Summary: GAO testified last year that eight issues confront the Internal Revenue Service's (IRS) multibillion dollar Tax Systems Modernization program, ranging from improving the procurement process to paying more attention to security and privacy issues. While IRS has made significant progress since then in addressing these critical areas, GAO remains concerned about IRS' planning, technological readiness, and procurement and systems development processes. GAO is also concerned about IRS plans to use cutting edge technology to modernize input processing, especially since the agency has no fallback position should this technology not be ready when needed. Finally, in spite of better management of procurement and systems development processes, problems continue. For example, IRS missed opportunities to head off successful protests of its $1.4 billion Treasury Multi-User Acquisition Contract procurement. Ultimately, the success or failure of modernization will rest on a commitment to the program by IRS top management, including following through and making sure that each of the eight critical success factors is addressed.
