Inspector General for Tax Administration 

Program Summary by Budget Activity 

(Dollars in thousands) 

FY 2008 FY 2009 FY 2010 Appropriation Enacted ARRA Enacted Request $ Change % Change

Salaries and Expenses $140,533 $7,000 $146,083 $149,000 $2,917 2.0%

 Audit $52,959 $5,600 $55,186 $56,289 $1,103 2.0%

 Investigations $87,574 $1,400 $90,897 $92,711 $1,814 2.0%

Subtotal, Inspector General for Tax 

Administration $140,533 $7,000 $146,083 $149,000 $2,917 2.0%

Offsetting Collections - Reimbursables $900 $0 $900 $1,300 $400 44.4%

Total Program Operating Level $141,733 $7,000 $146,983 $150,300 $3,317 2.3%

Explanation of Request 

 

The FY 2010 President’s Budget request for 

Treasury Inspector General for Tax 

Administration (TIGTA) will be used to 

continue to provide critical audit, 

investigative, and inspection and evaluation 

services, promoting the integrity of tax 

administration on behalf of the Nation’s 

taxpayers. While there are a number of critical 

areas where TIGTA will provide oversight, 

highlights of TIGTA’s investigative and audit 

priorities include: 

• Adapting to the Internal Revenue Service’s 

(IRS) continuously evolving operations 

and mitigating intensified risks associated 

with modernization, security, addressing 

the tax gap, and human capital challenges 

facing the IRS; 

• Responding to threats and attacks against 

IRS employees, property, and sensitive 

information; 

• Improving the integrity of IRS operations 

by detecting and deterring fraud, waste, 

abuse and misconduct by IRS employees; 

• Conducting comprehensive audits, 

inspections, and evaluations that include 

recommendations for monetary benefits 

and enhancing IRS’ service to taxpayers; 

and 

• Informing the American people, Congress, 

and the Secretary of the Treasury of 

problems and progress made to resolve 

them. 

Total resources required in FY 2010 to support 

TIGTA’s mission are $150,300,000, including 

$149,000,000 from direct appropriations, and 

approximately $1,300,000 from reimbursable 

agreements. 

Purpose of Program 

 

The Treasury Inspector General for Tax 

Administration (TIGTA) was created by 

Congress as a part of the Internal Revenue 

Service Restructuring and Reform Act of 1998 

(RRA 98). TIGTA’s audits and investigations 

protect and promote the fair administration of 

the American tax system. TIGTA conducts 

audits that advise the American people, 

Congress, the Secretary of the Treasury, and 

IRS management of high-risk issues, 

problems, and deficiencies related to the 

administration of IRS programs and 

operations. TIGTA’s audit recommendations 

aim to improve IRS systems and operations, 

while maintaining fair and equitable treatment 

of taxpayers. TIGTA’s investigations ensure 

the integrity of IRS employees, contractors, 

and other tax professionals; provide for 

infrastructure security; and protect the IRS 

from external attempts to threaten or corrupt 

Department of the Treasury - Budget in Brief FY 2010 Page 27
the administration of the tax laws. TIGTA’s 

Office of Inspections and Evaluations (I&E) 

provides responsive, timely, and cost-effective 

inspections and evaluations of IRS challenge 

areas. TIGTA’s oversight is essential to the 

efficiency and equity of the Federal tax 

administration system. TIGTA ensures that 

the American taxpayer can have confidence 

that the IRS collects nearly $3 trillion in tax 

revenue in an effective and efficient manner 

using a system which is just and equitable. 

TIGTA FY 2010 Budget Highlights

(Dollars in thousands) 

Appropriation Amount

FY 2009 Enacted 146,083

Changes to Base: 

Maintaining Current Levels (MCLs): $3,264

Across the Board Program Reduction (504)

Non-Pay Inflation Adjustment 318

Pay Annualization 1,110

Pay Inflation Adjustment 2,340

Non-Recurring Costs: ($347)

No obligation to fund CIGIE (347)

Subtotal FY 2010 Changes to Base $2,917

Total FY 2010 Base 149,000

Total FY 2010 President's Budget Request 149,000

FY 2010 Budget Adjustments 

 

FY 2009 Enacted 

The FY 2009 enacted direct appropriation for 

TIGTA is $146,083,000. 

Maintaining Current Levels (MCLs) 

Adjustments Necessary to Maintain 

Current Levels +$3,264,000 / +0 FTE Funds 

are requested for: FY 2010 cost of the January 

2009 pay increase of $1,110,000; proposed 

January 2010 pay raise of $2,340,000; and 

non-labor related items such as contracts, 

travel, supplies, equipment and GSA rent 

adjustments of $318,000. 

Non-Recurring Costs 

No obligation to fund CIGIE -$347,000 / +0 

FTE There will be no interagency funding 

provided for the Council of Inspectors General 

on Integrity and Efficiency (CIGIE) in this 

request. 

Explanation of Budget Activities 

 

Salaries and Expenses 

 

Audit ($56,289,000 from direct 

appropriations and $551,000 from 

reimbursable programs) The Office of 

Audit’s (OA) mission is to provide 

comprehensive coverage and oversight of all 

aspects of the IRS’ daily operations. Audits, 

inspections, and evaluations not only focus on 

the economy and efficiency of IRS functions 

but also ensure that taxpayers’ rights are 

protected and the taxpaying public is 

adequately served. Moreover, the IRS’ 

implementation of audit recommendations 

results in: cost savings and increased or 

protected revenue; reduction of taxpayer 

burden; protection of taxpayer rights and 

entitlements, taxpayer privacy and security; 

and protection of IRS resources. Overall, as of 

September 30, 2008, audit reports produced 

potential financial benefits of approximately 

$2.4 billion, and potentially impacted 

approximately 5.7 million taxpayer accounts in 

areas such as taxpayer burden, rights and 

entitlements, taxpayer privacy and security, 

protection of resources/reliability of 

information, and increased revenue/revenue 

protected. Each fiscal year, OA develops an 

annual audit plan that communicates oversight 

priorities to Congress, the Department of the 

Treasury, and the IRS. This plan strikes a 

balance between statutory audit coverage and 

high risk audit work. The statutory coverage 

includes audits mandated by the IRS 

Restructuring and Reform Act of 1998, as well 

as reviews that address computer security and 

financial management. The high-risk 

workload includes issues pertaining to the IRS' 

modernization efforts, its major management 

challenges, its progress in achieving its 

strategic goals, as well as Congressional and 

other stakeholder requests for audit coverage. 

Department of the Treasury - Budget in Brief FY 2010 Page 28
Investigations ($92,711,000 from direct 

appropriations and $749,000 from 

reimbursable programs) While most Offices 

of Inspector General focus primarily on fraud, 

waste and abuse, TIGTA’s mission is more 

extensive. TIGTA has the statutory 

responsibility to protect the integrity of tax 

administration and to protect the ability of the 

IRS to collect revenue for the federal 

government. To accomplish this, TIGTA 

investigates allegations of criminal violations 

and administrative misconduct by IRS 

employees, protects the IRS against external 

attempts to corrupt tax administration, and 

ensures IRS employee safety and IRS data and 

infrastructure security. The following 

summaries highlight TIGTA’s investigative 

efforts in these three core areas: 

Employee Integrity: The IRS’ ability to 

deliver taxpayer service, enforce tax laws 

effectively, and collect the proper amount of 

taxes can be undermined by employee 

misconduct. Over 50 percent of TIGTA’s 

current investigations involve alleged 

employee misconduct. These investigations of 

employee misconduct allegations include 

extortion, theft, taxpayer abuse, false 

statements, and financial fraud. In addition, an 

integral part of the employee integrity program 

involves investigations of unauthorized access 

to confidential taxpayer records by IRS 

employees. 

Employee and Infrastructure Security: In 

1998, The President of the United States 

designated IRS operations as a critical 

infrastructure.1

 TIGTA meets the challenge of 

maintaining IRS employee and infrastructure 

security by conducting investigations in 

reaction to incidents in which IRS employees, 

facilities, and infrastructure are sabotaged, 

threatened, or assaulted. Potential threats to 

tax administration are identified by TIGTA’s 

administration of a Criminal Intelligence 

 

1 Presidential Decision Directive NSC-63.

Program that utilizes law enforcement and 

intelligence resources to proactively identify 

individuals and groups who may pose a threat 

to tax administration. 

External Attempts to Corrupt Tax 

Administration: External attempts to corrupt 

tax administration impede the IRS’ ability to 

collect revenue. TIGTA’s investigations of 

external attempts to corrupt or interfere with 

tax administration include: bribes offered by 

taxpayers to compromise IRS employees; the 

use of fraudulent IRS documentation to 

commit crimes; taxpayer abuse by tax 

practitioners; impersonation of IRS 

employees; and the corruption of IRS 

programs through procurement fraud. 

Legislative Proposals 

 

TIGTA has no legislative proposals for FY 

2010. 

Department of the Treasury - Budget in Brief FY 2010 Page 29
TIGTA Performance by Budget Activity 

FY 2006 FY 2007 FY 2008 FY 2009 FY 2010

Budget Activity Performance Measure Actual Actual Actual Target 

Met? ARRA Target Target

Investigations Percentage of results from 

investigative activities (%) (Oe) 

79 81 78 Yes 78 78 78 

Audit Percentage of audit products delivered 

when promised to stakeholders (%) 

(Oe) 

0 68 65 Yes 65 65 65 

Audit Percentage of recommendations made 

that have been implemented (%) (Oe) 

0 90 85 Yes 83 83 83 

Key: Oe - Outcome Measure, E - Efficiency Measure, Ot - Output/Workload Measure, and M - Management/Cust. Satisfaction 

Description of Performance 

 

• Issued 179 audit, inspection, and 

evaluation reports, identifying 

approximately $2.4 billion in potential 

financial benefits (i.e., costs savings, 

increased or protected revenue, taxpayer 

rights and entitlements, and inefficient 

use of resources). 

• Closed 78 percent of the 3,662 final 

closed investigations which generated 

results, including 1,569 cases of 

employee misconduct referred for action 

and 179 cases accepted for criminal 

prosecution with final legal action. 

Department of the Treasury - Budget in Brief FY 2010 Page 30