommendations with it said the IRS agreed with.

By Gregory Twachtman, Washington News Editor