IRS Computer Systems Showed Improvement in 2000

Computer systems used by the Internal Revenue Service to process income tax returns performed slightly better in 2000 than in 1999, despite the risks associated with making systems year 2000 compliant, according to a General Accounting Office report issued Dec. 22.

The IRS made massive changes to ensure its systems were year 2000 compliant. The changes included correcting millions of lines of software code and upgrading or replacing thousands of hardware and software products.

Although the changes were tested extensively, agency workers had anticipated that problems might occur. But the federal agency's performance in processing returns and refunds was as good or better in 2000 than in 1999.

Changes the IRS made to reduce errors and enhance processing seemed to reduce errors made by taxpayers and tax return preparers, the report said.

The IRS' goal was to process 85 percent of refunds on paper returns within 40 days and 99 percent of refunds on electronic returns within 21 days. The IRS exceeded both those goals and also exceeded its performance in 1999.

This improvement was especially significant for paper returns, where performance increased from 84.7 percent to 92.1 percent.

The GAO identified some areas where the IRS could improve its services. Taxpayers' ability to reach the IRS on the phone improved compared to 1999, but was still below the agency's performance in 1998. The IRS' Web site showed increased use and improved performance compared to 1999, but some information it contained was outdated or inconsistent.

Also, the IRS could not assess the timeliness or taxpayer satisfaction of services provided by volunteer tax preparation sites.

IRS Commissioner Charles Rossotti said last week the agency is working hard to improve service for all taxpayers.

Rossotti's comment coincided with the release of the governmentwide American Customer Satisfaction Survey, which is sponsored by the President's Management Council.

The survey showed that the overall customer satisfaction score for electronic filing increased to 75 in 2000, one point above 1999 and well above the government's average score of 68.6 out of 100.

The survey also found that the overall customer satisfaction score for paper filing was 48, but noted that satisfaction with paper filing is most affected by circumstances beyond IRS control, such as the complexity of the tax code.

"The survey findings support the IRS' own experience with electronic filing ? that taxpayers who try it really like it," Rossotti said.