The Treasury Inspector General for Tax Administration

Program Summary by Budget Activity

Dollars in Thousands

 FY 2014 FY 2015 FY 2016 FY 2015 TO FY 2016

Budget Activity Enacted Enacted Request $ Change % Change

Audit $60,850 $61,572 $65,100 $3,528 5.73%

Investigations $95,525 $96,638 $102,175 $5,537 5.73%

Subtotal, Treasury Inspector General for 

Tax Administration $156,375 $158,210 $167,275 $9,065 5.73%

Offsetting Collections - Reimbursables $1,700 $1,500 $1,500 $0 0.00%

Total Program Operating Level $158,075 $159,710 $168,775 $9,065 5.68%

Direct FTE 835 835 859 24 2.87%

Reimbursable FTE 2 2 2 0 0.00%

Total FTE 837 837 861 24 2.87%

Summary

The FY 2016 President’s Budget request for 

the Treasury Inspector General for Tax 

Administration (TIGTA) will be used to 

provide high quality professional audit, 

investigative, and inspections and evaluations 

services that promote integrity, economy, and 

efficiency in the administration of the Nation’s 

tax system. 

TIGTA’s Fiscal Year 2013 – 2016 Strategic 

Plan guides program and budget activities and 

supports the Department of the Treasury’s 

FY 2014-2017 Strategic Plan (the Plan), which 

includes Strategic Goal 2: “Fairly and 

effectively reform and modernize Federal 

financial management, accounting, and tax 

systems.”

TIGTA’s vision is specifically consistent with 

objective 3.2 of the Plan, “Improve the 

disbursement and collection of Federal funds 

and reduce improper payments made by the 

U.S. Government.” Likewise, TIGTA’s vision

to “maintain a highly skilled, proactive, and 

diverse Inspector General organization dedicated 

to working in a collaborative environment with 

key stakeholders to foster and promote fair tax 

administration” supports objective 3.3 of the 

Plan, “Pursue tax reform, implement the 

Patient Protection and Affordable Care Act 

(ACA) and the Foreign Account Tax 

Compliance Act (FATCA), and improve the 

execution of the Internal Revenue Code (IRC 

or tax code).”

While there are a number of critical areas 

where TIGTA will provide oversight, FY 2016 

priorities include: 

• Identifying opportunities to improve the 

administration of the Nation’s tax laws and 

achieve program efficiencies and cost 

savings;

• Mitigating risks associated with: security 

of taxpayer data and employees; 

information systems modernization; 

identity theft; oversight of tax-exempt 

organizations; procurement fraud; tax 

compliance; implementation of tax law 

changes; and human capital challenges 

facing the IRS in its domestic and/or 

international operations;

• Providing the IRS with the investigative 

coverage and the information necessary to 

mitigate threats against its employees, 

facilities, and systems; 

• Responding to domestic and foreign 

threats to and attacks against IRS 
employees, property, data infrastructure, 

and sensitive information;

• Rapidly and effectively responding to 

attempts to impersonate the IRS for 

fraudulent purposes;

• Improving the integrity of IRS operations 

by detecting and deterring waste, fraud, 

abuse, and misconduct, including the 

unauthorized disclosure of confidential 

taxpayer information by IRS employees; 

• Conducting comprehensive audits and 

inspections and evaluations that provide 

recommendations for achieving monetary 

benefits; addressing erroneous and 

improper payments; and enhancing the 

service the IRS provides to taxpayers; 

• Informing the American people, Congress, 

and the Secretary of the Treasury of 

problems on a timely basis once all facts 

are known;

• Overseeing the IRS’s efforts to administer 

tax provisions of the Patient Protection and 

Affordable Care Act (ACA); as amended 

by the Health Care and Education 

Reconciliation Act of 2010; and

• Overseeing the IRS’s efforts to implement 

the Foreign Account Tax Compliance Act 

(FATCA) to help prevent U.S. taxpayers 

from hiding assets offshore.

TIGTA was created by Congress as a part of 

the Internal Revenue Service Restructuring 

and Reform Act of 1998 (RRA 98). TIGTA’s 

audits, investigations, inspections, and 

evaluations protect and promote the fair 

administration of the U.S. tax system. TIGTA 

conducts audits that advise the public, 

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 

improve the administration of the Federal tax 

system. TIGTA’s administrative and criminal 

investigations help to protect the IRS and its 

employees and to ensure that the IRS protects 

and secures taxpayers’ data. TIGTA’s 

inspections and evaluations services provide 

responsive, timely, and cost-effective 

inspections and evaluations of IRS challenge 

areas. TIGTA’s oversight is essential to the 

efficiency and equity of the IRS’s tax 

administration system. TIGTA ensures that 

taxpayers can have confidence that the IRS 

collects more than $3.1 trillion in tax revenue 

in an effective and efficient manner. 

Total resources required to support TIGTA 

activities for FY 2016 are $168,775,000, 

including $167,275,000 from direct 

appropriations and $1,500,000 from offsetting 

collections and reimbursable programs.

TIGTA FY 2016 Budget Highlights

Dollars in Thousands

Treasury Inspector General for Tax 

Administration FTE Amount

FY 2015 Enacted 835 $158,210

Changes to Base:

Maintaining Current Levels (MCLs): - $2,557

Pay-Raise - $1,249

Pay Annualization - $319

FERS Contribution Increase - $426

Non-Pay - $563

Efficiency Savings: - ($84)

Personnel Security Background 

Investigations - ($17)

Space Optimization - ($67)

Subtotal Changes to Base - $2,473

Total FY 2016 Base 835 $160,683

Program Changes:

Program Increases: 24 $6,592

Enhance Capabilities to Protect the Tax 

Administration System Against Fraud & 

Cyberthreats 24 $6,592

Total FY 2016 Request 859 $167,275

FY 2016 Budget Adjustments

Adjustments to Request

Maintaining Current Level (MCLs)

Pay-Raise +$1,249,000 / +0 FTE

Funds are requested for the proposed January 

2016 pay-raise.

Pay Annualization +$319,000 / +0 FTE

Funds are requested for annualization of the 

January 2015 pay-raise.
FERS Contribution Increase +$426,000 / 

+0 FTE

Funds are requested for increases in agency 

contributions to the Federal Employee 

Retirement System based on updated actuarial 

estimates.

Non-Pay +$563,000 / +0 FTE

Funds are requested for inflation adjustments 

in non-labor costs such as travel, contracts, 

rent, and equipment.

Efficiency Savings

Personnel Security Background 

Investigations -$17,000 / +0 FTE

TIGTA will generate a savings from a 

reduction in the number of personnel 

investigations it will need to conduct based on 

the results of an ongoing position sensitivity 

designation review.

Space Optimization -$67,000 / +0 FTE

TIGTA will achieve real property cost savings 

through the reduction of space, non-renewal of 

lease agreements, and/or the consolidation of 

existing space. TIGTA continues to 

implement telework and office right-sizing 

measures in order to reduce its footprint. As a 

result, TIGTA will need less building space, 

generating a savings of $67,000.

Program Increases

Enhance Capabilities to Protect the Tax 

Administration System Against Fraud & 

Cyberthreats +$6,592,000 / +24 FTE

The threats to the Nation’s tax system are 

growing in complexity and sophistication. 

TIGTA developed this initiative to improve its 

use of advanced analytics and cross-discipline 

approaches to enhance its capabilities to assess 

and protect the Federal tax system.

Explanation of Budget Activities

Audit ($65,100,000 from direct 

appropriations, $600,000 from reimbursable 

resources)

TIGTA’s audit work is concentrated on highrisk areas and the IRS’s progress in achieving 

its strategic goals. TIGTA strategically 

evaluates IRS programs, activities, and 

functions so that resources are expended in the 

areas of highest vulnerability to the Nation’s 

system of tax administration. TIGTA’s audit 

program includes both statutory audit 

requirements and specific audits identified 

through TIGTA’s risk-assessment process. By 

focusing on the most critical areas, TIGTA 

identifies and recommends improvements that 

add value while addressing high-risk tax 

administration issues. TIGTA’s audits and 

recommendations help promote the economy, 

efficiency, and effectiveness of IRS programs; 

ensure the fair and equitable treatment of 

taxpayers; and detect and deter waste, fraud, 

and abuse.

During FY 2014, TIGTA issued 95 audit 

reports that included potential financial 

benefits of approximately $16.5 billion and 

affected approximately 3.6 million taxpayer 

accounts. In FY 2014, several key ACA 

provisions became effective. Beginning in 

Calendar Year 2014, most individuals are 

required to maintain minimum essential 

coverage and some low to middle income 

individuals will be eligible to receive the 

Premium Tax Credit. As such, FY 2015 and 

FY 2016 will be significant years for oversight 

of ACA provisions. TIGTA’s independent 

oversight plays a key role in ensuring that 

these provisions are implemented and 

administered in accordance with the law and 

the intent of Congress.
Investigations ($102,175,000 from direct 

appropriations $900,000 from reimbursable 

resources)

TIGTA has a 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 serious 

administrative and criminal misconduct 

committed by IRS employees. TIGTA’s 

investigative resources focus on three primary 

areas of investigation: Employee Integrity;

Employee and Infrastructure Security; and

External Attempts to Corrupt Tax 

Administration. 

Employee Integrity: IRS employee 

misconduct, real or perceived, can erode 

public trust and impede the IRS’s ability to 

enforce tax laws effectively. This misconduct 

manifests itself in a variety of ways, including: 

misuse of IRS resources or authority; theft; 

fraud; extortion; taxpayer abuses; and 

unauthorized access to, and disclosure of, tax 

return information. During FY 2014, 54 

percent of TIGTA’s investigative body of 

work involved alleged employee misconduct. 

TIGTA’s special agents possess the 

knowledge, skills, and expertise to investigate 

such matters. TIGTA’s investigation of 

employee misconduct conveys a message to 

IRS employees that these types of activities 

will not go unchecked. TIGTA promotes 

employee integrity by conducting proactive 

investigative initiatives to detect criminal 

activity and other serious misconduct in the 

administration of IRS programs. 

Employee and Infrastructure Security: 

Physical violence, harassment, and 

intimidation of IRS employees pose some of 

the most significant challenges to the 

implementation of a fair and effective system 

of tax administration. TIGTA’s investigative 

efforts place high priority on its oversight of 

IRS employee safety and physical security, 

protecting approximately 95,000 employees 

and 670 facilities throughout the country. 

TIGTA maintains IRS employee and 

infrastructure security by conducting 

investigations into incidents that threaten IRS 

employees, facilities, and infrastructure. In 

October 2008, the Inspector General Reform 

Act of 2008 was signed into law, which allows 

TIGTA to provide physical security to protect 

IRS employees against external threats. 

TIGTA works aggressively and takes swift 

action to protect IRS employees; including 

providing armed escorts to IRS employees in 

dangerous situations.

External Attempts to Corrupt Tax 

Administration: TIGTA is statutorily 

mandated to investigate external attempts to 

corrupt tax administration, which includes 

criminal misconduct by non-employees such 

as attempted bribery of IRS employees and the 

impersonation of the IRS. Many IRS 

employees are in direct contact with taxpayers 

and often encounter situations where a 

taxpayer may challenge the employee’s 

integrity with a bribe. Bribery, or attempted 

bribery, of a public official is a criminal 

offense, and an attack on the integrity of the 

entire IRS organization and the Nation’s 

system of tax administration. TIGTA is 

currently investigating nationwide IRS 

impersonations schemes in which criminals 

are pretending to be IRS employees and are 

attempting to collect phantom tax liabilities 

from innocent taxpayers. To date, the TIGTA 

Hotline has received over 269,000 related 

reports of this type of contact; and over 2,400 

taxpayers have been defrauded out of over $13 

million as a result of this impersonation scam.

Legislative Proposals

TIGTA has no legislative proposals.
TIGTA Performance by Budget Activity

Budget Activity Performance Measure FY 2012 FY 2013 FY 2014 FY 2015 FY 2016

Actual Actual Actual Target Target

Audit Percentage of Audit Products 

Delivered when Promised to 

Stakeholders

71.0 84.0 65.0 68.0 68.0

Audit Percentage of Recommendations 

Made that Have Been 

Implemented

94.0 87.0 89.0 85.0 85.0

Investigations Percentage of Results from 

Investigative Activities

89.0 90.0 92.0 79.0 81.0

Key: DISC - Discontinued and B - Baseline

Description of Performance

• For FY 2014, TIGTA issued 95 audit 

reports identifying approximately 

$16.5 billion in potential financial benefits 

(i.e., costs savings, increased or protected 

revenue, taxpayer rights and entitlements, 

and inefficient use of resources).

• For FY 2014, TIGTA achieved its 

FY 2014 target of 65 percent for the 

percentage of audit products delivered 

when promised to stakeholders. TIGTA 

met this goal as a result of monitoring the 

execution of its audit programs. The FY 

2014 actual percentage of 

recommendations made that have been 

implemented was 89 percent. TIGTA 

exceeded its target by four percent as a 

result of continued discussions with the 

IRS throughout the audit process, both on 

the findings and on the potential 

recommended solutions, to ensure that 

feasible alternatives were identified.

• For FY 2016, the Office of Audit targets 

68 percent of audit products will be 

delivered when promised to stakeholders 

and 85 percent of recommendations made 

will be implemented.

 

• During FY 2014, TIGTA initiated 41 

proactive investigative initiatives to detect 

systemic weaknesses or potential IRS 

program vulnerabilities. TIGTA received 

10,193 complaints and opened 2,964 

investigations in FY 2014. During this 

time period, TIGTA also closed 3,054 

investigations, which included 1,343 cases 

of employee misconduct referred for IRS 

action and 144 cases of all types of 

investigations were accepted for criminal 

prosecution. 

• For FY 2016, the Office of Investigations’ 

performance target is 81 percent, a two 

percent increase from the FY 2015 target 

of 79 percent.