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The IRS Announces a New Office That Will Focus on Taxpayer Experience

One of several lines of effort at the IRS to improve customer experience is digital services, which will include efforts ranging from digital signatures to expanded online payment options.

The Internal Revenue Service announced a new Taxpayer Experience Office meant to shore up taxpayer service at the struggling agency on Friday.

"As the IRS continues taking immediate steps this filing season including adding more employees to address the significant challenges facing a resource-constrained IRS, it's critical that we work going forward to equip the IRS to be a 21st century resource for Americans," said IRS Commissioner Chuck Rettig in a statement. "The formal establishment of this office will help unify and expand efforts across the IRS to improve service to taxpayers."

The IRS says that the new office will work on all parts of "taxpayer transactions" across the IRS.

The announcement of the new office comes amid news first reported by the Washington Post that the IRS has obtained special hiring authority to add 10,000 new employees as part of a concerted effort to reduce its backlog of more than 24 million returns.

"It is clear that understaffing in these areas contributes to the backlog in processing of tax returns and taxpayer correspondence," Tony Reardon, national president of the National Treasury Employees Union which represents IRS workers. Reardon said that the direct hire authority would expire at the end of 2023.

Efforts to improve IRS customer experience were outlined in a report to Congress last year, required by the 2019 Taxpayer First Act that mandated better customer experience at the IRS, where the IRS outlined a Customer Experience Strategy for the agency. 

One key focus area for the next decade is expanded digital services. The IRS says that it wants to expand online accounts with new tools like digital notifications and the ability to update contact information, as well as create similar online accounts for businesses and tax professionals. There's also efforts around document exchange abilities and digital signatures, as well as expanded online payment options.

Near term improvements from the new office will include expanded payment options, secure two-way messaging between Americans and IRS representatives and services for multilingual customers, the IRS says. 

The Biden administration's executive order  on customer experience is part of what's driving the new office.

That order directed the Treasury Department to "design and deliver new online tools and services to ease the payment of taxes" and also give the option to schedule customer support call-backs. It also flagged the consideration of expanded automatic direct deposits refunds based on prior tax returns, tax credit eligibility tools and expanded electronic filing options. 

Longer-term, this new office is meant to guide customer experience efforts agency-wide, the IRS says, using taxpayer expectations, industry trends and best practices. It will develop agency taxpayer experience guidelines and expectations. 

"The IRS is committed to customer experiences that meet taxpayers where they are, in the moments that matter most in people's lives and in a way that delivers the service that the public expects and deserves," said Chief Taxpayer Experience Officer Ken Corbin, who is also the commissioner of the Wage and Investment division.

The IRS is also grappling with how to do identity verification for online accounts. It recently announced it will pivot from private company, which uses biometrics, to General Services Administration's after this tax season.