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Tax Administration: IRS Tax Debt Collection Practices

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Report Type Reports and Testimonies
Report Date April 25, 1996
Report No. T-GGD-96-112
Subject
Summary:

The Internal Revenue Service (IRS) confronts major hurdles in collecting tens of billions of dollars in delinquent taxes. As Congress tries to balance the federal budget, these unpaid taxes have become increasingly important as have IRS' collection efforts. GAO testified that IRS could do more to improve its collection practices. Valuable lessons may be gained from IRS' pilot program testing the use of private debt collectors. IRS' improvement efforts are jeopardized by a lack of reliable information on its accounts receivable and the effectiveness of its collection tools, an aged inventory of receivables, outdated collection processes, and antiquated technology. IRS needs a long-term strategy to guide its efforts to improve delinquent tax collection. The key to any improvement lies in having accurate and reliable information. In addition, the private sector may be able to assist IRS by performing some collection activities.

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