Waste of the Day: IRS Bought, But Didn’t Use, Software To Improve Customer Service

Topline: The IRS has never been the most popular government agency, but a new audit report says their customer service is so poor it could lead to tax returns being filed incorrectly or not at all.

IRS has clunky, kludgy customer service software

Key facts: The IRS runs 363 in-person Taxpayer Assistance Centers to help people fill out their taxes or get legal advice.

But the process for changing or canceling an appointment at one of the centers creates a “burden” for taxpayers because many IRS customer service agents don’t have access to the software that lets them view or change in-person appointments.

There’s a baffling reason for that: the agency pays for 2,500 software licenses each year so agents can edit appointments, but auditors found 768 licenses not even being used.

Each license costs $56 annually, so that’s $43,000 spent last year on the unused licenses.

When customers call the IRS to edit or cancel an appointment, they are instructed to hang up and call a different “Appointment Telephone Line” number.

Agents were not allowed to transfer calls directly to the Appointment Telephone Line, though managers could not explain to auditors why this policy is in place. It was changed last December.

Even some agents working the Appointment Telephone Line don’t have access to the correct software. They’re forced to transfer calls to yet another IRS agent who can finally provide assistance. There were 144,005 transferred calls in fiscal year 2023, according to the audit report.

Last year 75,000 people did not show up to scheduled in-person appointments at Taxpayer Assistance Centers, which auditors said is likely because they got frustrated with customer service and gave up on canceling their appointment.

Violates the Taxpayer Bill of Rights

Critical quote: Auditors wrote that, “The lack of a streamlined appointment process can result in extended wait times … which can potentially delay taxpayer return filings and reduce the public’s trust in the IRS’s efficiency.”

Background: The IRS “Taxpayer Bill of Rights” says everyone is entitled to “prompt, courteous, and professional assistance” with their taxes.

But the IRS disconnected 6.1 million phone calls in fiscal year 2022 and 1.5 million calls in fiscal year 2023 because they didn’t have enough agents manning customer service lines, according to the audit report.

Meanwhile, the IRS paid six-figure salaries to 11,486 employees last year, according to OpenTheBooks.com. What are all those staffers doing if not assisting taxpayers?

Summary: The $43,000 the IRS spent on its unused software licenses is just a tiny fraction of the agency’s total budget, but it’s representative of much larger issues with tax simplicity and transparency.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com.

This article was originally published by RealClearInvestigations and made available via RealClearWire.