U.S. Department of the Treasury 

 

How A Transformed IRS Will Improve Tax Fairness 

President Biden in August 2022 signed the Inflation Reduction Act (“IRA”), providing critical 

resources to modernize the IRS after decades of underfunding. The Strategic Operating Plan 

shows how the IRS will use IRA resources to provide taxpayers with world class customer 

service and reduce our deficits by hundreds of billions by pursuing high dollar noncompliance.

For the first time, the IRS will help taxpayers get it right—filing accurate returns that ensure 

timely refunds and claiming the credits and deductions for which they are eligible. The IRS will 

reimagine the taxpayer experience to ensure individuals, families, and businesses are able to 

seamlessly interact with the IRS in the ways that work best for them: on the phone, in-person, 

and online. 

Improved outreach, technology, and customer service will contribute to tax fairness by helping 

more taxpayers become aware of and correctly claim the benefits and credits for which they are 

eligible. The IRS will regularly evaluate and address enforcement disparities and focus its 

enforcement expansion on ensuring that high-income taxpayers, large corporations, and complex 

partnerships pay the taxes they owe. These improvements will enable the IRS to serve all 

taxpayers fairly and in the way they want to be served.

Improved 21st century tax filing: The IRS will become fully digital and modernize forms and 

processes to improve the taxpayer experience and organizational efficiency while emphasizing 

fairness, accessibility, and taxpayer privacy. 

• The IRS will enable taxpayers to securely access their own account data, including 

transcripts, account balances, payment and account histories, notices, service history, and 

more. Current individual tax transcripts will be updated to be more user-friendly and 

available in more languages in 2024.

• By 2025, the IRS will develop the capability to provide data it already has in a format 

that is compatible with return preparation software or to authorized return preparers to 

help taxpayers start their tax returns. This service will reduce the chance that taxpayers 

accidentally make mistakes or omissions that requires filing an amended return or 

correcting an error after filing.
• Modernized forms will be easier to use, mobile-friendly, and take advantage of digital 

capabilities and interactive features that paper forms lack. Process improvements may 

include modernizing the Individual Tax Identification Number (ITIN) process and fully 

digitalized amended return processing. 

New improvements to help taxpayers understand and claim credits and deductions for 

which they are eligible: By providing timely and personalized information about available 

credits and deductions, the IRS will help taxpayers claim the credits and deductions for which 

they are eligible.

• The IRS will use available data to proactively deliver clear, informative, and personalized 

alerts to help taxpayers claim the credits and deductions for which they are eligible. 

• Taxpayers will have the ability to share life changes (i.e., marriage, divorce, job changes, 

births, deaths, retirements) with the IRS to learn about potential tax impacts and opt into 

personalized alerts. 

• The IRS will also make it easier for taxpayers to help themselves, including incorporating 

a “credits and deductions” search function in Online Accounts and improving relevant 

content on IRS.gov.

• The IRS will use analytics to analyze gaps in tax credits and deductions participation in 

FY 2024, especially those intended to benefit underserved communities. These findings 

would be incorporated into IRS statistical reporting. 

Expanded taxpayer outreach to meet taxpayers where they are: The IRS will utilize a variety 

of platforms and messages to reach taxpayers from underserved communities and increase the 

share of taxpayers filing accurate returns and successfully claiming credits and incentives for 

which they are eligible.

• The IRS will expand staffing, availability, and services offered at Taxpayer Assistance 

Centers (TACs), Volunteer Income Tax Assistance (VITA) and Tax Counseling for the 

Elderly (TCE) centers, Low-Income Taxpayer Clinics (LITCs), refundable credit 

summits, and webinars. 

• The IRS will improve direct outreach to taxpayers through social media, podcasts, radio, 

television, and other channels. 

• The IRS will expand its partnerships with federal, state, and local government agencies, 

Tribal governments, private institutions, community-based organizations, and others to 

share information and distribute educational materials to help taxpayers access IRS 

services and claim the credits and deductions for which they are eligible.

Enhanced customer service and improved accessibility: The IRS will provide equal access to 

IRS services and opportunities for taxpayers, ensuring that customer service improvements are 

comparable across diverse taxpayer segments, including small businesses, rural populations, 

people with disabilities, those with limited English proficiency, and other underserved 

communities.

• When taxpayers reach out to IRS customer service, IRS employees will look holistically 

at taxpayers’ situations and ensure they are taking advantage of the credits and 

deductions for which they are eligible.
• All plain English notices will be translated into the top eight languages used by 

taxpayers. 

• Digital tools will be accessible for people with disabilities and available in taxpayers’ 

preferred languages. The IRS will develop best-in-class advanced analytics, including 

using techniques such as machine translation to improve taxpayer interactions in 

languages other than English.

New capabilities to correct taxpayer errors quickly and easily: By quickly resolving taxpayer 

issues at the front end and simplifying the process to amend returns, the IRS will reduce the gap 

between incentives owed and claimed.

• The IRS will use available third-party and internal data to systematically check e-filed 

returns for completeness and consistency and identify issues in real time. When 

applicable, the IRS will send notifications to taxpayers at the point of filing to help them 

correct errors and claim available credits and deductions. 

• Within the next two years, taxpayers and preparers will be notified about simple income 

and processing errors and missed or incorrectly claimed credits and deductions.

• The IRS will redesign all notices so that they clearly and briefly state the issues and 

outline steps needed to amend returns. By FY 2024, the IRS will create digital copies of 

72 notices so that taxpayers and authorized third parties can access them through their 

Online Accounts.

• Taxpayers will be able to resolve potential compliance issues up front through expanded 

pre-filing and tax certainty programs.

Monitor and address enforcement disparities and ensure wealthy taxpayers pay what they 

owe: The IRS will promote fairness in enforcement and increase enforcement activities to help 

ensure compliance of high-income and high-wealth individuals.

• The IRS will address the tax gap by pursuing wealthy and corporate tax evaders who 

have been able to skip out on their taxes while most taxpayers, including working 

families, pay what they owe.

• The IRS will hire experienced accountants, data analysts, and legal experts to ramp up 

enforcement at the top and ensure wealthy individuals, large corporations, and big 

partnerships pay the taxes they owe while not raising audit rates for small businesses and 

taxpayers making less than $400,000 above historical levels.

• The IRS will regularly evaluate the fairness of systems, selection tools and programs, 

compliance strategies, and treatments, and will make real-time adjustments to its 

approach to address disparate impacts on specific demographic populations, geographies, 

and customer categories.

Explore Direct File: Tax filing is the most common interaction most Americans have with the 

federal government, and it connects working families to critical resources like the CTC and 

EITC, but it's burdensome, time consuming, and expensive for most taxpayers. Currently, the 

average American spends 13 hours and $240 to complete their tax return. It’s no question that 

this disproportionately burdens our most underserved communities. A viable Direct File option 
would ease the burden on many taxpayers who would otherwise pay to file their taxes via thirdparty tax preparation services.

• The IRS will study the feasibility of building a Direct File service, making it easier for 

many taxpayers to prepare and file their tax returns for free directly with the IRS. This 

report will be issued in May 2023.

Along with IRS’ annual discretionary budget, the IRA investment over 10 years will transform 

the IRS so that it provides world class service to taxpayers, delivers refunds quickly, enforces tax 

laws with a focus among high earners and corporations, supports the IRA’s clean energy 

investments, and ensures that all Americans gain receive tax benefits for which they are eligible. 

These additional resources will not be used to increase the audit rates for small businesses and 

households making less than $400,000, relative to historical levels. The IRS is focused on 

pursuing high-income and high-wealth individuals, complex partnerships, and large corporations 

that are not paying the taxes they owe. Put together, the IRA is a historic investment in building 

an economy that works for everyone.

For Further Information:

• Strategic Operating Plan

• IRS.gov Tools

• Taxpayer Experience Days

• Taxpayer Online Account

• Tax Information in Non-English Languages