Rossotti outlines IRS reforms for contractors

It will take the Internal Revenue Service more than a decade to fully modernize and reform its operations, IRS Commissioner Charles O. Rossotti told members of the Professional Services Council at a Tuesday luncheon.

The Professional Services Council (PSC) is the national trade association representing for-profit professional and technical services contractors doing business with the public and private sectors. Computer Sciences Corporation (CSC), a PSC member, is leading the team of contractors known as the Prime Alliance that is partnering with the IRS on its systems modernization plan. Former PSC president Bert Concklin is now heading the Business Systems Modernization Office at the IRS.

Rossotti discussed IRS efforts to replace its antiquated taxpayer database, upgrade internal communications systems and provide better customer service to taxpayers. The IRS is creating new business units to focus on specific customer segments-small businesses, individual taxpayers, large corporations and nonprofit organizations-rather than organizing along geographic lines, as it has done in the past.

"I know the opportunities exist to improve the way we [the IRS] deliver services to the taxpayer," Rossotti said. But he acknowledged that the effort could take several years to complete.

Since Rossotti arrived at the IRS in November 1997, he has received kudos from Congress, Clinton administration officials and industry leaders for his efforts to modernize the beleaguered agency and for working effectively with the IRS' many stakeholders.

In July 1998, Congress passed the IRS Restructing and Reform Act in response to calls for better service from the IRS. The act required the agency to implement 71 new or modified taxpayer rights provisions. The provisions were intended to make collection agents more accountable for their cases.

According to IRS data, 1999 collections from delinquent taxpayers were down about $2 billion from 1996 levels. By April 23, the agency reported that it had processed 83.1 million tax returns-3.2 million more than in the same period last year. Electronic filing has become more popular as well. By April 21, almost 35 million individual taxpayers filed their returns using one of three e-file options.