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Fiscal Year 

Publication 4450 (Rev. 2-2023) Catalog Number 39720Z Department of the Treasury Internal Revenue Service www.irs.gov

Congressional 

Budget Justification

& 

Annual Performance 

Report and Plan

2024
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Table of Contents

Commissioner’s Message.............................................................................................................. 1

Section I – Budget Request........................................................................................................... 3

A – Mission Statement .............................................................................................................. 3

1.1 – Appropriations Detail Table ........................................................................................... 3

1.2 – Inflation Reduction Act Implementation ....................................................................... 8

B – Summary of the Request.................................................................................................. 10

1.3 – Budget Adjustments Table ............................................................................................ 11

C – Base Adjustment and Program Changes Description................................................... 12

Maintaining Current Levels................................................................................................... 12

Pay Annualization (4.6%) ..................................................................................................... 12

Pay Raise (5.2%)................................................................................................................... 12

Non-Pay................................................................................................................................. 12

Base Adjustment...................................................................................................................... 12

FERS Law Enforcement Rate Increase ................................................................................. 12

Improve Competitiveness of IRS Clerical Staff ..................................................................... 12

Change in Staffing Designation............................................................................................. 13

Program Increases................................................................................................................... 13

Strategies for Improving the Taxpayer Experience............................................................... 13

Green Tax Credit Implementation......................................................................................... 14

Improve Telephone Level of Service and Reduce Correspondence Inventory ...................... 14

Restoration of Staffing Levels................................................................................................ 16

Fleet Electrification............................................................................................................... 16

Sustainment of Deployed IT Capabilities.............................................................................. 17

Sustaining Infrastructure....................................................................................................... 18

Business Systems Modernization........................................................................................... 18

Sustainable and Resilient Buildings...................................................................................... 19

1.4 – Object Classification (Schedule O) Obligations .......................................................... 20

D – Appropriations Language and Explanation of Changes .............................................. 21

Section II – Budget and Performance Plan .............................................................................. 28

A – Strategic Alignment.......................................................................................................... 28

Taxpayer Services ................................................................................................................... 30

2.1 – Budget Adjustments Table........................................................................................... 31

2.2 – Object Classification Obligations................................................................................ 32

2.3 – Appropriation Detail Table ......................................................................................... 33

2A – Pre-Filing Taxpayer Assistance and Education......................................................... 33

2.1.1 – Budget and Performance Report and Plan ............................................................. 36

2B – Filing and Account Services........................................................................................ 37

2.1.2 - Budget and Performance Report and Plan .............................................................. 41

Enforcement............................................................................................................................. 41
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2.1 – Budget Adjustments Table........................................................................................... 42

2.2 – Object Classification Obligations................................................................................ 43

2.3 – Appropriation Detail Table ......................................................................................... 44

2C – Investigations............................................................................................................... 44

2.1.3 – Budget and Performance Report and Plan ............................................................. 47

2D – Exam and Collections.................................................................................................. 47

2.1.4 – Budget and Performance Report and Plan ............................................................. 52

2E – Regulatory .................................................................................................................... 52

2.1.5 – Budget and Performance Report and Plan ............................................................. 54

Operations Support................................................................................................................. 55

2.1 – Budget Adjustments Table........................................................................................... 55

2.2 – Object Classification Obligations................................................................................ 56

2.3 – Appropriation Detail Table ......................................................................................... 57

2F – Infrastructure............................................................................................................... 57

2.1.6 – Budget and Performance Report and Plan ............................................................. 60

2G – Shared Services and Support....................................................................................... 60

2.1.7 – Budget and Performance Report and Plan ............................................................. 64

2H – Information Services................................................................................................... 64

2.1.8 – Budget and Performance Report and Plan ............................................................. 68

Business Systems Modernization ........................................................................................... 68

2.1 – Budget Adjustments Table........................................................................................... 68

2.2 – Object Classification Obligations................................................................................ 69

2.3 – Appropriation Detail Table ......................................................................................... 69

2I – Business Systems Modernization.................................................................................. 70

2.1.9 – Budget and Performance Report and Plan ............................................................. 74

B – Business Systems Modernization .................................................................................... 75

C – Changes in Performance Measures ................................................................................ 77

Section III – Supplemental Information................................................................................... 78

3.1 – Summary of Capital Investments ................................................................................. 78

3.2 – IRS Performance Measures Table................................................................................ 84

3.3 – Return on Investment (ROI) for IRS Major Enforcement Programs ...................... 86

Section IV – Appendix................................................................................................................ 87

4.1 - COVID-19 Supplemental Funding................................................................................ 87

4.2 – Summary of IRS FY 2024 Cybersecurity Budget Request ........................................ 87

4.3 – Summary of IRS FY 2024 Budget Request.................................................................. 88
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Commissioner’s Message

In FY 2022, the Internal Revenue Service (IRS) collected more than $4.9 

trillion in taxes, approximately 96-97% of all Federal revenues. In addition 

to monies collected, the IRS paid out more than $600 billion in tax refunds, 

credits, and other payments, demonstrating we are much more than a tax 

administration agency. Our efforts make it possible for the government to 

effectively perform vital functions and support the United States in all 

areas, from education to defense. Given the importance of the IRS to the 

nation, I believe it is imperative the agency remain in a strong position, 

with greater resources to support its mission.

We are intently focused on implementing new and innovative strategies to improve the taxpayer 

experience and help us enforce tax laws with integrity and fairness to all. We opened the 2022 filing 

season on January 24, 2022, two weeks earlier than in 2021. We issued $360 billion in refunds to 110 

million individual taxpayers who filed tax year 2021 returns last calendar year. Thus far in the 2023 filing 

season, the IRS has also hired 5,000 new customer service representatives resulting in a higher number of 

calls answered, processed historic levels of inventory in the 12 months preceding start of filing season 

2023, and is on track to triple the number of taxpayers served at Taxpayer Assistance Centers by next 

year. While we continue to advance our services and operations to meet stakeholders’ needs, we 

recognize that we have much work to do to improve taxpayer service, prevent future return processing 

backlogs, continue to protect, and modernize IRS systems, and support voluntary compliance. 

We are grateful for the recent enactment of the substantial multi-year funding provided in Public Law 

117-169, The Inflation Reduction Act of 2022 (IRA). This historic funding marks a transformational 

moment for our agency and an opportunity for the future of tax administration, taxpayers, tax 

professionals, and IRS employees. These funds will allow the IRS to significantly improve service to 

taxpayers and expand its enforcement reach to address large corporate and global high-net-worth 

taxpayers, as well as pass-through entities and multinational taxpayers with international tax issues. 

Resources provided by IRA will reduce the tax gap driven by high-income individuals making more than 

$400,000 per year and large corporations. Consistent with Secretary Yellen’s directive to the Internal 

Revenue Service, audit rates will not increase, relative to historic levels, for small businesses or taxpayers 

earning less than $400,000 per year. These resources will similarly grant us the opportunity to accelerate 

our IT modernization and digitalization priorities. We are already working to implement the wide range of 

tax law changes in the IRA, and we are also developing strategic plans to implement this funding in the 

most effective and responsible manner. The IRA Strategic Operating Plan, which describes IRS’s 

intentions for these new resources, will be released soon.

The IRS has struggled for many years with resources insufficient to modernize and fulfill our important 

mission. Resource constraints not only affected our capacity to deliver stellar tax administration 

but further limited our ability to provide services to taxpayers in the manner they expect and deserve. 

While we deeply appreciate the multi-year funding in the IRA, enhanced annual discretionary 

appropriations are still critical to improve taxpayer services and cover normal IRS operations. Without 
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this continued investment, IRA resources will be diverted away from transformative projects and 

activities to cover basic operations. That scenario would mean worse service for the American taxpayer 

and higher levels of tax evasion by the wealthy and large corporations. It would also significantly 

decrease the deficit reduction impacts of the IRA.

Maintaining a strong workforce, maintaining proper support functions, and ensuring flexible, robust 

service channels for taxpayers are top priorities and the premise of this budget request. In addition to 

increased hiring flexibility so we may staff the agency with the right people when and where we need 

them, the IRS needs healthy annual discretionary funding appropriated to meet taxpayer expectations and

ultimately the needs of our country.

We are making progress and want to continue successfully pursuing our mission on behalf of this great 

country.

Doug O’Donnell

Deputy Commissioner Services and Enforcement
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Section I – Budget Request 

A – Mission Statement

Provide America’s taxpayers top-quality service by helping them understand and meet their tax 

responsibilities and enforce the law with integrity and fairness to all.

1.1 – Appropriations Detail Table

1 The FY 2022 Operating Plan includes an Inter-Appropriation Transfer amount of $74 million from Enforcement to Taxpayer Services ($27 million) and 

Operations Support ($47 million). It does not include $29.7 million of Ukraine supplemental funding enacted via P.L. 117-128 and does not include COVID 

supplemental funding.

2 FY 2022 Other Resources and Full-Time Equivalents (FTE) represent actuals. 3 The FY 2023 Enacted level does not include COVID supplemental funding or the proposed Inter-Appropriation Transfer from Enforcement ($271.9 million) 

to Taxpayer Services ($100 million), Business Systems Modernization ($150 million), and Operations Support ($22 million).

4 FY 2023 Enacted may differ slightly from the amounts reported in the IRS FY 2023 Operating Plan due to timing of legislative actions and agency decisions. 5 FY 2022 IRA Funding Usage includes amounts for Taxpayer Services ($1 million), Operations Support ($61 million), and Business Systems Modernization 

($44 million).

6 85 percent of the IRA funded estimated FTE levels support non-Enforcement activities. FY 2023 IRA Funding Usage includes amounts for Direct e-File ($15 

million), Taxpayer Services ($838 million and 7,394 FTE), Enforcement ($372 million and 1,543 FTE), Operations Support ($1,018 million and 727 FTE), and 

Business Systems Modernization ($580 million and 357 FTE).

7 63 percent of the IRA funded estimated FTE levels support non-Enforcement activities. FY 2024 IRA Funding Usage includes amounts for Energy Security 

tax credits ($180 million and 1,810 FTE), Taxpayer Services ($816 million and 6,489 FTE), Enforcement ($1,408 million and 7,239 FTE), Operations Support 

($2,380 million and 3,810 FTE), and Business Systems Modernization ($1,034 million and 197 FTE). 8 Resources from Other Accounts reflect planned spending from Private Collection Agency retained earnings.

9 In FY 2023 and FY 2024 IRS is expected to lose more than 8,000 employees per year from retirements and losses to the agency. If unable to backfill these 

losses, IRS FTE would decline by nearly 6,000 FTE per year. 

Dollars in Thousands

Internal Revenue Service

Appropriated Resources

New Appropriated Resources FTE AMO UNT FTE AMO UNT FTE AMO UNT FTE AMO UNT

Taxpayer Services 26,698 $2,807,606 26,881 $2,780,606 31,585 $3,422,449 17.5% 23.1%

Pre-Filing Taxpayer Assistance and Education 4,337 680,261 4,985 784,380 5,018 823,344 0.7% 5.0%

Filing and Account Services 22,361 2,127,345 21,896 1,996,226 26,567 2,599,105 21.3% 30.2%

Enforcement 35,550 $5,363,622 34,340 $5,437,622 34,890 $5,904,441 1.6% 8.6%

Investigations 3,004 700,876 3,076 744,590 3,130 818,021 1.8% 9.9%

Exam and Collections 31,599 4,447,716 30,320 4,521,758 30,735 4,897,493 1.4% 8.3%

Regulatory 947 215,030 944 171,274 1,025 188,927 8.6% 10.3%

Operations Support 10,133 $4,147,826 11,406 $4,100,826 11,506 $4,520,076 0.9% 10.2%

Infrastructure 925,539 922,682 1,053,129 14.1%

Shared Services and Support 5,233 1,179,189 5,097 1,164,430 5,113 1,232,149 0.3% 5.8%

Information Services 4,900 2,043,098 6,309 2,013,714 6,393 2,234,798 1.3% 11.0%

Business Systems Modernization 267 $275,000 197 $289,619

Subtotal New Appropriated Resources 72,648 $12,594,054 72,627 $12,319,054 78,178 $14,136,585 7.6% 14.8%

O ther Resources

Reimbursable 521 127,319 698 168,000 734 176,400 5.2% 5.0%

Offsetting Collections (Non-reimbursable) 29,687 33,836 35,625 5.3%

User Fees 85 413,082 86 31,827 71 3,900 -17.4% -87.7%

Recoveries from Prior Years 24,294 53,633 53,633 0.0%

Unobligated Balances from Prior Years 6,338 1,518,612 1,843 884,175 259,000 -100.0% -70.7%

IRA Funding Usage567 105,962 10,021 2,822,260 19,545 5,818,533 95.0% 106.2%

Transfers In/Out 85 119 119 0.0%

Resources from Other Accounts8 414 114,272 469 161,471 469 161,471 0.0% 0.0%

Subtotal O ther Resources 7,358 $2,333,313 13,117 $4,155,321 20,819 $6,508,681 58.7% 56.6%

Total Budgetary Resources9 80,006 $14,927,367 85,744 $16,474,375 98,997 $20,645,266 15.5% 25.3%

% Change

FY 2022 FY 2023 FY 2024 FY 2023 to FY 2024

O perating Plan1 2 Enacted3 4 Request
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Introduction 

The IRS Fiscal Year (FY) 2024 Budget Request (Budget) is $14.1 billion, $1.8 billion (15 percent) more 

than the FY 2023 Enacted level of $12.3 billion. The Budget includes initiatives to improve taxpayers’

experience with the IRS, ultimately leading to increased voluntary tax compliance and reduced

correspondence inventory. To support increased enforcement activity funded through the IRA, annual 

discretionary appropriations need to provide sufficient recurring “base” resources to cover current service 

levels for the Enforcement and Operations Support accounts, including inflationary increases. While 

funding for Taxpayer Services and Business Systems Modernization (BSM) does not directly generate 

additional revenue, the modernization of IRS systems, expanded enforcement reach to address large 

corporate and global high-net-worth taxpayers, and transformation of the taxpayer experience can 

similarly only be achieved if base funding is maintained. 

The Budget aims to fortify taxpayer services and operational efforts that will enable the IRS to deliver 

improved and sustained phone service along and lower correspondence inventory levels. It proposes to 

ensure improved telephone and in-person service and accelerate the development of digital tools to enable 

smarter communication with taxpayers. In addition, the Administration supports incremental funding 

increases to supplement limited IRA funding for Taxpayer Services, sustain deployed IT system 

enhancements, combat climate change, and promote evidence-based policy making.

An enforcement program with the capabilities to address large corporate and global high net-worth 

taxpayers will generate and protect billions in additional revenue while reducing the tax gap. The IRS has 

an overall enforcement return on investment (ROI) of about $6 for every $1 invested compared to the IRS 

appropriated budget, before considering the significant deterrence effects. Overall, this request proposes 

new and enhanced strategies for refining how the taxpayer interacts with the IRS by implementing 

approaches that put taxpayers first, bringing services to underserved communities, and providing new and 

improved online tools for taxpayers to communicate with the IRS easily and quickly.

An appropriate level of funding will allow the IRS to continue enhancing the taxpayer experience, ensure 

the IRS can use IRA funding effectively, protect IRS systems and taxpayer data, and modernize IRS

information technology systems. Taxpayer Services is only one component of funding required to serve 

taxpayers effectively. During the pandemic, for example, the Information Technology (IT) division, 

which is funded primarily by the Operations Support appropriation, provided the equipment necessary to 

allow thousands of IRS customer service representatives to telework, which enabled phone assistance to 

continue during a period of overwhelming demand while keeping employees safe.

The IRS dedicates itself to improving the taxpayer experience so that taxpayers and their representatives 

can understand and meet their tax obligations with minimal burden. The aim is to increase voluntary 

compliance by simplifying the tax filing, correction, and payment processes. To help achieve this, the IRS

will direct resources towards improving education and outreach on taxpayer rights and obligations and 

enhancing service channels to meet taxpayer needs. In addition to improving the taxpayer experience, 

another priority to advance fairness in tax administration is to ensure taxpayers comply with federal tax 

laws. To this effect, the IRS will continue to develop innovative approaches to understanding, detecting, 

and resolving potential noncompliance to maintain taxpayer confidence in the tax system.

We are grateful for the recent enactment of the robust multi-year funding provided in the Inflation 

Reduction Act (IRA), P.L. 117-169, which supplements the IRS’s existing discretionary budget. This 

funding marks a historic opportunity to transform the administration of the tax system and the customer 

service the IRS provides to taxpayers. Years of underfunding left the IRS unable to deliver the modern 
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customer service experience taxpayers deserve, operating on outdated IT systems that failed to keep up 

with a changing economy, and without the tax specialists or data scientists the agency needs to ensure 

wealthy and corporate tax evaders pay what they owe, necessitating a mandatory investment to transform 

the IRS and bring it from lagging to leading. But those investments can only be put to work if the IRS

also continues funding the ongoing, annual, steady-state maintenance of the agency’s operations. 

Otherwise, the funding for the IRS to transform will be consumed covering IRS basic operational needs. 

Resources provided by IRA will reduce the tax gap driven by high-income individuals making more than 

$400,000 per year and large corporations. Consistent with Secretary Yellen’s directive to the Internal 

Revenue Service, audit rates will not increase, relative to historic levels, for small businesses or taxpayers 

earning less than $400,000 per year. Further, to continue the IRA-funded initiatives and investments after 

FY 2031, the Budget proposes to provide continued mandatory funding for the IRS for fiscal years 

2032 and 2033 to supplement the annual appropriations for the agency’s Enforcement and Operations 

Support accounts. The Administration looks forward to working with Congress to ensure the IRS has the 

resources it needs to continue its focus on improving customer experience in the long-term.

The forthcoming strategic operating plan for the IRA was built under the assumption that IRA funds will 

support transformation efforts but not be used to support current, “steady-state” operations. To cover 

steady state operations, annual discretionary appropriations must be fully maintained at least the FY 2022 

level, include growth for inflation and pay raises. Any reduction in annual discretionary funds – including 

not providing for inflationary increases to maintain current levels – will require the use of IRA funding 

for general operations. This would be to the detriment of the service, technology, and compliance 

initiatives required for modern tax administration and outlined in the forthcoming plan. Diverting IRA 

funding to cover base discretionary enforcement needs would reduce revenue collection and increase 

deficits.
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Since FY 2010, the IRS has taken extraordinary measures in utilizing supplemental funding, user fees, 

and relying on inter-appropriation transfers to supplement Taxpayer Services discretionary funding. 

Taxpayer Services resources are not only critical to the current transformative efforts of the IRS, but they

are also critical to meeting the routine needs of every taxpayer. Limited appropriated resources and 

fluctuating demand for services has posed a substantial challenge for the IRS to provide taxpayers with

the consistent quality service they should expect from a global-leading tax agency. The table below shows 

the substantial discrepancy between enacted funding in the IRS direct account versus how much is 

annually obligated across all funding sources. This incongruity has factored immensely into the service 

the IRS has been able to provide to taxpayers, and unless the IRS realizes sustained increases in 

discretionary funding, service quality will continue to suffer. The FY 2024 request includes a large 

increase to Taxpayer Services funding to address this issue and put the IRS on a more sustainable path 

towards providing the top-quality service American taxpayers deserve. The requested increase brings 

Taxpayer Services funding in line with the actual cost to provide the service Taxpayers expect and 

deserve.

The need for increased Taxpayer Services appropriations has been reflected in the trend in the IRS’s level 

of service (LOS) metric, which tracks the relative success rate of taxpayers who are attempting to reach a 

customer service representative (CSR) on the phone. Beginning in FY 2018, LOS began to decline, and 

significant pandemic-related demand exacerbated the negative trend. While the IRS will be using IRA 

resources to supplement appropriated Taxpayer Services funds, if additional funds are not appropriated 

(beyond inflationary increases), the IRS anticipates exhausting Taxpayer Services IRA funding in just 

four years. Sustained long-term increases in appropriated Taxpayer Services funding are needed to ensure 

that taxpayers receive the assistance they need and deserve.
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The Administration recommends a 23.1 percent increase in the Taxpayer Services appropriation over the 

FY 2023 Enacted level to ensure that the IRS maintains the improvements made possible by the IRA 

resources.

Note: The "Other" category includes Business Systems Modernization, Health Insurance Tax Credit Administration, and Section 113/Sec. 112.

Full-Time Equivalent (FTE) staffing levels shown are funded through IRS annual appropriations,

administrative provisions, and other legislation. In FY 2020, this included 2,144 FTE funded through the 

CARES Act. In FY 2021, this included 2,933 FTE funded through supplemental appropriations within the 

Consolidated Appropriations Act, 2021 and the American Rescue Plan. In FY 2022, in addition to the 

FTE shown in the table, the IRS realized an additional 483 FTE funded with prior year carryover money 

(20 FTE in Taxpayer Services, 460 FTE in Operations Support, and 3 FTE in BSM), 5,854 FTE funded 

by the American Rescue Plan (4,476 FTE in Taxpayer Services, 1,357 FTE in Operations Support, and 20 

FTE in BSM), and 2 FTE funded by the No Surprises Act in Enforcement.

Fairly administering the tax laws within a voluntary compliance regime requires an enforcement presence 

to deter willful evasion. While a portion of the unpaid tax obligations that make up the tax gap result from 

a lack of knowledge or ambiguity and complexity in tax law, willful evasion is a significant contributing 

factor. Resources provided by the IRA will reduce the tax gap driven by high-income individuals making 

more than $400,000 per year and large corporations. Consistent with Secretary Yellen’s directive to the 

Internal Revenue Service, audit rates will not increase, relative to historic levels, for small businesses or 

taxpayers earning less than $400,000 per year. The FY 2024 request will cover inflationary increases as 

well as legislative proposals to accelerate IRS hiring, which will help address various facets of the tax 

gap. 

Other

Enforcement

Operations Support

Taxpayer Services

0

25,000

50,000

75,000

100,000

2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022

FTE

FY Actuals

IRS Workforce has decreased by 23% since FY 2010, with 

Enforcement staffing showing the biggest decrease
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Notification of Changes to the Appropriations 

The IRS has identified support costs that should be charged to the mission appropriations. These charges 

can be moved without a change to its appropriation language. The IRS will begin transitioning 

appropriate costs to the Taxpayer Services and Enforcement accounts in 2024. At the start of FY 2024, 

the IRS will make these adjustments to the appropriations:

• Realign Human Capital Office costs that directly support Enforcement and Taxpayer Service 

hiring from the Operations Support account. For FY 2024, this would result in a realignment of 

$83 million from Operations Support—$52 million to Taxpayer Services, and $31 million to 

Enforcement.

• Allocate all Equity, Diversity, and Inclusion staffing costs proportionately by FTEs between the 

Taxpayer Services, Enforcement, and Operations Support accounts (currently these costs are fully 

charged to Operations Support). For FY 2024, this would more accurately reflect the work 

performed and result in realignment of $17.7 million from Operations Support—$10.1 million to 

Taxpayer Services, and $7.6 million to Enforcement. 

• Realign all staffing costs for the Deputy Commissioner, Services and Enforcement front office and 

project management office from the Operations Support appropriation. This would more 

accurately reflect the work performed by these offices, which primarily support Enforcement 

programs. For FY 2024, this would result in realignment of $4.9 million.

1.2 – Inflation Reduction Act Implementation

The IRA provided the IRS $79.4 billion in funding over the next decade to dramatically change the way it 

serves taxpayers, harness the power of modern technology, invest in, and grow its employees with new 

tools, skills, and capabilities, and ensure tax compliance among high-income individuals, complex 

partnerships, and large corporations. 

With the $2.8 billion apportioned in FY 2023 and the more than $5.8 billion planned for FY 2024, the 

IRS will begin its transformation into a much more customer-focused agency that strives to help taxpayers 

get it right the first time – both in meeting their obligations and claiming the credits and incentives to 

which they are eligible. 

In Enforcement, this includes addressing priority compliance issues that contribute to the tax gap, such as 

those related to complex partnership structures, high-net worth individuals and entities, large 

Dollars in Thousands

Internal Revenue Service FY 2022

Budgetary Resources Enacted

AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Taxpayer Services 3,181,500 $1,073 7,394 $837,735 6,489 $815,966

Enforcement 45,637,400 1,543 $371,767 7,239 $1,408,470

Operations Support 25,326,400 $60,965 727 $1,017,758 3,810 $2,380,097

Business Systems Modernization 4,750,700 $43,924 357 $580,000 197 $1,034,000

Direct eFile 15,000 $15,000

Energy Security 500,000 1,810 $180,000

Total Budgetary Resources $79,411,000 0 $105,962 10,021 $2,822,260 19,545 $5,818,533

Actual Obligations Estimated Obligations Estimated Obligations

FY 2022 FY 2023 FY 2024
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corporations, and cross-border tax. Given the resources required to conduct audits of high-income

individuals, partnerships, and large corporations, hiring of enforcement staff will focus on tax 

accountants, attorneys, and other specialized staff needed to do this complex work. For example, audits of 

high-income earners may take tax accountants upwards of 250 hours to complete. By comparison, audits 

of typical taxpayers take only five hours, are conducted through the mail, and do not require specialized 

tax accountants. All-in-all, audits of wealthy taxpayers take at least 50 times as long. Corporate audits 

average hundreds of hours over two to four years. These audits often involve more than a dozen issues 

that each require separate teams of tax accountants and lawyers to resolve. The goal is to front load the 

hiring of tax accountants, attorneys, and other specialized staff so they can be brought up to speed by the 

current senior experts who may be eligible to retire soon. This work is incredibly complex, and IRS does 

not want to lose decades of institutional knowledge through continued waves of retirements without 

departing experts first training the next generation of experts. All enforcement efforts will comply with 

Treasury’s August 10, 2022, directive, to not increase audit coverage of households and small businesses 

making less than $400,000 a year relative to historic norms.

Funds will also help the IRS accelerate our ability to deliver technology capabilities. New technology 

investments will be built on foundational platforms that are built to meet our future needs. This will 

require careful coordination between new capability delivery and our need to modernize legacy platforms. 

Data and cyber security will be at the center of all aspects of our transformation. This modernization will 

strengthen the IRS’s competitiveness and will serve all Americans.

The IRS will also conduct a study on the cost of developing and running a free direct e-File tax return 

system. Additionally, the IRS will use these funds to continue implementation of the Energy Security tax 

credits included in the legislation including: costs for necessary IT modernization efforts and for hiring 

staff to support the development of implementation guidelines, associated compliance efforts, and 

anticipated customer-service needs.

The forthcoming Strategic Operating Plan for the IRA was built under the assumption that IRA funds will 

support transformation efforts while current, steady-state operations would be supported by annual 

appropriations. The IRA Strategic Operating Plan, which describes IRS’s intentions for these new 

resources, will be released soon. To cover steady state operations, annual discretionary appropriations 

must be fully maintained at the FY 2022 level, including growth for inflation and pay raises. Any 

reduction in annual discretionary funds – including not providing for inflationary increases to maintain 

current levels – will require IRA funding to be shifted to general operations. This would be to the 

detriment of the service, technology, and compliance initiatives envisioned to transform the IRS. 

Diverting IRA funding to cover base discretionary enforcement needs would lead to higher tax evasion by 

the wealthy and large corporations, leading to decreased revenue collection and increased deficits.
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B – Summary of the Request

The IRS is responsible for administering the Nation’s tax system and meeting the needs of U.S. taxpayers 

by helping them understand their tax responsibilities and enforcing the law with integrity and fairness. 

The IRS’s core operations include collection of individual and corporate taxes, examination of returns, 

taxpayer assistance, oversight of tax-exempt organizations, administering multiple refundable tax credits,

and other specialized programs. 

In FY 2022, the IRS collected more than $4.9 trillion in taxes (gross receipts before tax refunds), nearly 

all the revenue that supports the Federal government’s operations. With the U.S. tax base becoming more 

complex, one key responsibility of the IRS is to make it easier for taxpayers to understand and meet their 

tax obligations.

FY 2024 Budget Request and Priorities

The IRS FY 2024 budget request is composed of strategic investments that are aligned with the 

President’s Management Agenda and mission driven efforts that will propel the trajectory of the agency to 

better serve the taxpayer, warrant an impartial tax system, and reduce the tax gap. The FY 2024 request is

$14.1 billion, $1.8 billion or 14.7 percent more than the FY 2023 Enacted Budget of $12.3 billion. The 

budget request includes $13.1 billion in base resources and $999.4 million in program increases that will:

• Improve Telephone Level of Service and Reduce Correspondence Inventory ($267.2 million), 

• Implement Green Tax Credit Legislation ($105.6 million), 

• Improve the Taxpayer Experience ($41.4 million), 

• Restore Staffing Levels ($167.6 million), 

• Invest in Fleet Electrification and Sustainable/Resilient Buildings ($44.6 million), 

• Sustain Deployed IT Capabilities and Infrastructure ($83.4 million), and 

• Restore Business Systems Modernization ($289.6 million).
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1.3 – Budget Adjustments Table

See footnotes in 1.1 - Appropriations Detail Table.

Bureau: Internal Revenue Service

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $12,319,054 72,627 

Changes to Base:

Maintaining Current Levels (MCLs): $536,665

Pay Annualization (4.6% average pay raise) 106,749

Pay Raise (5.2% average pay raise) 370,725

Non-Pay 59,190

Technical Base Adjustments $281,470

FERS Law Enforcement Rate Increase 50,234

Improve Competitiveness of IRS Clerical Staff 44,220

Change in Staffing Designation 187,016

Subtotal Changes to Base $818,135

FY 2024 Current Services $13,137,189 72,627 

Program Increases:

Strategies for Improving the Taxpayer Experience 41,381 54 

Green Tax Credit Implementation 105,631 1,221 

Improve Telephone Level of Service and Reduce 

Correspondence Inventory 267,190 3,448 

Restoration of Staffing Levels 167,637 556 

Fleet Electrification 15,098 3 

Sustainment of Deployed IT Capabilities 55,878 43 

Sustaining Infrastructure 27,500 26 

Business Systems Modernization 289,619 197 

Sustainable and Resilient Buildings 29,462 3 

Subtotal FY 2024 Program Increases $999,396 5,551

FY 2024 President's Budget Request $14,136,585 78,178 

Dollars in Thousands
IRS-12 

C – Base Adjustment and Program Changes Description

Maintaining Current Levels.............................................. +$536,665,000 / 0 FTE

Pay Annualization (4.6%) +$106,749,000 / 0 FTE 

Funds are requested for annualization of the January 2023 4.6 percent average pay raise. 

Pay Raise (5.2%) +$370,725,000 / 0 FTE 

Funds are requested for a 5.2 percent average pay raise in January 2024. 

Non-Pay +$59,190,000 / 0 FTE 

Funds are requested for 2.0 percent increase in non-labor expenses such as travel, contracts, rent, supplies, 

and equipment due to inflation.

Base Adjustment...................................................+$281,470,000 / 0 FTE

The FY 2024 base begins at the FY 2023 Enacted level of $12.3 billion. In addition to $537 million to 

maintain current staffing levels, the base was adjusted by $281 million dollars to reach current operating 

funding levels. The additional base adjustment entails supplementary labor costs within Taxpayer 

Services and Enforcement. 

FERS Law Enforcement Rate Increase +$50,234,000 / 0 FTE 

With the anticipated 0.6 percent Federal Employees Retirement System (FERS) contribution rate increase

in FY 2024 for law enforcement officials (Criminal Investigation special agents), the IRS projects an 

additional labor mandate of $50 million. 

Improve Competitiveness of IRS Clerical Staff +$44,220,000 / 0 FTE

The IRS uses clerical staff across a range of programs, resulting in multiple position descriptions that 

create complexity for personnel management and inflexibility in applying resources to shifting needs. 

Further, wages for these staff members have lagged other employers undermining recruitment efforts. IRS 

established new consolidated and standardized position descriptions to address these challenges. The new 

clerical positions are classified at a higher grade than most current submission processing clerks. This 

higher-grade structure will enhance the IRS’s desirability as an employer, but it will also increase labor 

costs. The IRS has experienced an average attrition rate of 47 percent for Submission Processing Clerks 

over the past five years, and low wages have undermined the effectiveness of recruiting efforts for these 

critical roles. To address these challenges, the IRS conducted a comprehensive review of all clerical 

positions to establish new consolidated and standardized position descriptions. The new clerical position 

will achieve the goals of leveraging staff in any clerical function as workload dictates. In addition to 

providing a competitive wage that is above the poverty level and competitive with other employers, 

implementation will have a positive impact on Submission Processing operations, enabling managers to 
IRS-13 

balance workload, and will streamline external job announcements required to fill clerical vacancies at 

IRS campuses.

Change in Staffing Designation +$187,016,000 / 0 FTE

The IRS is requesting $187 million to convert some taxpayer services hiring efforts from seasonal to 

permanent staffing. Thousands of additional seasonal staff have been required in recent years to address 

increased demand for taxpayer services. An overreliance on seasonal hiring has prevented the IRS from 

adequately addressing taxpayers’ year-round needs for service, leading to a significant backlog in the 

correspondence inventory. Also, attrition is much higher for this type of staff in comparison with 

permanent hires, often leading to a need for additional recruiting and training of new staff, which takes 

15 weeks to complete for new customer service representatives. Converting seasonal staff positions to 

permanent positions will play a major role year-round in enhancing the service and reducing inventory 

levels when telephone demand is low. These resources will allow the IRS to fulfill taxpayer needs more 

efficiently, as less attrition will lead to more experienced staff and less frequent recruiting and training. 

Program Increases...................................................... +$999,396,000 / +5,551 FTE

Strategies for Improving the Taxpayer Experience +$41,381,000 / +54 FTE

The Taxpayer First Act, Public Law 116-25, requires the IRS to develop and implement strategies to 

improve American taxpayers’ experiences with the IRS. Putting taxpayers first requires that the IRS 

maintains the range of services already available while using IRA to modernize the suite of available 

options. To fulfill this requirement, the IRS will continue to enable taxpayers and practitioners to better 

understand and meet their tax obligations. Requested funding will be used to expand the ways taxpayers 

can interact with the IRS; digital alternatives will increase efficiency and improve communication 

between the IRS and taxpayers. Funding will be used to maintain the number of digital assistance options 

taxpayers may use to access resources for complying with tax laws. Additional authenticated online 

self-services will include account updates, secure messaging and notice delivery, full interaction history 

and issue status, refund tracking, increased electronic receipt of filings, and data capture for paper filings. 

Funding will also further IRS efforts to enable taxpayers to receive and upload documents in a secure 

environment, expand payment options, utilize web chat, and other digital assisted services. 

Position Type/Other Costs FTE Positions $000

Strategies for Improving the Taxpayer Experience 54 108 $41,381

Attorney 2 4 592

IT Specialist 11 22 2,333

Analyst 41 82 10,655

Contractual Services 27,801

Total 54 108 $41,381
IRS-14 

Green Tax Credit Implementation +$105,631,000 / +1,221 FTE

With the passage of the IRA, which included $500 million (over 10 years) for climate and clean energy

tax credit implementation, the IRS is committed to ensuring the success of all tax administration efforts 

associated with the law. To fully support the various IRA tax credit provisions, the IRS requires funds 

above-and-beyond the $500 million provided in IRA to develop or modify forms, instructions, and 

notifications, conduct taxpayer education and outreach, address increased telephone, correspondence, and 

face-to-face demands, create processes to allow and track direct payments, and ensure compliance. 

The IRS envisions significant education and training costs will be required to support implementation of 

the climate and clean energy tax credits in the IRA. This includes internal and external 

education, frequently asked questions, and communications. Procedures, notices, and training will require 

an extensive initial commitment of personnel in multiple business units.

Funding is also necessary to help Chief Counsel to interpret provisional requirements included in the law. 

The IRS also foresees increased technology demand concurrent with the deployment of these credits. 

Appropriately servicing taxpayers will require new technological platforms along with the standard 

service channels as the IRS anticipate a full ramp-up of servicing these legal requirements by FY 2024. 

Funding for this investment will also be supplemented with $180 million of IRA Energy Security funding 

in FY 2024. 

Improve Telephone Level of Service and Reduce Correspondence Inventory 

+$267,190,000 / +3,448 FTE

This investment will enable the IRS to achieve and maintain high LOS performance outcomes and 

supersede FY 2023 levels. The IRS toll-free telephone customer service operation is one of the world’s 

largest and is a key part of the IRS’s service delivery. Taxpayer experience research continues to indicate 

phone service as a preferred service channel. With discretionary funding to maintain basic customer 

service operations and the IRA funding, the projected FY 2024 LOS is 80 percent for the fiscal year and 

85 percent during the filing season. 

Position Type/Other Costs FTE Positions $000

Improve Telephone Level of Service and Reduce 

Correspondence Inventory 3,448 3,448 $267,190

Customer Service Representative 1,845 1,845 115,296 

Seasonal 1,603 1,603 149,894 

Contractual Services 2,000 

Total 3,448 3,448 $267,190
IRS-15

In addition to live assistors, the IRS also provides phone service to taxpayers using automation. During 

FY 2022, nearly 34 million taxpayers received the answer to their questions through automation. To help 

capture the volume of this assisted population, the IRS is developing a measure for inclusion in 

performance reporting that expands on Customer Service Representative (CSR) LOS to include these 

automated calls. The new measure, LOS(A), for FY 2022 was 39.3 percent and IRS intends to baseline 

this measure in FY 2023. 

Funding this investment below the requested level will reduce the LOS and negatively impact the 

taxpayer experience. When taxpayers cannot reach the IRS or get questions answered, taxpayers saturate 

other service channels like paper correspondence. Based on the prior experience with the paper volumes 

experienced during the pandemic, moving taxpayers to a more burdensome, costly, and time-consuming 

service channel will negatively impact taxpayers’ abilities to comply and the IRS’ ability to function 

effectively. Although the IRS did receive $3.2 billion in IRA for taxpayer services, IRS will spend 

$800 million just in FY 2023to hire additional CSRs to enhance the LOS and reduce the paper backlog, 

and at that pace, we anticipate that the IRS will exhaust all IRA taxpayer services funding in just four 

years.

Together with IRA funding, this investment will allow the IRS to increase the telephone level of service 

(LOS) above FY 2023 levels. To date, with the supplement of IRA funding, the IRS has realized a 

261 percent (23.8 percent to 85.9 percent) improvement of its filing season telephone level of service

metric compared to filing season 2022. The IRS toll-free telephone customer service operation is one of

the world’s largest and is a key part of the IRS’s service delivery. Taxpayer experience research continues 

to indicate phone service as a preferred service channel. With this investment and the IRA funding, the 

projected FY 2024 LOS is 80 percent and 85 percent LOS during the individual filing season. 

In addition to live assistors, the IRS also provides phone service to taxpayers using automation. During 

FY 2022, nearly 34 million taxpayers received the answer to their questions through automation. The IRS 

is developing a measure for inclusion in performance reporting that expands on CSR LOS to include these 

automated calls. The new measure, LOS(A), for FY 2022 is 39.3 percent and IRS intends to baseline this 

measure in FY 2023.

Investment funding below the requested level will reduce LOS and negatively impact the taxpayer 

experience. Based on historical experience, when taxpayers cannot reach the IRS in their preferred service 

channel (phone), it results in increases in other service channels, including paper correspondence. Based 

on the experience with paper, and specifically the paper volumes experienced because of the pandemic, 

moving taxpayers to a more burdensome, costly, and time-consuming service channel will negatively 

impact taxpayers' ability to comply. Although the IRS did receive $3.2 billion in IRA for taxpayer 

services, the IRS will spend $800 million just in FY 2023 to hire additional CSRs to enhance the LOS and 

reduce the paper backlog, and at that pace, IRS will exhaust all IRA taxpayer services funding in just four 

years.

The below table shows historical and projected data to illustrate how variables such as FTE spent in 

Accounts Management (AM), demand, calls answered, and average handle time (AHT) impact the LOS 

each year. The table shows AM phone demand in FY 2022 of 81.3 million was 32 percent lower than the 

2021 figure of 119.9 million, but still substantially higher than the average pre-pandemic phone demand 

of 40 million.
IRS-16 

1 FY 2023 assumed funding level of 24,949 FTE. 

2 FY 2024 assumes base appropriations plus receipt of investment proposal, plus receipt of IRA funding, assumed funding level of 27,800 FTE. 

Correspondence receipts are based on 100% of FY 2022 actuals.

Restoration of Staffing Levels +$167,637,000 / +556 FTE 

This investment will begin to restore critical staffing the IRS has been unable to replace due to a variety 

of factors, including unfunded inflation increases, growing needs for expanded information technology 

systems, and various legislative mandates. The IRS has experienced significant staff attrition over the past 

ten years, with a loss of over 10,000 positions since 2012,1

 predominately within the compliance function. 

In addition, an estimated 63 percent of IRS employees will be eligible for retirement in the next five 

years, and the IRS’s current attrition rate is nearly 26 percent higher than the average for federal 

agencies.

2

 

While the IRA provided the IRS with significant resources for a transformative expansion of its tax 

enforcement and taxpayer services efforts, there remains a need for a reversal of the multi-year 

inflation--adjusted decline in the IRS’s foundational staffing resources. 

Fleet Electrification +$15,098,000 / +3 FTE 

The IRS Criminal Investigation (IRS-CI) operates a fleet of 2,225 GSA-leased gas vehicles at an annual

cost of approximately $13 million. Each of these vehicles typically has a five to six-year lifespan, 

1 https://www.irs.gov/statistics/irs-budget-and-workforce

2 https://www.irs.gov/about-irs/people. IRS statistic excludes seasonal employees.

Position Type/Other Costs FTE Positions $000

Fleet Electrification 3 7 $15,098

Program Analyst 3 7 454 

Contractual Services 11,724 

Equipment 2,920 

Total 3 7 $15,098
IRS-17 

resulting in an average of 400 vehicles being replaced annually. As mandated by President Biden’s 

Executive Order, “Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability,” all 

newly acquired light duty vehicles are required to be Zero Emission Vehicles (ZEVs) by 2027. The 

adoption of Electrical Vehicles (EVs) will require an initial investment for infrastructure installation. 

However, after the EV infrastructure is installed, the cost to operate the fleet annually will be reduced. 

The cost savings of operating an EV compared to a gas vehicle is $94 per month, which equates to 

$1,128 per year. Assuming a fleet of over 2,225 vehicles, this results in a cost savings of more than 

$2.5 million annually after all vehicles are replaced. IRS-CI currently spends $360,000 annually on 

vehicle maintenance, which would also decrease as the fleet transitions to an all-EV fleet as gas vehicle 

leases expire.

For example, using an average assumption of traveling 12,700 miles per year (1,058 miles per month) the 

cost to operate an EV is $56 per month. To travel the same distance using traditional gas, assuming 24 

miles per gallon,

3

 the cost to operate the same vehicle is $150 per month. Thus, the cost savings of 

operating an EV is roughly $94 per month, which equates to $1,128 per year. Assuming a fleet of over 

2,225 vehicles, this results in a cost savings of over $2.5 million annually. Furthermore, EVs are 

emission-free and maintenance costs are substantially less (e.g., no oil changes, brakes last longer), and 

any other mechanical systems would last the five to seven years IRS-CI keeps the vehicle. IRS-CI 

currently spends $360,000 annually on vehicle maintenance, which would also decrease as the fleet 

transitions to an all-EV fleet as gas vehicle leases expire. 

Sustainment of Deployed IT Capabilities +$55,878,000 / +43 FTE

The IRS intends to use funds provided under the American Rescue Plan Act and IRA to accelerate the 

modernization of its core, foundational technology. However, it must continue to operate the core tax 

processing system while planning, designing, and executing modernization activities. IRS relies upon its 

recurring IT Operations Support resources, or base, to operate these systems. The base has been and 

remains underfunded and relies on more than $500 million per year in supplemental resources, such as 

Inter-Appropriations Transfers, reimbursables, and user fees to sustain technology operations. This 

funding will enable a partial, yet minimal restoration of the base and fund the operations and maintenance 

of deployed systems. IRS will otherwise need to use IRA funds to cover ongoing operations, which would 

come to the detriment of implementing truly cross-cutting, modernization initiatives that position IRS for 

the future.

3 Cost savings estimates are based on fuel assumptions that base kWh at an average of 16 cents and gas at $3.40 per gallon. The IRS realizes kWh and gas 

prices vary widely across the country and change daily. Furthermore, this analysis does not consider the increased cost to acquire electrical vehicles, which will 

reduce cost savings related to fuel and maintenance savings.

Position Type/Other Costs FTE Positions $000

Sustainment of Deployed IT Capabilities 43 86 $55,878

IT Specialist 43 86 9,120

Contractual Services 46,758

Total 43 86 $55,878
IRS-18 

Sustaining Infrastructure +$27,500,000 / +26 FTE

The IRS owns and operates the datacenters, hardware, and software that underly most of its information 

systems. While the IRS has long-term ambitions to transition most of this infrastructure to the cloud—

whereby the service provider bears responsibility for the infrastructure— the IRS must continue to 

upgrade and improve hardware and software that is approaching or has reached end of life. While the IRS 

continues to make progress in reducing the backlog of outdated/aged infrastructure, the IRS requires 

continued discretionary funding to stay on course. 

Business Systems Modernization +$289,619,000 / +197 FTE

Although IRS received $4.75 billion in Business Systems Modernization (BSM) funding in IRA, the 

modernization essential to support 21st century tax administration requires sustained annual discretionary 

funding in addition to mandatory funding. Successful implementation of the forthcoming IRA Strategic 

Operating Plan will heavily depend on restored BSM discretionary funding. These funding sources will 

enable the IRS to realize the envisioned modernization objectives. Without discretionary funding, 

approximately one-third of the planned modernization will need to be descoped, delayed, or entirely 

withdrawn. A portion of this investment will provide system engineering management capabilities, 

including systems strategy, architecture, and engineering capabilities.

Modernization remains a key IRS priority and the BSM appropriation, along with IRA funding, provide a 

long-term approach to technological advances, which will transform the customer experience by making 

services simpler, quicker, and more responsive. The IRS will improve interactions and communications 

with taxpayers and third parties by providing a broad range of self-service options and establishing a 

secure information exchange that will enable authorized third parties and taxpayers to interact digitally 

with the IRS and optimize the user experience and deliver consistent and secure information no matter 

which channel is used to contact the IRS. 

Additionally, the IRS is continuing its effort to implement a single, modernized, enterprise case 

management system with access to taxpayer data and standard business processes across the IRS, 

Position Type/Other Costs FTE Positions $000

Sustaining Infrastructure 26 52 $27,500

IT Specialist 26 52 5,514 

Contractual Services 19,787 

Hardware and Software 2,199 

Total 26 52 $27,500

Position Type/Other Costs FTE Positions $000

Business Systems Modernizations 197 394 $289,619

IT Specialist 197 394 41,011

Contractual Services 244,919

Hardware and Software 3,689

Total 197 394 $289,619
IRS-19 

resulting in the consolidation of capabilities from over 60 disparate systems (see below). This funding will 

accelerate the transition of capabilities from legacy case management systems to a modern ECM platform. 

This will result in retirement and consolidation of the depicted legacy platforms, operational efficiencies, 

and transparent case processing for taxpayers. A portion of the funding will provide system engineering 

management capabilities, including systems strategy, architecture, and engineering capabilities. Although 

IRS received $4.75 billion in BSM funding in IRA, the modernization envisioned in the forthcoming IRA 

Strategic Operating Plan will require that discretionary BSM funding of approximately $290 million be 

restored. 

Sustainable and Resilient Buildings +$29,462,000 / +3 FTE 

The IRS seeks to be a leader in opportunities to implement initiatives that directly support the Bureau 

Climate Action Plan and ensure sustainability. In accordance with the requirements of the 

Administration’s Climate Agenda, and Executive Order 14008, Tackling the Climate Crisis at Home and 

Abroad, the U.S. Department of the Treasury and the IRS have completed Climate Action Plans that 

define specific actions to build climate resilient programs, invest finances and direct procurement in 

sustainable infrastructure, develop climate resilient real property, and create a Fleet Conversion Plan for 

Treasury that includes installation of non-CI electric vehicle supply equipment at IRS facilities across the 

country. 

The IRS, in partnership with the Department of Energy, will contract for the completion of Energy 

Savings Performance Contracts (ESPC) at the Austin, Martinsburg, Memphis, and Ogden campuses. 

ESPCs will help enhance the IRS’s ability to anticipate, prepare for, and adapt to changing conditions and 

to withstand, respond to, and recover rapidly from disruptions at major work sites. The IRS is also

developing a Fleet Conversion Plan for Treasury that includes installation of non-Criminal Investigation 

electric vehicle supply equipment (EVSE) at IRS facilities across the country to achieve 100 percent 

zero-emission light duty federal fleet vehicle acquisitions by 2027.

Position Type/Other Costs FTE Positions $000

Sustainable and Resilient Buildings 3 6 $29,462

Program Analyst 3 6 620

Contractual Services 28,842

Total 3 6 $29,462
IRS-20 

1.4 – Object Classification (Schedule O) Obligations

Amounts reflect obligations of annually appropriated discretionary resources.

See footnotes in 1.1 - Appropriations Detail Table.

Dollars in Thousands

Internal Revenue Service FY 2022 FY 2023 FY 2024

O bject Classification

O perating 

Plan

Estimated

O bligations

Request

11.1 - Full-time permanent 6,034,701 6,265,491 7,055,862

11.3 - Other than full-time permanent 64,278 71,924 76,231

11.5 - Other personnel compensation 376,851 358,998 388,651

11.8 - Special personal services payments 36,163 69,079 72,598

11.9 - Personnel Compensation (Total) 6,511,993 6,765,492 7,593,342

12.0 - Personnel benefits 2,435,210 2,504,443 2,832,190

13.0 - Benefits for former personnel 7,273 12,583 13,224

Total Personnel and Compensation Benefits $8,954,476 $9,282,518 $10,438,756

21.0 - Travel and transportation of persons 38,632 121,327 132,216

22.0 - Transportation of things 22,302 25,007 36,350

23.1 - Rental payments to GSA 584,918 607,157 625,993

23.2 - Rental payments to others 786 512 525

23.3 - Communications, utilities, and miscellaneous charges 294,900 289,684 312,573

24.0 - Printing and reproduction 70,900 39,652 41,649

25.1 - Advisory and assistance services 1,594,635 869,504 1,268,268

25.2 - Other services from non-Federal sources 62,128 101,551 120,763

25.3 - Other goods and services from Federal sources 193,641 221,629 230,969

25.4 - Operation and maintenance of facilities 195,722 192,706 208,404

25.6 - Medical care 28,176 19,619 21,016

25.7 - Operation and maintenance of equipment 56,874 65,568 71,263

26.0 - Supplies and materials 31,748 47,424 53,052

31.0 - Equipment 318,991 282,480 351,980

32.0 - Land and structures 60,184 65,382 135,268

41.0 - Grants, subsidies, and contributions 54,000 77,000 77,000

42.0 - Insurance claims and indemnities 23,541 2,334 2,380

91.0 - Unvouchered 7,500 8,000 8,160

Total Non-Personnel $3,639,578 $3,036,536 $3,697,829

Total O bligations $12,594,054 $12,319,054 $14,136,585

Full-time Equivalents (FTE) 72,648 72,627 78,178
IRS-21

D – Appropriations Language and Explanation of Changes

Appropriations Language Explanation of Changes

TAXPAYER SERVICES

For necessary expenses of the Internal 

Revenue Service to provide taxpayer services, 

including pre-filing assistance and education, 

filing and account services, taxpayer 

advocacy services, and other services as 

authorized by 5 U.S.C. 3109, at such rates as

may be determined by the Commissioner, 

[$2,780,606,000]$3,422,449,000, of which 

not to exceed $100,000,000 shall remain 

available until September 30,[2024] 2025, of 

which not less than $11,000,000 shall be for 

the Tax Counseling for the Elderly Program, 

of which not less than $26,000,000 shall be 

available for low-income taxpayer clinic 

grants, including grants to individual clinics 

of up to $200,000, of which not less than 

$40,000,000, to remain available until 

September 30,[2024] 2025, shall be available 

for the Community Volunteer Income Tax 

Assistance Matching Grants Program for tax 

return preparation assistance, and of which 

not less than $236,000,000 shall be available 

for operating expenses of the Taxpayer 

Advocate Service: Provided, That of the 

amounts made available for the Taxpayer 

Advocate Service, not less than $7,000,000 

shall be for identity theft and refund fraud 

casework. 

ENFORCEMENT

For necessary expenses for tax enforcement 

activities of the Internal Revenue Service to 

determine and collect owed taxes, to provide 

legal and litigation support, to conduct 

criminal investigations, to enforce criminal 

statutes related to violations of internal 

revenue laws and other financial crimes, to 

purchase and hire passenger motor vehicles 

(31 U.S.C. 1343(b)), and to provide other 

services as authorized by 5 U.S.C. 3109, at 

such rates as may be determined by the 

Commissioner,[$5,437,622,000]
IRS-22

$5,904,441,000; of which not to exceed

$250,000,000 shall remain available until 

September 30, [2024] 2025; of which not less 

than $60,257,000 shall be for the Interagency

Crime and Drug Enforcement program; and 

of which not to exceed $25,000,000 shall be 

for investigative technology for the Criminal

Investigation Division: Provided, That the 

amount made available for investigative

technology for the Criminal Investigation 

Division shall be in addition to amounts

made available for the Criminal Investigation 

Division under the "Operations Support" 

heading.

OPERATIONS SUPPORT

For necessary expenses to operate the Internal 

Revenue Service to support taxpayer services 

and enforcement programs, including rent 

payments; facilities services; printing; 

postage; physical security; headquarters and 

other IRS-wide administration activities; 

research and statistics of income; 

telecommunications; information technology 

development, enhancement, operations, 

maintenance and security; the hire of 

passenger motor vehicles (31 U.S.C. 

1343(b)); the operations of the Internal 

Revenue Service Oversight Board; and other 

services as authorized by 5 U.S.C. 3109, at 

such rates as may be determined by the 

Commissioner;[$4,100,826,000]

$4,520,076,000, of which not to exceed 

$275,000,000 shall remain available until 

September 30, [2024] 2025; of which not to 

exceed $10,000,000 shall remain available 

until expended for acquisition of equipment 

and construction, repair and renovation of 

facilities; of which not to exceed $1,000,000 

shall remain available until September 30, 

[2025] 2026, for research; and of which not to 

exceed $20,000 shall be for official reception 

and representation expenses: Provided, That

not later than 30 days after the end of each 

quarter, the Internal Revenue Service shall

submit a report to the Committees on 

Appropriations of the House of

Representatives and the Senate and the 
IRS-23

Comptroller General of the United States 

detailing major information technology 

investments in the Internal Revenue Service

[Integrated Modernization Business Plan]

portfolio, including detailed, plain language 

summaries on the status of plans, costs, and 

results; prior results and actual expenditures 

of the prior quarter; upcoming deliverables 

and costs for the fiscal year; risks and 

mitigation strategies associated with ongoing 

work; reasons for any cost or schedule 

variances; and total expenditures by fiscal 

year: Provided further, That the Internal 

Revenue Service shall include, in its budget 

justification for fiscal year [2024] 2025, a 

summary of cost and schedule performance 

information for its major information 

technology systems.

BUSINESS SYSTEMS MODERNIZATION

For necessary expenses of the Internal 

Revenue Service's business systems 

modernization program, $289,619,000, to 

remain available until September 30, 2026 for 

the capital asset acquisition of information 

technology systems, including management 

and related contractual costs of said 

acquisitions, including related Internal 

Revenue Service labor costs, and contractual 

costs associated with operations authorized 

by 5 U.S.C. 3109: Provided, That not later 

than 30 days after the end of each quarter, the 

Internal Revenue Service shall submit a 

report to the Committees on Appropriations 

of the House of Representatives and the 

Senate and the Comptroller General of the 

United States detailing major information 

technology investments in the Internal 

Revenue Service portfolio including detailed, 

plain language summaries on the status of 

plans, costs, and results; prior results and 

actual expenditures of the prior quarter; 

upcoming deliverables and costs for the fiscal 

year; risks and mitigation strategies 

associated with ongoing work; reasons for 

any cost or schedule variances; and total 

expenditures by fiscal year.

With the FY 2023 Enacted Budget not 

providing any BSM resources, the IRS

remains committed to delivering the required 

technological portfolio that will foster 

modernization mandates.

The administration proposes the inclusion of 

the Business Systems Modernization 

appropriations language in the FY 2024 

President’s Budget in order to request funding 

for transformative information technology 

efforts.
IRS-24

ADMINISTRATIVE PROVISIONSINTERNAL REVENUE SERVICE 

(INCLUDING TRANSFER OF FUNDS)

SEC. 101. Not to exceed 5 percent of the 

appropriation made available in this Act to the 

Internal Revenue Service under the 

"Enforcement" heading, and not to exceed 5 

percent of any other appropriation made 

available in this Act to the Internal Revenue 

Service, may be transferred to any other 

Internal Revenue Service appropriation upon 

the advance approval of the Committees on 

Appropriations of the House of 

Representatives and the Senate.

SEC. 102. The Internal Revenue Service shall 

maintain an employee training program,

which shall include the following topics: 

taxpayers' rights, dealing courteously with 

taxpayers, cross-cultural relations, ethics, and 

the impartial application of tax law. 

SEC. 103. The Internal Revenue Service shall 

institute and enforce policies and procedures 

that will safeguard the confidentiality of 

taxpayer information and protect taxpayers 

against identity theft. 

SEC. 104. Funds made available by this or 

any other Act to the Internal Revenue Service 

shall be available for improved facilities and 

increased staffing to provide sufficient and 

effective 1–800 help line service for 

taxpayers. The Commissioner shall continue 

to make improvements to the Internal 

Revenue Service 1–800 help line service a 

priority and allocate resources necessary to 

enhance the response time to taxpayer 

communications, particularly with regard to 

victims of tax-related crimes. 

SEC. 105. The Internal Revenue Service shall 

issue a notice of confirmation of any address 

change relating to an employer making 

employment tax payments, and such notice 

shall be sent to both the employer's former 

and new address and an officer or employee 
IRS-25

of the Internal Revenue Service shall give 

special consideration to an offer-incompromise from a taxpayer who has been 

the victim of fraud by a third-party payroll tax 

preparer.

SEC. 106. None of the funds made available 

under this Act may be used by the Internal 

Revenue Service to target citizens of the 

United States for exercising any right 

guaranteed under the First Amendment to the 

Constitution of the United States.

SEC. 107. None of the funds made available 

in this Act may be used by the Internal 

Revenue Service to target groups for 

regulatory scrutiny based on their ideological 

beliefs. 

SEC. 108. None of funds made available by 

this Act to the Internal Revenue Service shall 

be obligated or expended on conferences that 

do not adhere to the procedures, verification 

processes, documentation requirements, and 

policies issued by the Chief Financial Officer, 

Human Capital Office, and Agency-Wide 

Shared Services as a result of the 

recommendations in the report published on 

May 31, 2013, by the Treasury Inspector 

General for Tax Administration entitled 

"Review of the August 2010 Small 

Business/Self-Employed Division's 

Conference in Anaheim, California" 

(Reference Number 2013–10–037). 

SEC. 109. None of the funds made available 

in this Act to the Internal Revenue

Service may be obligated or expended—

(1) to make a payment to any employee under 

a bonus, award, or recognition

program; or

(2) under any hiring or personnel selection 

process with respect to re-hiring a former 

employee;

unless such program or process takes into 

account the conduct and Federal tax

compliance of such employee or former 

employee.
IRS-26

SEC. 110. None of the funds made available 

by this Act may be used in contravention of 

section 6103 of the Internal Revenue Code of 

1986 (relating to confidentiality and 

disclosure of returns and return information).

SEC. 111. The Secretary of the Treasury (or 

the Secretary's delegate) may use the funds 

made available in this Act, subject to such 

policies as the Secretary (or the Secretary's 

delegate) may establish, to utilize direct hire 

authority to recruit and appoint qualified 

applicants, without regard to any notice or 

preference requirements, directly to positions 

in the competitive service to process 

backlogged tax returns and return 

information.

SEC. 112. Notwithstanding section 1344 of 

title 31, United States Code, funds 

appropriated to the Internal Revenue Service 

in this Act may be used to provide passenger 

carrier transportation and protection between 

the Commissioner of Internal Revenue's 

residence and place of employment.

SEC. 113. The Secretary of the Treasury (or 

the Secretary's delegate) may use funds made 

available to the Internal Revenue Service in 

this or any other provision of law to appoint, 

without regard to sections 3304 and 3309 

through 3319 of title 5, United States Code, 

qualified candidates to positions in the 

competitive service in occupations for which 

the Secretary of the Treasury (or the 

Secretary's delegate) has determined in 

writing that there is a critical hiring need or 

severe shortage of highly qualified 

candidates: Provided, That the Secretary (or 

the Secretary's delegate) shall consult with 

the Office of Personnel Management on the 

positions to recruit (including quantity), as 

well as candidate recruitment, assessment, 

and selection policies; issue guidance to 

human resources practitioners in the Internal 

Revenue Service on use of this authority; use 

Office of Personnel Management 

qualification standards in all recruitments 

made; and exercise the authority under 

Direct hire authority (DHA) provides the 

ability to expedite the hiring process in order 

to hire more efficiently during a severe 

shortage of highly qualified candidates or 

during a critical hiring need. As the IRS 

works to rapidly implement plans to utilize 

Inflation Reduction Act resources, DHA will 

help to ensure that staffing requirements are 

not an obstacle. Current expanded Direct Hire 

Authority granted by OPM to IRS for specific 

positions expires November 30, 2024.
IRS-27

chapter 71 of title 5, United States Code and 

applicable collective bargaining agreements: 

Provided further, That, the appointment 

authority provided by this section shall expire 

on September 30, 2027:Provided further, 

That, not later than 180 days after expiration 

of this authority, the Secretary shall, in 

consultation with the Director of the Office of 

Personnel Management, provide a report to 

Congress that includes demographic data of 

individuals hired pursuant to this authority; 

salary information of individuals hired 

pursuant to this authority; and how IRS 

exercised this authority consistent with merit 

systems principles.

SEC. 114. The Secretary of the Treasury (or the 

Secretary's delegate) may use funds made 

available to the Internal Revenue Service in this 

Act or any other provision of law, subject to 

such policies as the Secretary (or the 

Secretary's delegate) may establish, to take 

such personnel actions as the Secretary (or the 

Secretary's delegate) determines necessary to

administer the Internal Revenue Code of 1986, 

including (1) in addition to the authority under 

section 7812(1) of the Internal Revenue Code of 

1986, appointing not more than 200 individuals 

to positions in the Internal Revenue Service 

under streamlined critical pay authority subject 

to the requirements and conditions under 

section 9503 of title 5, United States Code, 

except that subsection 9503(a)(3) of such title 

shall not apply; and (2) appointing not more 

than 300 individuals to positions in the Internal 

Revenue Service at any one time for which (A) 

the rate of basic pay may be established by the 

Secretary of the Treasury (or the Secretary's 

delegate) at a rate that does not exceed the 

salary set in accordance with section 104 of 

title 3, United States Code; and (B) the total 

annual compensation paid to an employee in 

such a position, including allowances, 

differentials, bonuses, awards, and similar cash 

payments, may not exceed the maximum amount 

of total annual compensation payable at the 

salary set in accordance with section 104 of 

title 3, United States Code: Provided, That the 

authority provided under this paragraph shall 

expire on September 30, 2031.

Streamlined Critical Pay authority gives the 

IRS a management tool to quickly recruit and 

retain employees with high levels of expertise 

in technical or professional fields that are 

crucial to the success of the IRS’s 

transformative efforts by allowing for higher 

base salaries for these hires than would 

otherwise be possible.
IRS-28 

Section II – Budget and Performance Plan

A – Strategic Alignment

The IRS is developing an IRA Strategic Operating Plan (SOP) that will be released soon. The IRA SOP 

will provide a framework for how the IRS will use the resources to transform tax administration and 

improve services for taxpayers. 

Alignment to Treasury Strategic Plan and President’s Management Agenda (PMA)

The IRS Strategic Plan aligns to the Treasury Strategic Plan FY 2022-2026 and the PMA. 

The following shows the IRS’s alignment to the Treasury Strategic Plan:

The IRS co-leads one objective with the Office of Tax Policy.

1. Goal 1: Promote Equitable Economic Growth and Recovery 

• Objective 1.1 Tax Administration and Policy 

The IRS supports four goals and eight objectives with other Treasury Department Offices and Bureaus: 

1. Goal 2: Enhance National Security 

• Objective 2.1 Cyber Resiliency of Financial Systems and Institutions 

• Objective 2.4 Transparency in the Financial System 

2. Goal 3: Protect Financial Stability and Resiliency 

• Objective 3.3 Financial Innovation 

3. Goal 4: Combat Climate Change 

• Objective 4.4 Sustainable Treasury Operations 

4. Goal 5: Modernize Treasury Operations 

• Objective 5.1 Recruit and Retain Diverse and Inclusive Workforce

• Objective 5.2 Future Work Routines 

• Objective 5.3 Better Use of Data 

• Objective 5.4 Customer Experience Practices 

The IRS aligns to the three PMA priorities: 

• PMA Priority 1 Strengthening and Empowering the Federal Workforce.

• PMA Priority 2 Delivering Excellent, Equitable, and Secure Federal Services and Customer 

Experience 

• PMA Priority 3 Managing the Business of Government. 
IRS-29

Agency Priority Goal (APG)

The IRS supports the Bureau of Fiscal Service’s (BFS) Improving the Payment Experience APG. The 

purpose of the APG is to create a modern, seamless, inclusive, and secure Federal payment experience for 

the public that meets customer needs while reducing costs, expanding financial inclusion, and improving 

climate sustainability of Treasury’s operations. The IRS continued to partner with BFS and collaborate 

with the tax industry to promote direct deposit for tax refunds and reduce paper checks. A key APG 

milestone, direct deposit capability for amended returns was rolled out on February 5, 2023, at the 

beginning of the current tax filing season. The tax refund electronic payment rate indicator as published in 

the FY 2022 APG report came in at 80.1 percent slightly below the 80.5 percent target for the FY 2022 

fiscal year, in large part due to paper refund check requests related to inventory processing.

FY 2022 Achievements

• Tax Assistance Centers (TACs) served over 900,000 taxpayers in approximately 350 locations 

throughout the country, including assistance during special Saturday hours at designated TACs 

during filing season.

• CI investigated some of the largest and most sophisticated tax crimes and identified more than $31 

billion in tax fraud and other financial crimes.

• IRS used direct hire authority to make on-the-spot offers at several in-person recruitment events 

across the country.

• IRS converted 100 percent of its core legacy code into a modern programming language.

• IRS awarded more than $12.1 million in matching grants to 131 organizations of qualified Low 

Income Taxpayer Clinics (LITC) for the 2022 grant year.

• IRS awarded matching funds to support Volunteer Income Tax Assistance (VITA) and Tax 

Counseling for the Elderly (TCE) tax preparation services in all 50 states and the District of 

Columbia.

FY 2023 Priorities

IRA funding for the IRS will add resources for tax service, enforcement, and technology. Resources 

invested for hiring, training and IT systems will allow the IRS to better serve taxpayers in alignment with 

Treasury’s goals and objectives. 

So far in FY 2023 IRS:

• Hired 5,000 new customer service representatives to staff the phones, resulting in lower wait times 

and a higher number of calls answered.

• Processed historic levels of inventory in the 12 months preceding start of filing season 2023.

• Is on track to triple the number of taxpayers served at TACs (from 900,000 to 2.7 million) by next 

year with increased staffing at TACs to help more taxpayers in-person and having reopened four 

TACs that had been closed for years. 

• As of February 9, implemented the ability for people electronically filing their Form 1040-X, 

Amended U.S Individual Income Tax Return, to select direct deposit for any resulting refund for 

quicker delivery of funds.

• Rolled out a new portal that allows small businesses to submit Forms 1099 online for the first 

time.

• Implementing new technology will allow IRS to scan and electronically process paper returns. The 

IRS will be able to shorten the processing time for taxpayers who file paper returns. IRS projects 

to scan millions of paper returns in Calendar Year 2023.
IRS-30

FY 2024 Initiatives 

In FY 2024 IRS initiatives will support the following Treasury Strategic Objectives:

• Strategies for Improving the Taxpayer Experience will support the following Treasury Strategic 

Objectives: 1.1 - Tax Administration and Policy, 2.1 - Cyber Resiliency of Financial Systems and 

Institutions, 3.3 - Financial Innovation, 5.3 - Better Use of Data, and 5.4 - Customer Experience 

Practices.

• Green Tax Credit Implementation will support the following Treasury Strategic Objectives: 

Objective 4.4 Sustainable Treasury Operations.

• Improve Telephone Level of Service and Reduce Correspondence Inventory will support the 

following Treasury Strategic Objectives: 1.1 - Tax Administration and Policy, 5.4 - Customer 

Experience Practices.

• Restoration of Staffing Levels will support the following Treasury Strategic Objectives: 1.1 - Tax 

Administration and Policy, 2.1 - Cyber Resiliency of Financial Systems and Institutions, 2.4 -

Transparency in the Financial System, 3.3 - Financial Innovation, 5.3 - Better Use of Data, and 5.4 

- Customer Experience Practices.

• Fleet Electrification will support the following Treasury Strategic Objectives: Objective 4.4 

Sustainable Treasury Operations.

• Sustainment of Deployed IT Capabilities will support the following Treasury Strategic Objectives: 

1.1 - Tax Administration and Policy, 5.3 - Better Use of Data.

• Sustaining Infrastructure will support the following Treasury Strategic Objectives: 1.1 - Tax 

Administration and Policy, 5.3 - Better Use of Data.

• Business Systems Modernization will support the following Treasury Strategic Objectives: 1.1 -

Tax Administration and Policy, 3.3 - Financial Innovation, Objective 5.2 Future Work Routines

5.3 - Better Use of Data, and 5.4 - Customer Experience Practices.

Taxpayer Services

Appropriation Description

The Taxpayer Services appropriation provides funding for taxpayer service activities and programs. This 

includes printing forms and publications, processing tax returns and related documents, offering filing and 

account services, taxpayer assistance, and providing taxpayer advocacy services.

The Taxpayer Services budget request for FY 2024 is $3,442,449,000 in direct appropriations and 31,585

FTE. This amount is an increase of $641,843,000 or 23.08 percent, and an increase of 4,704 FTE, or 

17.50 percent from the FY 2023 Enacted Budget of $2,780,606,000 and 26,881 FTE.
IRS-31 

2.1 – Budget Adjustments Table 

See footnotes in 1.1 - Appropriations Detail Table. 

Taxpayer Services

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $2,780,606 26,881 

Changes to Base:

Maintaining Current Levels (MCLs): $132,617

Pay Annualization (4.6% average pay raise) 27,980

Pay Raise (5.2% average pay raise) 99,226

Non-Pay 5,411

Technical Base Adjustments $231,236

Improve Competitiveness of IRS Clerical Staff 44,220

Change in Staffing Designation 187,016

Subtotal Changes to Base $363,853

FY 2024 Current Services $3,144,459 26,881 

Program Increases:

Strategies for Improving the Taxpayer Experience 9,000 35

Green Tax Credit Implementation 75,233 1,221

Improve Telephone Level of Service and Reduce

Correspondence Inventory 193,757 3,448

Subtotal FY 2024 Program Increases $277,990 4,704

FY 2024 President's Budget Request $3,422,449 31,585 

Dollars in Thousands
IRS-32 

2.2 – Object Classification Obligations

Amounts reflect obligations of annually appropriated discretionary resources.

See footnotes in 1.1 - Appropriations Detail Table.

Dollars in Thousands

Taxpayer Services FY 2022 FY 2023 FY 2024

O bject Classification

O perating 

Plan

Estimated

O bligations

Request

11.1 - Full-time permanent 1,611,414 1,633,940 2,066,742

11.3 - Other than full-time permanent 32,475 36,350 38,400

11.5 - Other personnel compensation 177,442 163,314 179,591

11.9 - Personnel Compensation (Total) 1,821,331 1,833,604 2,284,732

12.0 - Personnel benefits 631,613 587,176 761,617

13.0 - Benefits for former personnel 7,156 12,255 12,879

Total Personnel and Compensation Benefits $2,460,100 $2,433,035 $3,059,228

21.0 - Travel and transportation of persons 3,104 10,392 12,220

22.0 - Transportation of things 1,175 494 504

23.3 - Communications, utilities, and miscellaneous charges 1,149 1,194 1,218

24.0 - Printing and reproduction 10,166 10,911 11,130

25.1 - Advisory and assistance services 174,316 140,850 149,695

25.2 - Other services from non-Federal sources 12,407 22,919 23,874

25.3 - Other goods and services from Federal sources 79,435 76,035 79,260

25.6 - Medical care 6,601 2,864 2,921

25.7 - Operation and maintenance of equipment 38 33 34

26.0 - Supplies and materials 3,703 3,815 4,279

31.0 - Equipment 418 411 419

41.0 - Grants, subsidies, and contributions 54,000 77,000 77,000

42.0 - Insurance claims and indemnities 994 653 666

Total Non-Personnel $347,506 $347,571 $363,220

Total O bligations $2,807,606 $2,780,606 $3,422,449

Full-time Equivalents (FTE) 26,698 26,881 31,585
IRS-33 

2.3 – Appropriation Detail Table 

See footnotes in 1.1 - Appropriations Detail Table.

2A – Pre-Filing Taxpayer Assistance and Education 

($823,344,000 in direct appropriations and an estimated $105,000 in reimbursable programs): This 

budget activity funds direct labor and some non-labor expenses to assist with tax return preparation, 

including tax law interpretation, publication, production, and taxpayer advocate services. The program 

activities include: 

• Pre-Filing Services Management supports headquarters staffing and support for Taxpayer 

Advocate Service and Customer Assistance Relationship and Education (CARE) program 

activities. CARE provides pre-filing taxpayer assistance and education.

• Taxpayer Communication and Education researches the needs of customers; develops and 

manages educational programs; establishes partnerships with stakeholder groups; and disseminates 

tax information to taxpayers and the public through a variety of media, including publications and 

mailings, websites, broadcasting, and advertising. 

• Media and Publications develops and produces notices, forms, and publications for printed and 

electronic tax materials, and provides media production services to taxpayers. 

• Taxpayer Advocacy provides advocate services to taxpayers by identifying the underlying causes 

of taxpayer problems and participating in the development of systematic and/or procedural 

remedies. 

• Account Management and Assistance – Field Assistance provides face-to-face assistance, 

education, and compliance services to taxpayers. It includes return preparation, answering tax 

questions, resolving account and notice inquiries, and supplying forms and publications to 

taxpayers. 

• Taxpayer Advocate Case Processing provides advocate services to taxpayers to resolve taxpayer 

problems through prompt identification, referral, and settlement. 

• Wage and Investment (W&I) HQ Management and Administration provides staffing, training, and 

direct support for W&I management activities of strategic planning, communications and liaison, 

Dollars in Thousands

Taxpayer Services

Appropriated Resources

New Appropriated Resources FTE AMO UNT FTE AMO UNT FTE AMO UNT FTE AMO UNT

Pre-Filing Taxpayer Assistance and Education 4,337 680,261 4,985 784,380 5,018 823,344 0.7% 5.0%

Filing and Account Services 22,361 2,127,345 21,896 1,996,226 26,567 2,599,105 21.3% 30.2%

Subtotal New Appropriated Resources 26,698 $2,807,606 26,881 $2,780,606 31,585 $3,422,449 17.5% 23.1%

O ther Resources

Reimbursable 392 32,580 529 44,000 556 46,200 5.1% 5.0%

Offsetting Collections (Non-reimbursable)

User Fees 71 78,900 71 3,900 71 3,900

Recoveries from Prior Years 1 7,399 7,399

Unobligated Balances from Prior Years 4,496 429,056 118,195 -100.0%

IRA Funding Usage 1,073 7,394 837,735 6,489 815,966 -12.2% -2.6%

Transfers In/Out

Resources from Other Accounts 1 107

Subtotal O ther Resources 4,960 $541,717 7,994 $1,011,229 7,116 $873,465 -11.0% -13.6%

Total Budgetary Resources 31,658 $3,349,323 34,875 $3,791,835 38,701 $4,295,914 11.0% 13.3%

FY 2022 FY 2023 FY 2024 FY 2023 to FY 2024

O perating Plan Enacted Request % Change
IRS-34 

finance, human resources, equity, diversity and inclusion, business modernization, and embedded 

training. 

• Taxpayer Services Research provides resources to support taxpayer services by conducting 

taxpayer behavioral studies, data analysis, and uses advanced analytics to deliver results and 

conclusions to inform business decisions to improve IRS products and services. 

Description of FY 2022 Performance – Pre-Filing and Taxpayer Assistance 

In FY 2022, the Timeliness of Critical Individual Filing Season (CIFS) Tax Products to the Public (i.e., 

tax forms, schedules, instructions, and publications) was 96.4 percent, 8.3 percent above the target of 

89 percent and a 4.8 percent increase over FY 2021. In FY 2022, 81 of 84 CIFS tax products were 

available to the public in a timely manner. Critical tax product timeliness is defined as making tax 

products available to the public seven calendar days before the official IRS start of the (individual) filing 

season. IRS prioritized work on the release of critical products, especially forms and instructions, over 

other products; utilized overtime, credit, and compensatory time during workdays, weekends, and 

holidays; and utilized workload planning and monitoring by management to exceed the target. The IRS 

expects to achieve a target of 83 percent for FY 2023 and 89 percent in FY 2024. 

In FY 2022, the IRS Timeliness of Critical Tax TE/GE and Business (CTB) Filing Season Tax products 

to the Public was 96 percent, 7.9 percent above the target of 89 percent and a 3.3 percent increase 

compared to FY 2021. In FY 2022, 72 of 75 tax products were available to the public in a timely manner. 

There were five more tax products included FY 2022 compared to FY 2021. Additional factors that 

contributed to exceeding this year’s target include prioritizing work on the release of critical products; 

granting of overtime, credit, and compensatory time during workdays, weekends, and holidays; and 

workload planning and monitoring by management as well as the efforts of our employees. The IRS 

expects to achieve a target of 85 percent for FY 2023 and 87 percent in FY 2024. 
IRS-35

The Enterprise Self-Assistance Participation Rate (ESAPR) represents the percent where a taxpayer uses 

one of the IRS’s self-assistance service channels (e.g., automated calls, web services) versus needing 

support from an IRS employee (e.g., face-to-face, over the phone, or via paper correspondence). The 

ESAPR of 93.9 percent was 3.2 percent higher than the target of 91.0 percent. In FY 2022, the total 

self-assisted services of 1.5 billion were around 29 percent higher than FY 2021 of 1.16 billion. Total 

assisted services of 97.5 million were nearly equal to the 97.6 million in FY 2021. Total services were 

1.6 billion compared to the 1.26 billion in FY 2021. Beginning in FY 2022, ESAPR included Business 

Master File data in the installment agreements, Online Payment Agreements, electronic payments, and 

paper payments for a more inclusive metric. The IRS expects to achieve a target of 94 percent for FY 

2023 and 93 percent for FY 2024.

116.9 106.6 86.9 97.6 97.5

82.0% 85.4%

90.6%

92.3%

93.9%

0

500

1000

1500

2000

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Enterprise Self-Assistance Participation Rate

and Services Used (Millions)

Self-Assisted Services ESAPR
IRS-36 

FY 2024 Changes by Budget Activity

 See footnotes in 1.1 - Appropriations Detail Table. 

2.1.1 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding.

Pre-Filing Taxpayer Assistance and Education

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $784,380 4,985 

Changes to Base:

Maintaining Current Levels (MCLs): $34,571

Pay Annualization (4.6% average pay raise) 7,589

Pay Raise (5.2% average pay raise) 26,032

Non-Pay 950

Subtotal Changes to Base $34,571

FY 2024 Current Services $818,951 4,985 

Program Increases:

 Strategies for Improving the Taxpayer Experience 4,393 33 

Subtotal FY 2024 Program Increases $4,393 33

FY 2024 President's Budget Request $823,344 5,018 

Dollars in Thousands

Dollars in thousands

Pre-Filing Taxpayer Assistance & Education FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $640,379 $621,907 $632,893 $658,344 $680,261 $784,380 $823,344

Reimbursable Resources2 260 118 578 142 75 100 105

Budget Activity Total $640,639 $622,025 $633,471 $658,486 $680,336 $784,480 $823,449

Pre-Filing Taxpayer Assistance & Education FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measure Actual Actual Actual Actual Actual Target Target Target

Timeliness of Critical Filing Season Tax 

Products to the Public 59.6% 92.6% 78.4% 92.0% 96.4% 89.0% 83.0% 89.0%

Timeliness of Critical TE/GE & Business Tax 

Products to the Public 100.0% 96.1% 96.0% 92.9% 96.0% 89.0% 85.0% 87.0%

Enterprise Self Assistance Participation Rate 82.0% 85.4% 90.6% 92.3% 93.9% 91.0% 94.0% 93.0%
IRS-37 

2B – Filing and Account Services

($2,599,105,000 in direct appropriations, $46,095,000 from reimbursable programs, and $3,900,000 

from user fees): This budget activity funds direct labor and non-labor expenses that provide filing and 

account services to taxpayers, process paper and electronically submitted tax returns, issue refunds, and 

maintain taxpayer accounts. The public continues to file more returns electronically, with 91.7 percent of 

individual returns filed electronically during the 2022 filing season—an increase of 2.2 percent over 2021. 

The program activities include:

• Filing and Account Services Management administers filing and account services programs. 

• Submission Processing processes paper and electronically submitted tax returns and supplemental 

documents, accounts for tax revenue, processes information documents, and issues refunds and tax 

notices. 

• Account Management and Assistance – Electronic/Correspondence Assistance provides education 

and assistance to taxpayers and resolves accounts and notice inquiries through telephone, paper, 

and internet correspondence.

• Electronic Products and Services Support (EPSS) provides centralized operations and support 

capabilities for the IRS suite of electronic products, including e-help desk, technology support, 

and operations support. 

• Electronic Tax Administration (ETA) markets and administers electronic tax administration 

products and services.

• Joint Operations Center (JOC) provides service, support, and technology for telephone, 

correspondence, and electronic media inquiries; real time monitoring and routing of inbound calls; 

monitoring of Customer Service Representative (CSR) accuracy; and management of the 

enterprise telephone database.

Description of FY 2022 Performance – Filing and Account Services 

In FY 2022 Customer Accuracy - Tax Law, which is the percent of correct answers given by a live 

assistor on toll-free tax law inquiries, was 92 percent, which was 3.4 percent above the target of 

89 percent. The IRS will continue to monitor results through data-driven analysis of reports to achieve 

future goals. Ongoing efforts have and will continue to focus on production meetings with field sites, 

promoting coding consistency of product reviews, and providing training to managers and employees to 

ensure quality service to customers. The IRS set the Tax Law Accuracy target at 87 percent for FY 2023 

and 89 percent for FY 2024. 

In FY 2022 Customer Accuracy - Accounts, which is the percent of correct answers given by a live 

assistor on toll-free account inquiries, was 91.8 percent, which was 3.1 percent above the target of 

89 percent. The IRS will continue to monitor results through data-driven analysis of reports to achieve 

future goals. Ongoing efforts have and will continue to focus on production meetings with field sites, 

promoting coding consistency of product reviews, and providing training to managers and employees to 

ensure quality service to customers. The IRS set the Tax Law Accounts target at 87 percent for FY 2023 

and 89 percent for FY 2024. 

The Customer Service Representative (CSR) Level of Service (LOS) measures the relative success rate of 

taxpayers wanting to speak with an assistor. In FY 2022, CSR LOS was 17.4 percent which was 

42 percent below the target of 30 percent. This decrease was due to the IRS reducing phone staffing to 

focus on working the paper inventory backlog that had accumulated because of the pandemic. In 
IRS-38

FY 2022, IRS made substantial progress, closing 116.4 percent of receipts, contributing to the significant 

reduction in year-end inventory compared to FY 2021. Phone Demand in FY 2022 of 81.3 million was 32 

percent lower than the 2021 figure of 119.9 million, but still substantially higher than the average 

pre-pandemic phone demand of 40 million. In FY 2022, total ending inventory was 2.1 million, a 

significant decrease compared to the 4.1 million at the same time in FY 2021. The Primary Abandoned 

Call Rate of 18.2 percent in FY 2022 was 21 percent lower than FY 2021. IRS will continue to monitor 

demand in real time and adjust resource allocations to regularly shift staff between telephones and paper 

processing to address demand. With the receipt of funding from the IRA, IRS plans to deliver a higher 

level of service in FY 2023. 

From the beginning of filing season, which started on January 23, 2023, through March 6, 2023, the 

telephone level of service on individual toll-free lines was 85.85 percent compared to about 24 percent at 

this point in time last year. The average speed to answer time was 5 minutes compared to 23 minutes at 

this point in time last year. The total number of assistor calls answered was 2.9 million, a 23 percent 

increase over last year’s 2.4 million calls answered at this point in time.

FY 2022 LOS Assistor Calls 

Answered (Millions)

Level of Service

(Percent)

Automated Calls Answered 

(Millions)

Accounts 

Management/CSR 13.3 17.4 33.6

Collection/ACS 5.0 35.1 0.83

Enterprise 21.7 21.3 35.1

In FY 2022, the IRS developed and implemented two new inventory indicators. These indicators provide 

a full picture of the CSRs whose daily priorities include both answering phones and processing paper 

inventory. The indicators measure the total ending accounts management adjustments and correspondence 

inventory and the percentage of that inventory that was closed during the fiscal year compared to the 

amount received. These provide a clear picture of the volume of work as well as the progress made in 

reducing outstanding case amounts compared to current year receipts.

The IRS is committed to continuing to deliver an improved experience for taxpayers. For FY 2023, the

IRS is striving to achieve an 85 percent LOS during the 2023 individual filing season and a 60 percent

LOS for the entire fiscal year as CSRs continue to balance answering phones with processing the elevated 

paper inventory. 

For FY 2024, the IRS intends to onboard additional CSRs to further improve LOS, process the paper 

inventory, and reduce the need to realign resources from other priority functions to support filing season. 

The IRS will again strive to achieve an 85 percent LOS during individual filing season and deliver an

80 percent cumulative LOS for the fiscal year. The IRS will also continue to explore opportunities to 

deliver an even higher level of service through the rollout of additional self-service options, internal 

process improvements, and technology modernization.

In addition to live assistors, the IRS also provides phone service to taxpayers using automation. During 

FY 2022, nearly 34 million taxpayers received the answer to their questions through automation. To help 

capture the volume of this assisted population, the IRS is developing a measure for inclusion in 

performance reporting that expands on Customer Service Representative (CSR) LOS to include these 

automated calls. The new measure, LOS(A), for FY 2022 was 39.3 percent and IRS intends to baseline 

this measure in FY 2023.
IRS-39

The Taxpayers Satisfied with the IRS indicator – the former All Individual Tax Filers Score--is based on 

the annual American Customer Satisfaction Index (ACSI) Survey, which is the only uniform, 

cross-industry/government measure of customer satisfaction with the quality of goods and services 

available to U.S. residents. The measure is calculated as a weighted combination of the ACSI Individual 

Electronic Tax Filer and Individual Paper Tax Filer Customer Satisfaction Index scores based on a 

100-point scale. The Taxpayers Satisfied with the IRS measure declined one point in 2022 to 69. The IRS 

experienced pandemic-related issues that were still affecting IRS operations during the 2022 ACSI 

survey. Unprecedented amounts of unprocessed paper returns and correspondence that contributed to 

higher call volumes and related taxpayer inquiries likely affected the drop in the 2022 ACSI Taxpayers 

Satisfied with the IRS measure. 

0

20

40

60

80

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Taxpayers Satisfied with the IRS
IRS-40 

FY 2024 Changes by Budget Activity

 See footnotes in 1.1 - Appropriations Detail Table. 

Filing and Account Services

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $1,996,226 21,896 

Changes to Base:

Maintaining Current Levels (MCLs): $98,046

Pay Annualization (4.6% average pay raise) 20,391

Pay Raise (5.2% average pay raise) 73,194

Non-Pay 4,462

Technical Base Adjustments $231,236

Improve Competitiveness of IRS Clerical Staff 44,220

Change in Staffing Designation 187,016

Subtotal Changes to Base $329,282

FY 2024 Current Services $2,325,508 21,896 

Program Increases:

 Strategies for Improving the Taxpayer Experience 4,607 2 

 Green Tax Credit Implementation 75,233 1,221 

 Improve Telephone Level of Service and Reduce

 Correspondence Inventory 193,757 3,448 

Subtotal FY 2024 Program Increases $273,597 4,671

FY 2024 President's Budget Request $2,599,105 26,567 

Dollars in Thousands
IRS-41 

2.1.2 - Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

 

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding. 1 The CSR LOS includes toll-free telephone lines answered by Accounts Management assistors only. The IRS will strive to achieve an 85 percent LOS during

 individual filing season for both FY 2023 and FY 2024. 2 Historical data provided for comparative purposes. 3 Based on the American Customer Satisfaction Index (ACSI) survey; the All-Individual Tax Filer score is calculated from separate ACSI Individual Paper 

 Filer and Electronic Filer. 

Enforcement

Appropriation Description 

The Enforcement appropriation provides funding for the examination of tax returns, both domestic and 

international; administrative and judicial settlement of taxpayer appeals of examination findings; technical 

rulings; monitoring of employee pension plans; determination of qualifications of organizations seeking 

tax-exempt status; examination of tax returns of exempt organizations; enforcement of statutes relating to 

detection and investigation of criminal violations of the internal revenue laws; identification of 

underreporting of tax obligations; securing of unfiled tax returns; and collection of unpaid accounts. The 

IRS has experienced significant staff attrition over the past ten years, with a loss of over 10,000 positions 

since 2012, predominately within the compliance function. While the IRA provided the IRS with 

significant resources for a transformative expansion of its tax enforcement efforts, there remains a need 

for a reversal of the multi-year inflation-adjusted decline in the IRS’s foundational staffing resources. 

The Enforcement budget request for FY 2024 is $5,904,441,000 in direct appropriations and 34,890 FTE. 

This amount is an increase of $466,819,000 or 8.58 percent, and 550 FTE or 1.60 percent more than the 

FY 2023 Enacted Budget of $5,437,622,000 and 34,340 FTE. 

Dollars in thousands

Filing and Account Services FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $1,712,511 $1,872,175 $1,901,467 $1,927,220 $2,127,345 $1,996,226 $2,599,105

Reimbursable Resources2 34,905 62,794 72,769 39,307 32,505 43,900 46,095

User Fees2 69,987 3,900 64,900 78,900 3,900 3,900

Budget Activity Total $1,817,403 $1,938,869 $1,974,236 $2,031,427 $2,238,750 $2,044,026 $2,649,100

Filing and Account Services FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measures Actual Actual Actual Actual Actual Target Target Target

Customer Accuracy - Tax Law (Phones) 95.5% 91.6% 91.0% 92.8% 92.0% 89.0% 87.0% 89.0%

Customer Accuracy - Accounts (Phones) 96.1% 94.3% 93.5% 93.0% 91.8% 89.0% 87.0% 89.0%

Customer Service Representative (CSR) Level of Service (LOS)1 75.9% 65.4% 53.1% 18.5% 17.4% 30.0% 60.0% 80.0%

Total Ending Inventory (Millions) (New FY 2022)2 600 1,100 1,100 4,100 2,156 Indicator Indicator Indicator

Percent of Closures to Receipts (New FY 2022)2 99.0% 92.7% 99.6% 71.9% 116.4% Indicator Indicator Indicator

LOS(A) (New FY 2023)2 86.7% 79.2% 71.6% 38.2% 39.3% N/A Baseline TBD

Taxpayers Satisfied with the IRS (based on a 100 point scale)3 74 73 74 70 69 Indicator Indicator Indicator
IRS-42 

2.1 – Budget Adjustments Table

See footnotes in 1.1 - Appropriations Detail Table. 

Enforcement

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $5,437,622 34,340 

Changes to Base:

Maintaining Current Levels (MCLs): $261,401

Pay Annualization (4.6% average pay raise) 56,683

Pay Raise (5.2% average pay raise) 194,545

Non-Pay 10,173

Technical Base Adjustments $50,234

FERS Law Enforcement Rate Increase 50,234

Subtotal Changes to Base $311,635

FY 2024 Current Services $5,749,257 34,340 

Program Increases:

Restoration of Staffing Levels 143,115 547

Fleet Electrification 12,069 3

Subtotal FY 2024 Program Increases $155,184 550

FY 2024 President's Budget Request $5,904,441 34,890 

Dollars in Thousands
IRS-43 

2.2 – Object Classification Obligations

Amounts reflect obligations of annually appropriated discretionary resources. 

See footnotes in 1.1 - Appropriations Detail Table. 

Dollars in Thousands

Enforcement FY 2022 FY 2023 FY 2024

O bject Classification

O perating 

Plan

Estimated

O bligations

Request

11.1 - Full-time permanent 3,269,199 3,282,284 3,528,623

11.3 - Other than full-time permanent 25,703 28,393 30,206

11.5 - Other personnel compensation 165,590 155,797 166,266

11.8 - Special personal services payments 36,143 69,079 72,598

11.9 - Personnel Compensation (Total) 3,496,635 3,535,553 3,797,693

12.0 - Personnel benefits 1,375,954 1,393,110 1,504,610

13.0 - Benefits for former personnel 106 298 313

Total Personnel and Compensation Benefits $4,872,695 $4,928,961 $5,302,616

21.0 - Travel and transportation of persons 28,433 94,359 102,176

22.0 - Transportation of things 8,300 11,123 21,614

23.2 - Rental payments to others 193 219 226

23.3 - Communications, utilities, and miscellaneous charges 4,697 7,288 7,476

24.0 - Printing and reproduction 3,221 3,425 3,502

25.1 - Advisory and assistance services 310,470 222,081 280,387

25.2 - Other services from non-Federal sources 25,216 46,678 57,387

25.3 - Other goods and services from Federal sources 37,596 59,750 62,326

25.4 - Operation and maintenance of facilities 5 4 4

25.6 - Medical care 4,075 1,997 2,037

25.7 - Operation and maintenance of equipment 1,390 1,929 2,435

26.0 - Supplies and materials 24,780 38,457 39,576

31.0 - Equipment 12,737 12,384 13,532

42.0 - Insurance claims and indemnities 22,314 967 986

91.0 - Unvouchered 7,500 8,000 8,160

Total Non-Personnel $490,927 $508,661 $601,824

Total O bligations $5,363,622 $5,437,622 $5,904,441

Full-time Equivalents (FTE) 35,550 34,340 34,890
IRS-44 

2.3 – Appropriation Detail Table

1

The FY 2024 FTE percentage change reflects only the Enforcement increase. The FY 2024 IRA Funding Usage FTE in Enforcement represent 7 percent of 

the total discretionary request FTE. 

See footnotes in 1.1 - Appropriations Detail Table. 

2C – Investigations 

($818,021,000 in direct appropriations, and an estimated $44,730,000 from reimbursable programs): 

This budget activity funds the Criminal Investigation (CI) programs that explore potential criminal and 

civil violations of tax laws; enforce criminal statutes relating to violations of tax laws and other financial 

crimes; and recommend prosecution as warranted. The program activities include: 

• General Management and Administration supports the headquarters management activities of 

strategic planning, communications, finance, and human resources for CI activities.

• CI supports the enforcement of criminal statutes relating to violations of internal revenue laws and 

other financial crimes. CI investigates cases of suspected intent to defraud involving both legal 

and illegal sources of income and recommends prosecution as warranted. This activity includes the 

investigation and prosecution of tax and money-laundering violations associated with narcotics 

organizations. 

• Criminal Tax Legal Support provides legal advice and support from IRS Counsel to CI. 

• International Investigations provides policy, guidance, strategic planning, and investigative 

support impacting international investigations, travelers and personnel stationed abroad. 

International investigations involve U.S. citizens residing abroad, non-resident aliens, expatriates, 

and other international issues. This activity includes support for international 

programs/investigations such as Foreign Account Tax Compliance Act (FATCA), Organization 

for Economic and Cooperation Development (OECD), Joint Chiefs of Global Tax Enforcement 

(J5), International Fraud Referrals/Schemes, transnational organized crime, narcotics, and 

counterterrorism.

Dollars in Thousands

Enforcement

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Investigations 3,004 700,876 3,076 744,590 3,130 818,021 1.8% 9.9%

Exam and Collections 31,599 4,447,716 30,320 4,521,758 30,735 4,897,493 1.4% 8.3%

Regulatory 947 215,030 944 171,274 1,025 188,927 8.6% 10.3%

Subtotal New Appropriated Resources 35,550 $5,363,622 34,340 $5,437,622 34,890 $5,904,441 1.6% 8.6%

Other Resources

Reimbursable 56 38,706 69 47,000 73 49,350 5.8% 5.0%

Offsetting Collections (Non-reimbursable) 29,687 33,836 35,625 5.3%

User Fees 5,054

Recoveries from Prior Years 2,945 4,231 4,231 0.0%

Unobligated Balances from Prior Years 2 252,740 1,802 269,083 250,000 -7.1%

IRA Funding Usage1 1,543 371,767 7,239 1,408,470 369.2% 278.9%

Transfers In/Out 85 119 119 0.0%

Resources from Other Accounts 410 93,657 435 122,110 435 122,110 0.0%

Subtotal Other Resources 468 $422,874 3,849 $848,146 7,747 $1,869,905 101.3% 120.5%

Total Budgetary Resources 36,018 $5,786,496 38,189 $6,285,768 42,637 $7,774,346 11.6% 23.7%

FY 2022 FY 2023 FY 2024 FY 2023 to FY 2024

Operating Plan Enacted Request % Change
IRS-45 

• Cybersecurity supports CI’s cyber-efforts around inherent risks to CI’s networks and systems, by 

focusing enforcement and investigative actions on the criminals that pose those threats. This 

activity also supports security program management that protects the safeguarding of all data and 

systems within CI and adhering to all federal regulatory security compliance mandates and local 

security policies. 

Description of FY 2022 Performance – Investigations

CI serves the American public by investigating potential criminal violations of the Internal Revenue Code 

and related financial crimes in a manner that fosters confidence in the tax system and compliance with the 

law. CI uses the following measures to evaluate its success in achieving its mission. 

In FY 2022, CI completed 2,552 Criminal Investigations, missing the year-end target of 2,600 by 

1.8 percent. Prosecutions recommended for legal-sourced income cases and narcotics cases decreased 

3.1 and 23.4 percent, respectively, compared to the same period in FY 2021. Prosecutions recommended 

for illegal-sourced income cases increased 3.2 percent. Legal source cases include people that earn their 

income legally, but willfully violate the tax laws (tax evasion). Examples of illegal cases include 

embezzlement, mortgage fraud, telemarketing fraud, and money laundering. Narcotics cases are like 

illegal cases; however, these cases are specific to profits and financial gains of organized crime groups 

involved in narcotics, narcotics trafficking, and money laundering. The measure, Criminal Investigations 

completed, decreased compared to last year as COVID-19 pandemic continued to impact day-to-day 

investigative activities thereby contributing to a higher cycle time for investigations completed. Based on 

projected staffing levels and setbacks and challenges presented due to the COVID-19 pandemic, the IRS 

has set a target of 2,500 for FY 2023 and FY 2024. 

The FY 2022 Conviction Rate of 90.6 percent was 1.5 percent below the year‐end target of 92.0 percent 

while convictions are up 23.8 percent from 1,263 in FY 2021 to 1,564 in FY 2022. The COVID-19 

pandemic continues to limit court availability throughout the country and impact day-to-day investigative 

activities in support of the judicial system, contributing to less cases being processed than in years before 

 -

 1,000

 2,000

 3,000

 4,000

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Criminal Investigations Completed 

and Associated FTE

Criminal Investigations Completed FTE for Criminal Investigations
IRS-46 

COVID-19. Additionally, decreases in the number of special agents in previous years has led to a decline 

in the total amount of cases initiated and consequently recommended for prosecution. Despite this, 

appropriate case selection and effective field performance continue to positively affect the quality of cases 

resulting in convictions. The IRS will keep the Conviction Rate targets for FY 2023 and FY 2024 at 92.0 

percent. 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table

0.0%

20.0%

40.0%

60.0%

80.0%

100.0%

 -

 500

 1,000

 1,500

 2,000

 2,500

 3,000

 3,500

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Convictions vs. Conviction Rate

Convictions Conviction Rate

Investigations

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $744,590 3,076 

Changes to Base:

Maintaining Current Levels (MCLs): $34,696

Pay Annualization (4.6% average pay raise) 7,359

Pay Raise (5.2% average pay raise) 25,244

Non-Pay 2,093

Technical Base Adjustments $6,976

FERS Law Enforcement Rate Increase 6,976

Subtotal Changes to Base $41,672

FY 2024 Current Services $786,262 3,076 

Program Increases:

 Restoration of Staffing Levels 19,690 52 

 Fleet Electrification 12,069 2 

Subtotal FY 2024 Program Increases $31,759 54

FY 2024 President's Budget Request $818,021 3,130 

Dollars in Thousands
IRS-47 

2.1.3 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees. 

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding. 1 The impact of hiring on performance is not immediate due to required academy and on-the-job training (6+ months) as well as the average cycle time it takes 

to complete an investigation (400-500 days).

2D – Exam and Collections 

($4,897,493,000 in direct appropriations, and an estimated $4,095,000 from reimbursable programs): 

This budget activity funds programs that enforce the tax laws and increase compliance through 

examination and collection programs that ensure proper payment and tax reporting. This budget activity 

also includes campus support of the Questionable Refund program and appeals, and litigation activities 

associated with exam and collection. The program activities include: 

• Compliance Services Management supports management associated with exam and compliance 

program activities.

• Payment Compliance – Correspondence Collection supports IRS collection activities by initiating 

contact and collecting delinquent taxpayer liabilities through written notices and other means. 

• Automated Collections and Support initiates contact and collects delinquent taxpayer liabilities 

through the centralized Automated Collection System (ACS). 

• Payment Compliance – Field Collection conducts field investigations and collection efforts 

associated with delinquent taxpayer and business entity liabilities, including direct taxpayer 

contact and outreach programs to protect the interest of the federal government in delinquent tax 

liability situations. 

• Tax Reporting Compliance – Document Matching supports the Automated Under Reporter 

(AUR), Combined Annual Wage Reporting (CAWR), Federal Unemployment Tax Act (FUTA), 

and other document matching programs. 

• Tax Reporting Compliance – Electronic/Correspondence Exam initiates written correspondence 

with taxpayers related to tax issues arising from claims on their tax returns. 

• Tax Reporting Compliance – Field Exam compares taxpayer income levels and corresponding tax 

liabilities to ensure the accuracy of taxpayer returns. 

• Fraud/Bank Secrecy Act enforces the anti-money laundering provisions of the Bank Secrecy Act 

of 1970 (BSA) and the USA Patriot Act of 2001. It examines non-bank financial institutions for 

compliance with these laws, receives and processes more than 15 million financial reports 

annually, and manages a centralized database of information for the Financial Crimes 

Enforcement Network. The Fraud program follows the “money trail” to support CI of tax evasion 

operations. Fraud technical advisors and revenue agents provide investigative leads and referrals 

to federal, state, and local law enforcement agencies. 

Dollars in thousands

Investigations FY 2018 FY 2019 FY 2020 FY 2021 FY2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $581,680 $595,686 $619,227 $630,093 $700,876 $744,590 $818,021

Reimbursable Resources2 28,295 27,749 41,233 1,950 37,092 42,600 44,730

Budget Activity Total $609,975 $623,435 $660,460 $632,043 $737,968 $787,190 $862,751

Investigations FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measures Actual Actual Actual Actual Actual Target Target Target

Criminal Investigations Completed1 3,051 2,797 2,624 2,766 2,552 2,600 2,500 2,500

Conviction Rate 91.7% 91.2% 90.4% 89.4% 90.6% 92.0% 92.0% 92.0%
IRS-48 

• Appeals supplies an administrative review process that provides a channel for impartial case 

settlement before a case is docketed in a court of law. 

• Litigation provides legal support for the IRS in litigation of cases, including interpretation of the 

tax law.

• Specialty Programs – Exams examines federal tax returns of businesses and individuals 

responsible for the filing and payment of employment, excise, estate, and gift taxes. 

• International Collection supports international field collection efforts associated with delinquent 

taxpayer and business entity liabilities from U.S. citizens residing abroad, non-resident aliens, 

expatriates, and those involving other international issues (e.g., Foreign Tax Credit and Foreign 

Earned Income Exclusion). 

• International Exams supports the international exam program involving U.S. citizens residing 

abroad, non-resident aliens, expatriates, and other examinations involving other international 

issues including legal support (e.g., Foreign Tax Credit and Foreign Earned Income Exclusion, 

Corporations, Non-Profits, Pension Plans, etc.). 

• Enforcement Research provides resources for market-based research to identify compliance issues, 

for conducting tests of treatments to address noncompliance, and for the implementation of 

successful treatments of taxpayer non-compliant behavior. 

• Unit General Management and Administration provides staffing, training, and direct support for 

the unit headquarters management activities of strategic planning, communications and liaison, 

finance, human resources, Equal Employment Opportunity and diversity, and business systems 

planning and embedded training. 

• Earned Income Tax Credit (EITC) Management and Administration supports headquarters 

management associated with EITC program service wide. 

• Integrity and Verification Operations supports IRS civil fraud detection and prevention efforts in a 

pre-refund environment, which include monitoring program performance and developing policy, 

procedures, and guidance for processing civil revenue protection program(s). 

• Whistleblower Office provides staffing, training, and direct support to process, assess, and analyze 

tips from individuals who identify tax problems during their daily business, regardless of where 

encountered (including workplace). 

• Communications and Liaison coordinates local government and liaison relationships; manages 

congressional, state, and national stakeholder relationships and issues; coordinates crosscutting 

issues, including audit management and legislative implementation; manages national media 

contacts and local media relationships; and ensures compliance with disclosure and privacy laws.

• Return Integrity, Verification and Program Management provides policy and program oversight of 

revenue protection efforts such as detection, prevention, and treatment of improper refunds 

(identity theft and non-compliance), including managing systemic solutions regarding payment of 

valid refund claims and the development of innovative technology solutions supporting IRS-wide 

revenue protection strategies. 

Description of FY 2022 Performance – Exam

The Examination program provides taxpayers top quality service by helping them understand and meet 

their tax responsibilities and by applying the tax law with integrity and fairness. The performance metrics 

IRS uses to gauge the Examination program’s performance are discussed below. 
IRS-49

Exam Starts – High Income Individual is a measure to monitor resources associated with examinations 

of individual return filers reporting over $10 million of total positive income. The IRS started 3,625 new 

High-Income Individual tax return examinations in FY 2022, while also continuing to allocate resources 

to work the exams started in prior fiscal years. When comparing FY 2022 to the 2,227 new High-Income 

Individual tax return examinations started in FY 2021, there was an increase of 62.8 percent. Throughout 

the year, the IRS will monitor resources, work in process and planned starts, and continue to devote senior 

level staff to train new hires. New hires generally take time to fully contribute to casework due to training.

IRS expects to start 3,817 cases in FY 2023 and 4,830 in FY 2024.

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Exam Starts – High Income 

Individuals 2,307 2,108 2,693 2,227 3,625

Exam Starts – Partnerships is a measure to monitor resources associated with the examination of 

Partnership returns. The IRS started 3,155 new Partnership tax return examinations in FY 2022, while

also continuing to allocate resources to work the exams started in prior fiscal years. Projected 

examinations are trending up for partnerships due to new hires, who recently completed training.

However due to the timing of hiring and the start date of their lengthy training cycle, the impact of hiring 

from IRA funding on performance will not be realized until at least FY 2025 and the FY 2024 target is 

lower than FY 2023. In FY 2023 the IRS expects to start 8,852 cases and 5,253 in FY 2024.

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Exam Starts – Partnerships 9,033 5,823 4,106 4,327 3,155

Exam Starts – Large Corporations is a measure to monitor resources associated with examinations of 

large corporate returns reporting assets of $250 million and above. The IRS started 1,365 new Large 

Corporation tax return examinations in FY 2022. New Revenue Agents require additional training to work 

these cases and the average case cycle time is about 36 months for these large corporations so the impact 

of hiring on performance is not immediate. Targets in FY 2024 are lower due to the training needs of new 

hires, case cycle time, and resources being applied to work High Income Individual and Partnership cases 

(more than 2,500 total in FY 2023 and 2,800 in FY 2024). In FY 2023 IRS expects to start 1,121 cases 

and 947 in FY 2024.

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Exam Starts – Large Corporations 2,396 2,009 1,700 1,490 1,365

Exam Efficiency – Individual is the sum of all individual 1040 returns closed divided by the total FTE 

expended in relation to those individual returns. Exam Efficiency – Individual was 101 in FY 2022, while

exceeding the target of 100, this measure fell 6.5 percent from 108 in FY 2021. The FY 2023 target is set 

at 92 and FY 2024 at 80. The IRS will closely monitor starts and inventory levels to ensure the targets are 

met.
IRS-50 

Time to Start Compliance Resolution is the percentage of all individual income tax enforcement cases 

started within six months of the return posting date. This indicator reflects the effect of expedited issue 

detection and more integrated enforcement approaches. It supports expedited document matching and 

enhanced anomaly detection, which leads to faster issue identification and data and analytics that improve 

issue identification and treatment selection. For FY 2022, the percent of individual enforcement cases 

started within 6 months was 68 percent, a 3 percent increase from FY 2021. 

Time to Resolve Compliance Issue After Filing is the median time it takes to close all individual 

income tax enforcement cases in days. This indicator reflects the complete life cycle from return filing to 

resolution. It also reflects the effect of process enhancements, such as new self-correction capabilities, 

including Online Account. It supports expedited document matching and enhanced anomaly detection, 

which will lead to faster issue identification. For FY 2022, the overall Time to Resolve Compliance Issue 

After Filing was 404 days, a 16.5 percent decrease compared to FY 2021. 

Repeat Non-Compliance Rate is the percentage of individual taxpayers with repeat non-compliance two 

years after the initial tax year for filing, payment or reporting compliance. This indicator supports 

expedited document matching and enhanced anomaly detection, leading to faster issue identification. It 

also promotes improved customer service through expanded access to new self-correction capabilities and 

improved behavioral analytics. It allows the IRS to better understand and change non-compliant taxpayer 

behavior. For FY 2022, the Repeat Non-Compliance Rate was 28.1 percent compared to 30.7 percent for 

FY 2021. 

Description of FY 2022 Performance ‒ Collection 

The Collection program collects delinquent taxes, secures delinquent tax returns through the fair and 

equitable application of tax laws, and provides education to customers to promote future compliance. The 

performance goals that the IRS uses to gauge collection program performance are discussed below. 

Time to Start FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Collection 86.7% 80.1% 85.6% 86.0% 85.0%

Bal Due 90.3% 90.5% 90.2% 88.0% 87.0%

AUR 0.1% 0.1% 0.1% 0.0% 0.0%

Exam 41.8% 39.3% 39.3% 52.0% 40.0%

Total 60.1% 60.9% 66.3% 66.0% 68.0%

Time to Resolve FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Collection: Bal due notice 368 330 400 286 246

Collection: non-notice 755 373 345 491 757

AUR 581 602 618 756 651

Exam 502 551 597 626 550

Total 494 469 491 484 404

Repeat Non-Compliance Rate FY 2018 FY 2019 FY 2020 FY 2021 FY 2022

Reporting 7.4% 7.7% 8.1% 5.5% 4.03%

Filing 38.1% 39.8% 43.9% 39.6% 39.81%

Payment 30.5% 29.9% 28.6% 29.0% 23.5%

Total 30.0% 31.4% 35.6% 30.7% 28.1%
IRS-51 

The Collection Coverage measure is calculated by taking the total volume of collection work completed 

divided by total collection work available. Collection Coverage was 38.3 percent, exceeding the FY 2022 

target of 36.5 percent. Based on the additional staff we will be hiring with the additional IRA funding; the 

target will be set at 33.4 percent for FY 2023 and 34.8 percent for FY 2024. 

The Cost to Collect to $100 is computed as total operating costs divided by gross collection and then 

multiplied by 100. Total operating costs exclude costs reimbursed by other federal agencies and private 

entities for services performed for these external parties. Gross collections are before refunds are issued 

and include penalties and interest in addition to taxes collected. The FY 2022 Cost to Collect $100 was 

29 cents, compared to 33 cents for FY 2021. In FY 2022, total operating costs were approximately 

$14.2 billion, while gross collections were approximately $4.9 trillion. Gross collections increased 

approximately 19 percent from FY 2021 to FY 2022. 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table. 

Exam and Collections

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $4,521,758 30,320 

Changes to Base:

Maintaining Current Levels (MCLs): $218,097

Pay Annualization (4.6% average pay raise) 47,398

Pay Raise (5.2% average pay raise) 162,696

Non-Pay 8,003

Technical Base Adjustments $43,258

FERS Law Enforcement Rate Increase 43,258

Subtotal Changes to Base $261,355

FY 2024 Current Services $4,783,113 30,320 

Program Increases:

 Restoration of Staffing Levels 114,380 415 

Subtotal FY 2024 Program Increases $114,380 415

FY 2024 President's Budget Request $4,897,493 30,735 

Dollars in Thousands
IRS-52 

2.1.4 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation 

Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding. 1 Historical data provided for comparison. 2 This measure was an indicator in FY 2022 and transitioned to a measure with a target starting in FY 2023.

3 Audits of high-income individuals may take a revenue agent upwards of 250 hours to complete. 4 Due to the timing of hiring and the start date of the lengthy training cycle, the impact of hiring from IRA funding on performance will not be realized until at 

least FY 2025 and the FY 2024 target is lower than FY 2023. 5 The impact of hiring on performance is not immediate due to required training for new Revenue Agents and the average case cycle time of about 36 months 

for these large corporations. Targets in FY 2024 are lower due to the training needs of new hires, case cycle time, and resources being applied to work High 

Income Individual and Partnership cases (more than 2,500 total in FY 2023 and 2,800 in FY 2024). 

 

2E – Regulatory 

($188,927,000 in direct appropriations and an estimated $525,000 from reimbursable programs): This 

budget activity funds the development of published IRS guidance materials; interpretation of tax laws; 

internal advice to IRS on general non-tax legal issues; enforcement of regulatory rules, laws, and 

approved business practices; and support for taxpayers in the areas of pre-filing agreements, 

determination letters, and advance pricing agreements. The activities include: 

• Tax Law Interpretation and Published Guidance interprets tax law through published guidance, 

technical advice, and other technical legal services. 

• General Legal Services provides advice to the IRS on non-tax legal issues, including procurement, 

personnel, labor relations, equal employment opportunity, fiscal law, tort claims and damages, 

ethics, and conflict of interest.

• Rulings and Agreements applies the tax law to specific taxpayers in the form of pre-filing 

agreements, determination letters, advance pricing agreements, and other pre-filing determinations 

and advice. 

• International Regulatory Legal Support supports Counsel’s work in tax law interpretation and 

rulings and agreements related to international issues. 

• Office of Professional Responsibility identifies, communicates, and enforces Treasury Circular 

230 standards of competence, integrity, and conduct of those who represent taxpayers before the 

IRS, including attorneys, Certified Public Accountants (CPAs), enrolled agents, enrolled actuaries 

and appraisers, and other professionals.

Dollars in thousands

Exam and Collections FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $3,875,098 $3,907,290 $3,933,597 $3,987,323 $4,447,716 $4,521,758 $4,897,493

Reimbursable Resources2 3,289 240 249 1,719 1,371 3,900 4,095

User Fees2 42 2,454

Budget Activity Total $3,878,387 $3,907,572 $3,936,300 $3,989,042 $4,449,087 $4,525,658 $4,901,588

Exam and Collections FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measures Actual Actual Actual Actual Actual Target Target Target

Exam Starts - High Income Individuals (new FY 2021)1,2,3 2,307 2,108 2,693 2,227 3,625 Indicator 3,817 4,830

Exam Starts - Partnerships (new FY 2021)1,2,4 9,033 5,823 4,106 4,327 3,155 Indicator 8,852 5,253

Exam Starts - Large Corporations (new FY 2021)1,2,5 2,396 2,009 1,700 1,490 1,365 Indicator 1,121 947

Examination Efficiency - Individual 131 109 76 108 101 100 92 80

Time to Start Compliance Resolution (new FY 2020)1 60.1% 60.9% 66.3% 66.0% 68.0% Indicator Indicator Indicator

Time to Resolve Compliance Issue After Filing (new FY 2020)1 494 469 491 484 404 Indicator Indicator Indicator

Repeat Non-Compliance Rate (new FY 2020)1 30.0% 31.4% 35.6% 30.7% 28.1% Indicator Indicator Indicator

Collection Coverage 41.6% 41.3% 34.9% 41.2% 38.3% 36.5% 33.4% 34.8%

Cost to Collect $100 $0.34 $0.33 $0.35 $0.33 $0.29 Indicator Indicator Indicator
IRS-53 

Description of FY 2022 Performance - Regulatory

This budget activity funds the development and printing of published IRS guidance materials, 

interpretation of tax laws, internal advice to the IRS on general non-tax legal issues, enforcement of 

regulatory rules, laws, and approved business practices, and support for taxpayers in the areas of pre-filing 

agreements, determination letters, including granting 501(c)(3) status and approving pension plans, and 

advance pricing agreements. 

In FY 2022, the IRS published 71 Priority Guidance Plan (PGP) projects and 67 ministerial rulings. 

Ministerial projects are publications that only involve matters such as applicable Federal interest rates and 

monthly bond factor amounts. Many items published in FY 2022 involved complex and novel issues. 

Four of the published items pertain to implementing the Infrastructure Investment and Jobs Act, including 

guidance on the retroactive termination of the employee retention credit and information about superfund 

chemicals. The first piece of guidance under the IRA of 2022 was published, providing guidance for 

making a claim for sale or use of alternative fuels. The 2022-2023 PGP was published on November 4, 

2022, and covers July 2022 through June 2023, listing 205 projects. 

In FY 2022, the IRS made 94,466 Exempt Organizations (EO) Determinations, 92,795 were for new 

organizations applying for exempt status. In FY 2021, IRS made 136,708 total determinations of which 

134,621 were for new organizations. In FY 2022, IRS closed 3,270 EO examinations, which is slightly 

more than the 3,249 closures in FY 2021. IRS completed 1,277 Employee Plan (EP) Determinations on 

pension plans in FY 2022, which was a 39 percent decrease from the 2,104 closures in FY 2021. In FY 

2022, IRS closed 3,944 EP examinations, which was a 9 percent decrease from the 4,295 closed in FY 

2021. 

The Office of Professional Responsibility (OPR) remains firmly committed to educating tax professionals 

about their responsibilities and limitations under Circular 230, and their ethical obligations to taxpayers 

and tax administration. 

During FY 2022, the OPR focused on multilingual assistance, increased digital services, and refined 

strategies to identify possible Circular 230 violations of significance going unidentified using technology 

tools and data analytics.

The OPR performed its outreach activities through presentations conducted in-person and virtually 

through online webinars including the IRS Nationwide Tax Forums, telephonically, and via video 

conferencing platforms throughout FY 2022. 

The annual IRS Nationwide Tax Forums have been held each summer for more than 30 years. The Tax 

Forum is the agency’s marquee event for providing important tax information to these valued partners and 

stakeholders. The 2022 Tax Forum was again held virtually, with a program stretching over five weeks in 

July and August. The program featured livestreamed webinars delivered by several partner organizations 

and IRS officials on subjects including tax law, professional ethics, virtual currency, collection issues, and 

many other topics. Some of the webinars were offered in both English and Spanish. The Nationwide Tax 

Forums are an integral part of OPR’s external outreach efforts, as thousands of tax professionals attend 

these forums. These outreach events helped ensure taxpayers received competent and ethical 

representation before the agency. 
IRS-54 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table. 

 

2.1.5 – Budget and Performance Report and Plan 

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation 

 Transfers.

2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

Regulatory

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $171,274 944 

Changes to Base:

Maintaining Current Levels (MCLs): $8,608

Pay Annualization (4.6% average pay raise) 1,926

Pay Raise (5.2% average pay raise) 6,605

Non-Pay 77

Subtotal Changes to Base $8,608

FY 2024 Current Services $179,882 944 

Program Increases:

 Restoration of Staffing Levels 9,045 81 

Subtotal FY 2024 Program Increases $9,045 81

FY 2024 President's Budget Request $188,927 1,025 

Dollars in Thousands

Dollars in thousands

Regulatory FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $170,222 $174,624 $157,374 $132,506 $215,030 $171,274 $188,927

Reimbursable Resources2 593 412 252 222 243 500 525

Budget Activity Total $170,815 $175,036 $157,626 $132,728 $215,273 $171,774 $189,452
IRS-55 

Operations Support

Appropriation Description 

The Operations Support appropriation as currently defined funds rent payments; facilities services; 

printing; postage; physical security; headquarters policy and management activities; research and statistics 

of income; and necessary expenses for information systems and telecommunication support, including 

development, security, and maintenance of the IRS’s information systems. 

The Operations Support budget request for FY 2024 is $4,520,476,000 in direct appropriations and 

11.506 FTE. This is an increase of $419,250,000 or 10.22 percent, and 100 FTE more than the FY 2023 

Enacted Budget level of $4,100,826,000 and 11,406 FTE. 

2.1 – Budget Adjustments Table

See footnotes in 1.1 - Appropriations Detail Table. 

Operations Support

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $4,100,826 11,406 

Changes to Base:

Maintaining Current Levels (MCLs): $142,647

Pay Annualization (4.6% average pay raise) 22,086

Pay Raise (5.2% average pay raise) 76,955

Non-Pay 43,606

Subtotal Changes to Base $142,647

FY 2024 Current Services $4,243,473 11,406 

Program Increases:

Strategies for Improving the Taxpayer Experience 32,381 19

Green Tax Credit Implementation 30,398

Improve Telephone Level of Service and Reduce 

Correspondence Inventory 73,433

Restoration of Staffing Levels 24,522 9

Fleet Electrification 3,029

Sustainment of Deployed IT Capabilities 55,878 43

Sustaining Infrastructure 27,500 26

Sustainable and Resilient Buildings 29,462 3

Subtotal FY 2024 Program Increases $276,603 100

FY 2024 President's Budget Request $4,520,076 11,506 

Dollars in Thousands
IRS-56 

2.2 – Object Classification Obligations

 Amounts reflect obligations of annually appropriated discretionary resources. 

 See footnotes in 1.1 - Appropriations Detail Table. 

Dollars in Thousands

O perations Support FY 2022 FY 2023 FY 2024

O bject Classification

O perating 

Plan

Estimated

O bligations

Request

11.1 - Full-time permanent 1,113,711 1,349,267 1,430,652

11.3 - Other than full-time permanent 5,914 7,181 7,547

11.5 - Other personnel compensation 31,767 39,887 42,176

11.8 - Special personal services payments 20 0 0

11.9 - Personnel Compensation (Total) 1,151,412 1,396,335 1,480,374

12.0 - Personnel benefits 413,076 524,157 555,231

13.0 - Benefits for former personnel 11 30 32

Total Personnel and Compensation Benefits $1,564,499 $1,920,522 $2,035,637

21.0 - Travel and transportation of persons 6,792 16,576 17,791

22.0 - Transportation of things 12,827 13,390 14,231

23.1 - Rental payments to GSA 584,918 607,157 625,993

23.2 - Rental payments to others 593 293 299

23.3 - Communications, utilities, and miscellaneous charges 289,054 281,202 303,879

24.0 - Printing and reproduction 57,513 25,316 27,017

25.1 - Advisory and assistance services 902,288 506,573 593,566

25.2 - Other services from non-Federal sources 24,505 31,954 39,502

25.3 - Other goods and services from Federal sources 76,610 85,844 89,383

25.4 - Operation and maintenance of facilities 195,717 192,702 208,401

25.6 - Medical care 17,500 14,758 16,058

25.7 - Operation and maintenance of equipment 55,378 63,606 68,794

26.0 - Supplies and materials 3,260 5,152 9,190

31.0 - Equipment 295,955 269,685 334,339

32.0 - Land and structures 60,184 65,382 135,268

42.0 - Insurance claims and indemnities 233 714 728

Total Non-Personnel $2,583,327 $2,180,304 $2,484,439

Total O bligations $4,147,826 $4,100,826 $4,520,076

Full-time Equivalents (FTE) 10,133 11,406 11,506
IRS-57 

2.3 – Appropriation Detail Table

See footnotes in 1.1 - Appropriations Detail Table. 

2F – Infrastructure 

($1,053,129,000 in direct appropriations and an estimated $1,050,000 from reimbursable programs): 

This budget activity funds administrative services related to space and housing, rent and space alterations, 

building services, maintenance, guard services, and non-IT equipment. The program activities include: 

• Building Delegation oversees and manages the IRS GSA-delegated buildings, including cleaning, 

maintenance, utilities, protection, administrative, and recurring and one-time repair costs. 

• Rent provides resources for all IRS rent needs. 

• Space and Housing/Non-IT Equipment provides management of all IRS building services, 

maintenance, space alterations, guard services, custodial overtime, utility service needs, and nonIT equipment. 

• Security covers all physical security costs including guard services, security equipment and 

maintenance, countermeasures, Homeland Security Presidential Directive 12 (HSPD-12) and 

Treasury Enterprise Identity Credential and Access Management (TEICAM). 

Dollars in Thousands

O perations Support

Appropriated Resources

New Appropriated Resources FTE AMO UNT FTE AMO UNT FTE AMO UNT FTE AMO UNT

Infrastructure 925,539 922,682 1,053,129 14.1%

Shared Services and Support 5,233 1,179,189 5,097 1,164,430 5,113 1,232,149 0.3% 5.8%

Information Services 4,900 2,043,098 6,309 2,013,714 6,393 2,234,798 1.3% 11.0%

Subtotal New Appropriated Resources 10,133 $4,147,826 11,406 $4,100,826 11,506 $4,520,076 0.9% 10.2%

O ther Resources

Reimbursable 73 56,033 100 77,000 105 80,850 5.0% 5.0%

Offsetting Collections (Non-reimbursable)

User Fees 14 329,128 15 27,927 -100.0% -100.0%

Recoveries from Prior Years 20,839 36,074 36,074 0.0%

Unobligated Balances from Prior Years 1,817 695,383 41 336,667 9,000 -100.0% -97.3%

IRA Funding Usage 60,965 727 1,017,758 3,810 2,380,097 424.1% 133.9%

Transfers In/Out

Resources from Other Accounts 3 20,508 34 39,361 34 39,361 0.0% 0.0%

Subtotal O ther Resources 1,907 $1,182,856 917 $1,534,787 3,949 $2,545,382 330.6% 65.8%

Total Budgetary Resources 12,040 $5,330,682 12,323 $5,635,613 15,455 $7,065,458 25.4% 25.4%

FY 2022 FY 2023 FY 2024 FY 2023 to FY 2024

O perating Plan Enacted Request % Change
IRS-58 

Description of FY 2022 Performance - Infrastructure

Rent 

Rentable Square Feet per Person is the amount of rentable square feet the IRS maintains per person 

requiring space. After payroll, rent is one of the IRS’s largest operating expenses; therefore, the IRS 

continues to take steps to closely monitor and right-size its total office space. 

Through FY 2022, the Rentable Square Feet per Person was 264, which is five percent lower than the 

prior year of 278. Rentable Square Feet per Person is driven in the positive direction by either a decrease 

in square footage, increase in staffing or a combination of both. In FY 2022, there was a 1.5 percent 

increase in personnel requiring space and a 3.9 percent decrease in rentable square footage. 

The submission processing consolidation resulted in the release of the Fresno, California center in 

FY 2022. Additionally, IRS closed three posts of duty (buildings in Washington, D.C., Danville, VA, and 

Redding, CA). The IRS continues to release excess office space through building closures and 

consolidations and continues to look to incorporate new hires into existing space where possible. The IRS 

will set its FY 2023 target to 261 square feet and the FY 2024 target to 258 square feet.

Security and Safety 

Security of IRS facilities and providing a secure and safe environment for employees are of utmost 

importance to the IRS. 

In FY 2022, IRS maintained a high-level emphasis on the physical security of its facilities, taxpayers’

information, employees, and visitors. This was accomplished through various actions. Noteworthy 

examples included: 

• Increased management and oversight of physical security countermeasures by leveraging 

technology and incorporating new tools that allow the IRS to better manage security postures at 

facilities. Physical security countermeasures are deployed based on requirements and 

recommendations set forth by the Department of Homeland Security and the Interagency Security 

Committee (ISC).

• Initiated an Out-Of-Cycle Security Review of most IRS facilities. This focused on enhancing 

security equipment and accessing control systems, intrusion detection systems, and video 

surveillance systems. 

• Delivered enhanced security training sessions to all IRS employees virtually and in-person and 

continued to issue systematic and consistent communications surrounding security procedures, 

protocols, and safety tips.

• Completed the Federal Protective Service-led Physical Security Training Program for IRS 

Physical Security Specialists, adhering to ISC guidance (on-going). 
IRS-59 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table

Infrastructure

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $922,682

Changes to Base:

Maintaining Current Levels (MCLs): $18,467

Pay Annualization (4.6% average pay raise) 6

Pay Raise (5.2% average pay raise) 16

Non-Pay 18,445

Subtotal Changes to Base $18,467

FY 2024 Current Services $941,149

Program Increases:

 Strategies for Improving the Taxpayer Experience 4,159

 Green Tax Credit Implementation 20,460

 Improve Telephone Level of Service and Reduce

 Correspondence Inventory 40,907

 Restoration of Staffing Levels 15,392

 Fleet Electrification 74

 Sustainment of Deployed IT Capabilities 1,273

 Sustaining Infrastructure 770

 Sustainable and Resilient Buildings 28,945

Subtotal FY 2024 Program Increases $111,980

FY 2024 President's Budget Request $1,053,129

Dollars in Thousands
IRS-60 

2.1.6 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees. 

 

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding.

2G – Shared Services and Support 

($1,232,149,000 in direct appropriations, and an estimated $36,750,000 from reimbursable programs): 

This budget activity funds policy management, IRS-wide support for research, strategic planning, 

communications and liaison, finance, human resources, and equity, diversity, and inclusion programs. It 

also funds printing and postage, business systems planning, security, legal services, and procurement. The 

program activities include: 

• National Headquarters Management and Administration directs the management activities of 

strategic planning, communications and liaison, finance, human resources, equity, diversity and 

inclusion programs, business systems planning, embedded training, and the Treasury Franchise 

Fund. It sets policies and goals, provides leadership and direction for the IRS, and builds partner 

relationships with key stakeholders (Congress, U.S. Government Accountability Office, and the 

Office of Management and Budget (OMB)). It provides policy guidance for conducting planning 

and budgeting strategies, conducting analyses of programs and investments to support strategic 

decision-making, and developing and managing human resources. It also includes official 

reception and representation expenses.

• Facilities Management and Security Services provides facilities and security services to deliver a 

safe, secure, and optimal work environment for IRS employees. Facilities Management and 

Security Services: provides facilities and security services to deliver a safe, secure, and optimal 

work environment for IRS employees. 

• Equity, Diversity, and Inclusion Field Services provides staffing, training, and direct support to 

plan and manage the IRS’s Equity, Diversity, and Inclusion program. 

• Communications and Liaison: coordinates local government and liaison relationships; handles 

congressional, state, and national stakeholder relationships and issues; coordinates cross-cutting 

issues, including managing audits and legislative implementation; handles national media 

contacts and local media relationships; and ensures IRS-wide compliance with disclosure and 

privacy laws. 

• Shared Support not provided by Facilities Management and Security Services, which includes

resources for shared cross-functional support like copiers, postage meters, shredders, courier 

services, and post office boxes. 

Dollars in thousands

Infrastructure FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $870,360 $891,140 $867,354 $885,606 $925,539 $922,682 $1,053,129

Reimbursable Resources2 662 681 747 854 564 1,000 1,050

User Fees2 999

Budget Activity Total $871,022 $892,820 $868,101 $886,460 $926,103 $923,682 $1,054,179

Infrastructure FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measure Actual Actual Actual Actual Actual Target Target Target

Rentable Square Feet per Person 301 298 278 278 264 270 261 258
IRS-61 

• Printing and Postage – Media and Publications: provides operating divisions with printing and 

postage, including shipping of taxpayer and internal-use materials. 

• Statistics of Income: provides resources for researching annual income, financial and tax data 

from tax returns filed by individuals, corporations, and tax-exempt organizations. 

• Protection of Sensitive Information: manages and oversees the staffing, training, equipment, and 

direct support for the protection of IRS employees, facilities, assets, and the protection and 

proper use of identity information. 

• Benefit Payments: provides resources to fund Workers’ Compensation benefits and 

Unemployment Compensation for federal employee payments. 

• Shared Services: provides additional services, including the Public Transit Subsidy. 

Description of FY 2022 Performance – Shared Services and Support

Through support activities that include management and administration of human resources, protection 

and use of identity information, and research, Operations Support continues to provide shared services to 

all IRS programs.

Human Capital 

The future of the IRS depends on a workplace culture that empowers employees to improve the taxpayer 

experience and uphold the tax code fairly. In FY 2022, the IRS obtained direct hire authority (DHA)

through the Office of Personnel Management (OPM) and the Consolidated Appropriations Act, 2022, to 

reach a broader applicant pool and reduce the number of days to hire. These authorities were used to hire 

personnel such as Tax Examiners, Clerks, Customer Service Representatives, and critical operations 

support positions. The OPM DHA allows for 10,000 new hires through December 2023 and is limited to 

the Submission Processing and Accounts Management functions in Wage and Investment. Treasury 

delegated the IRS additional direct hiring authority under the Consolidated Appropriations Act, 2023, for 

unlimited hires in support of the backlog reduction through September 30, 2023. 

Protection and Proper use of Identity Information 

IRS delivered the Data At Rest Encryption effort aimed to eliminate or reduce critical security 

vulnerabilities, improving the depth of IRS's cyber defenses by protecting stored taxpayer data in the 

event of an unauthorized access. Completed encryption for multiple payment systems including 

Electronic Federal Posting Payment System and Tax Account Processing System. 

The Security Summit, a public-private sector partnership between the IRS, state revenue departments, 

software developers, tax professionals, and financial services groups, is now in its sixth year of 

establishing repetitive iterative processes that support taxpayer security initiatives. The annual Security 

Summit Co-Leads meeting between the IRS, Industry, and States was held virtually in June 2022. As a 

result of the Security Summit workgroup efforts, the IRS is preventing more identity theft than previous 

years and leads related to identity theft continue to increase. The Security Summit continues to protect 

taxpayers by combating ID theft tax refund fraud through enhanced communication and information 

sharing between and among the parties involved in the electronic transmission and processing of federal 

and state income tax return filings.
IRS-62

Research 

The IRS invests in Service-wide research projects to help its leaders make data and evidence-driven 

improvements to IRS operations and taxpayer services. 

In FY 2022, the IRS: 

• Integrated numerous data and analytics capabilities in support of initiatives to enhance 

delivery of the IRS mission and improve the customer experience by helping taxpayers identify 

and resolve issues timely and accurately.

• Began an enterprise initiative developing a comprehensive Data Strategy providing the IRS 

with a framework to assess, prioritize, and address data access and analytics needs across the IRS 

and to guide critical program and policy decisions.

• Expanded access to data and use of advanced data analytics to support IRS compliance 

programs and front-line employees. In FY 2022, more than 3,000 front line compliance employees 

accessed a network analytics tool 100,000 times to get a more complete picture of the taxpayer’s 

situation leading to quicker identification and resolution of compliance issues. Research provided 

top-down network analysis to identify and inform a range of emerging compliance issues 

including labor broker schemes, paycheck protection loan fraud and syndicated conservation 

easements.

• Shared results and lessons learned from its Innovation Lab program. The IRS Innovation Lab 

concept encourages new approaches and solutions to prevalent compliance issues, bringing 

together employees with varied specialties to work collaboratively to support the IRS mission in a 

unified way across the traditional organizational boundaries. As a result of insights drawn from 

innovation lab initiatives, the IRS has been able to increase collaboration across business units in 

identifying and selecting high risk, noncompliant cases among tax professionals, as well as 

developing a better understanding of behavioral attributes associated with taxpayers involved in 

digital assets transactions.

• Established a new “Digital Workforce,” automating thousands of requests and conversations 

without the need for human intervention. The IRS is now able to provide real-time assistance in 

English or Spanish to taxpayers via some communication channel through chatbots. When 

interacting with a chatbot, customers can request “live chat” with an agent. This self-service 

technology will improve the taxpayer experience and free IRS assistors to focus on more complex 

inquiries during a period of unprecedented demand.

• Implemented enhancements to IRS Online Accounts offering taxpayers with an online account 

experience that is reliable, robust, and integrates module information through a collection of 

digital products/services and empowers taxpayers to ‘self-serve’ in securely managing and 

fulfilling their federal tax obligations.

• Continued momentum with its digitalization strategy. The strategy allows flexibility within 

inventory management, electronic workflows, and business continuity. Benefits include new 

digital channel options that enhance the portability of work and leverage resources across the 

Service. Additionally, the strategy allows for seamless access to taxpayer imaged cases without 
IRS-63 

additional burdens on the taxpayer to provide documents. This transparency reduces risk for both 

taxpayers and the IRS. 

• Increased data-literacy opportunities to support data analysis training needs of staff by 

developing a preliminary set of learning paths to guide course selection in our internal training 

environment and launched an analytical primer curriculum to help employees understand the 

science of analytics. Consequently, it improves their collective ability to conduct, evaluate, and 

communicate data-driven decisions. 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table

Shared Services and Support

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $1,164,430 5,097 

Changes to Base:

Maintaining Current Levels (MCLs): $47,060

Pay Annualization (4.6% average pay raise) 8,833

Pay Raise (5.2% average pay raise) 30,301

Non-Pay 7,926

Subtotal Changes to Base $47,060

FY 2024 Current Services $1,211,490 5,097 

Program Increases:

 Strategies for Improving the Taxpayer Experience 3,826 5 

 Green Tax Credit Implementation 1,928

 Improve Telephone Level of Service and Reduce

 Correspondence Inventory 3,593

 Restoration of Staffing Levels 7,745 8 

 Fleet Electrification 2,926

 Sustainment of Deployed IT Capabilities 103

 Sustaining Infrastructure 62

 Sustainable and Resilient Buildings 476 3 

Subtotal FY 2024 Program Increases $20,659 16 

FY 2024 President's Budget Request $1,232,149 5,113 

Dollars in Thousands
IRS-64 

2.1.7 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

2H – Information Services 

($2,234,798,000 in direct appropriations, $43,050,000 in reimbursable resources, and $0 from user fees): 

This budget activity funds staffing, equipment, and related costs to manage, maintain, and operate the 

information systems critical to the support of tax administration programs. This includes the design and 

operation of security controls and disaster recovery planning. This budget activity funds the development 

and maintenance of the millions of lines of programming code that support all aspects and phases of tax 

processing and the operation and administration of mainframes, servers, personal computers, networks, 

and a variety of management information systems. The program activities include: 

• Enterprise Program Management Office provides oversight and project integration into daily IT 

processes for large-scale development, modernization, and enhancement projects. It enables a 

coordinated, cross-functional project planning, implementation and performance assessment effort 

aimed at improving IT systems quality, cost, and delivery schedule. 

• Cybersecurity protects Taxpayer information and the IRS’s electronic systems, services, and data 

from internal and external cyber security related threats. The program operates a 24x7x365 

Computer Security Incident Response Center to provide detection, prevention, monitoring, 

analysis, and reporting of security incidents and threats. The program reduces online fraud and 

prevents critical data loss. It is responsible for performing security risk assessments, tracking 

compliance, monitoring security risk remediation activities, performing comprehensive security 

control testing, managing the system certification and accreditation process, and coordinating the 

enterprise continuous monitoring process. The program also provides security policy management 

and interpretation, delivers security engineering services, and implements cybersecurity and data 

protection solutions. 

• IT Executive Oversight provides support to the immediate Office of the Chief Technology Officer, 

as well as the direct reports for Equity, Diversity and Inclusion, and the Director, Stakeholder 

Management (including Communications Services and Program Oversight). The program 

provides executive direction for the IT organization, enabling IT to be a customer-focused supplier 

of IT solutions that are responsive to customer business priorities and meet functional and 

operational needs effectively. 

• Applications Development performs the analysis, design, development, testing, and 

implementation of approximately 85,000 application programs supporting critical tax processing, 

management information reporting and financial management support systems for the IRS. This 

program also supports external trading partner data exchanges with federal government agencies, 

state and local governments, and other third-party entities. The program controls application 

source code and deploys applications to the production environment. 

Dollars in thousands

Shared Services and Support FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $920,283 $900,287 $961,999 $1,040,955 $1,179,189 $1,164,430 $1,232,149

Reimbursable Resources2 27,995 30,360 27,368 27,874 28,433 35,000 36,750

User Fees2 1,000 37,454

Budget Activity Total $949,278 $930,647 $989,367 $1,068,829 $1,245,076 $1,199,430 $1,268,899
IRS-65

• Enterprise Operations designs, develops, and maintains IT that supports critical tax processing, 

management information reporting and financial management support systems for the IRS. The 

program supports data exchanges with external organizations, such as other federal agencies, state 

and local governments, and external entities (e.g., employers and banks), and includes a 

comprehensive disaster recovery capability to ensure continued operations in the event of a major 

interruption of service. 

• Enterprise Network provides telecommunications service delivery to all customer segments, 

including management of day-to-day operations of the telecommunications environment. This 

includes the operation of equipment and services to meet business user needs and the execution of 

routine changes for scheduled and unscheduled modifications to the telecommunications 

infrastructure and applications. It addresses all phases of engineering, acquisition, implementation, 

and operation of telecommunications systems and services, including voice, video, and data 

communications. 

• Enterprise Services plans and manages service and delivery methods used across the IT 

organization, including demand analysis, enterprise architecture, configuration management, 

project reporting, enterprise life cycle management, release management, systems engineering, 

dashboard reporting, and internal management. 

• End User and Network Services maintains the IRS automated business processes at headquarters 

and field sites, allowing the IRS to fulfill its missions effectively. The support includes technical 

systems and applications software support to end users and maintaining legacy operations, local 

and corporate systems administration activities, email, and domain user account maintenance. This 

activity monitors IRS network and systems administration by utilizing automated management 

tools. It performs asset management activities, and maintenance of the voice and data 

infrastructure at the Territories’ offices. 

• Strategy and Planning provides the management and oversight of investments in IT, demand 

analysis, project reporting, portfolio management, and other IT operational priorities. 

• Enterprise Infrastructure Currency funds the replacement of IRS IT infrastructure that has reached 

or surpassed its useful life cycle. The IRS centralizes the resources achieved through efficiencies 

in various parts of IT to ensure that replacement of the aging infrastructure is addressed 

corporately.

• The Treasury Franchise Fund is a centralized functional area for separating from the Information 

Services base budget the resources required to pay Treasury billings for services provided through 

the Working Capital Fund.
IRS-66 

Description of FY 2022 Performance – Information Services 

In FY 2022, the IRS made progress on many of its strategic technology goals. The following highlights 

achievements in IT operations and maintenance from FY 2022: 

• Tax Filing Season and Legislation: Executed on the technology development, engineering, 

security, and testing needed for the 2022 tax filing season, resulting in the payment of more than 

78 million refunds totaling more than $242 billion and more than $115.7 billion in modified tax 

credits as part of ARPA. In FY 2022, we continued ARP implementation, which included making 

advance payments of the Child Tax Credit. 

• Enterprise Digitalization: Documentation Upload Tool is a digital solution designed to accept 

images of paper documents (e.g., forms) submitted electronically and was expanded to address 

additional business needs. The new IRS Lockbox Network scans incoming Form 940 paper 

returns and electronically files the tax return data.

• Automated Digital Fingerprint Service: Created an automated digital fingerprint service used by 

tax professionals for background checks, saving time and improving the user experience compared 

to the manual paper process.

• Enhancing Fraud Detection: Enabled authorized IRS staff to perform custom ad hoc queries for 

case research, helping ensure tax compliance while also reducing time spent on research and 

auditing. Since 2017, Return Review Program has detected almost $22.8 billion of pre-refund 

fraud. 

The Percent of Aged Hardware is a measure that shows the quantity of IT hardware in operation past its 

useful life as a percentage of total hardware in use. The IRS continued to reduce the percentage of aged 

hardware from 9.3 percent at the end of FY 2021 to 7.1 percent at the end of FY 2022. This represents a 

reduction of more than 2,500 aged assets while total hardware increased slightly during the fiscal year. 

The major driver in exceeding this goal was the focus on hardware selections and timely hardware refresh 

implementations. For FY 2023, the IRS will continue with standard operations and review options for 

process improvements. For FY 2023 and FY 2024, the IRS will maintain the target at 20 percent. The 

industry standard for aged hardware is in the range of 20-25 percent. 

45.5%

31.0%

16.0%

9.3% 7.1%

0

50000

100000

150000

2018 2019 2020 2021 2022

Percent of Aged Infrastructure

Amount of Aged Infrastructure Total Infrastructure
IRS-67 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table. 

Information Services

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted $2,013,714 6,309 

Changes to Base:

Maintaining Current Levels (MCLs): $77,119

Pay Annualization (4.6% average pay raise) 13,248

Pay Raise (5.2% average pay raise) 46,637

Non-Pay 17,234

Subtotal Changes to Base $77,119

FY 2024 Current Services $2,090,833 6,309 

Program Increases:

 Strategies for Improving the Taxpayer Experience 24,397 15 

 Green Tax Credit Implementation 8,010

 Improve Telephone Level of Service and Reduce

 Correspondence Inventory 28,933

 Restoration of Staffing Levels 1,385

 Fleet Electrification 29

 Sustainment of Deployed IT Capabilities 54,502 43 

 Sustaining Infrastructure 26,668 26 

 Sustainable and Resilient Buildings 41

Subtotal FY 2024 Program Increases $143,965 84 

FY 2024 President's Budget Request $2,234,798 6,393 

Dollars in Thousands
IRS-68 

2.1.8 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation Transfers. 2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding. 1 Target based on industry standard. 

Business Systems Modernization

Appropriation Description 

The Business Systems Modernization (BSM) appropriation provides resources for the planning and 

capital asset acquisition of IT to modernize the IRS business systems. Sustained discretionary 

appropriations for BSM are critical to ensuring the long-term vision that will be outlined in the 

forthcoming IRA SOP. 

The BSM budget request for FY 2024 is $289,619,000 in direct appropriations and 197 FTE. This account 

did not receive funding in the FY 2023 appropriations bill. Sustained discretionary appropriations for 

BSM are critical to ensuring the long-term vision that will be outlined in the forthcoming IRA SOP. 

2.1 – Budget Adjustments Table

See footnotes in 1.1 - Appropriations Detail Table 

Information Services FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $2,390,357 $2,126,973 $1,972,916 $2,061,216 $2,043,098 $2,013,714 $2,234,798

Reimbursable Resources2 40,600 27,153 36,456 26,344 27,036 41,000 43,050

User Fees2 204,032 222,399 374,671 408,054 291,706 27,927

Budget Activity Total $2,634,989 $2,376,525 $2,384,043 $2,495,614 $2,361,840 $2,082,641 $2,277,848

Information Services FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measures Actual Actual Actual Actual Actual Target Target Target

Percent of Aged Hardware1 45.5% 31.0% 16.0% 9.3% 7.1% 20.0% 20.0% 20.0%

Business Systems Modernization

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted

Changes to Base:

Subtotal Changes to Base

FY 2024 Current Services

Program Increases:

 Business Systems Modernization 289,619 197 

Subtotal FY 2024 Program Increases $289,619 197

FY 2024 President's Budget Request $289,619 197 

Dollars in Thousands
IRS-69 

2.2 – Object Classification Obligations

Amounts reflect obligations of annually appropriated discretionary resources.

See footnotes in 1.1 - Appropriations Detail Table

2.3 – Appropriation Detail Table

 See footnotes in 1.1 - Appropriations Detail Table 

Dollars in Thousands

Business Systems Modernization FY 2022 FY 2023 FY 2024

O bject Classification

O perating 

Plan

Estimated

O bligations

Request

11.1 - Full-time permanent 40,377 29,844

11.3 - Other than full-time permanent 186 79

11.5 - Other personnel compensation 2,052 618

11.9 - Personnel Compensation (Total) 42,615 30,542

12.0 - Personnel benefits 14,567 10,732

Total Personnel and Compensation Benefits $57,182 $41,275

21.0 - Travel and transportation of persons 303 29

25.1 - Advisory and assistance services 207,561 244,620

25.7 - Operation and maintenance of equipment 68

26.0 - Supplies and materials 5 7

31.0 - Equipment 9,881 3,689

Total Non-Personnel $217,818 $248,344

Total O bligations $275,000 $289,619

Full-time Equivalents (FTE) 267 197

Dollars in Thousands

Business Systems Modernization

Appropriated Resources

New Appropriated Resources FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

Business Systems Modernization 267 275,000 197 289,619

Subtotal New Appropriated Resources 267 $275,000 197 $289,619

Other Resources

Recoveries from Prior Years 509 5,929 5,929 0.0%

Unobligated Balances from Prior Years 23 141,433 160,230 -100.0%

IRA Funding Usage 43,924 357 580,000 197 1,034,000 -44.8% 78.3%

Subtotal Other Resources 23 $185,866 357 $746,159 197 $1,039,929 -44.8% 39.4%

Total Budgetary Resources 290 $460,866 357 $746,159 394 $1,329,548 10.4% 78.2%

FY 2022 FY 2023 FY 2024 FY 2023 to FY 2024

Operating Plan Enacted Request % Change
IRS-70

2I – Business Systems Modernization

($289,619,000 in direct appropriations): This budget activity funds the planning and capital asset 

acquisition of information technology to modernize IRS business systems and processes, including labor 

and related contractual costs, in support of the IRS mission. 

The IRS is developing its multiyear plan using the direct appropriation in conjunction with IRA funding 

to transform tax administration and taxpayer service. With this funding, the IRS is committed to

transforming into a more customer-focused agency that strives to help taxpayers get it right the first time 

and quickly resolve issues. By significantly improving services, tailoring compliance work, and ensuring 

IRS employees have the data and tools they need, the IRS will address the tax gap over time.

To dramatically improve the taxpayer experience, the IRS must accelerate delivery of modern technology 

capabilities at a pace and scale that has never been done before. IRS must also build a contemporary 

infrastructure with modern architectures designed to meet future needs and retire legacy technologies. 

This modernization will make the IRS more efficient and improve the customer experience to benefit 

taxpayers, tax professionals, and the broader tax ecosystem, while protecting taxpayer data and securing 

our systems from cyber threats. 

Funding in FY 2024 will provide the necessary resources for the IRS to continue the progress in existing 

work and begin new programs to enhance the taxpayer experience and enforcement activities. BSM 

funds are strictly used for development, modernization, and enhancement activities, and do not fund 

operations and maintenance once a project is developed. The IRS will need funds to accelerate its 

technology transformation.

In the upcoming years, the IRS will modernize its information technology to enhance the taxpayer 

experience which will improve communications with individual taxpayers, business taxpayers, and third 

parties. The enhancements, delivered over time, will provide a broad range of self-service options, and 

establish a secure information exchange that enables authorized third parties and taxpayers to interact 

digitally with the IRS. Taxpayers, both individual and business, will have access to secure online accounts 

where they can view their account and profile information, make changes, interact with the IRS, and 

manage preferences for payments, refunds, and communications. By enabling taxpayers to access data 

directly, taxpayers will be able to download and seamlessly share their tax data and IRS history. For 

example, the IRS will make individual and business transcripts easier to read and understand and will 

integrate these key tax records with secure online accounts. 

Over time, payment systems will be modernized so taxpayers will be able to use their preferred option to 

make payments easily and seamlessly through various service channels to the IRS. IRS will expand 

features in online accounts, where individuals, businesses, tax professionals, and payroll processers will 

be able to make, manage, and view payments. Options will be improved and expanded for online 

payments without registration and will enable payments over the phone, through IRS employees, and 

from international taxpayers and governments. In FY 2024, the IRS is targeting additional enhancements 

to improve Direct Pay, business payments, and payments over the phone or through IRS field employees

to achieve this goal. 

This digitalization effort will allow more transparent tracking tools that give taxpayers personalized, realtime status updates and explanations of next steps. The tracking will also allow tax professionals to view 

status information for their clients. These tools will help taxpayers understand what to expect, identify the 

cause of delays or issues, get answers via self-service, and understand what actions they need to take. In 

FY 2024, the IRS will implement the highest priority end-to-end digital processes by starting delivery on 

the high-priority forms, returns, and certifications available for electronic filing and digitalization to reach 
IRS-71 

these goals. In addition, with both sources of discretionary and mandatory funding IRS will enable 

improved taxpayer tracking tools for individual taxpayers for filing season 2025. 

The IRS will implement modernized technologies to improve customer support and response time in the 

call centers. Taxpayers can already request customer callback, conduct live and automated chats, and 

utilize natural language processing on our highest priority services, which will help avoid long wait times, 

especially during the filing season. We will continue to streamline multichannel customer assistance to 

enable taxpayers to get the help they need quickly and securely, resolve more issues in a single contact, 

and experience minimal delays during customer service interactions. The result of these services will 

optimize the user experience and deliver consistent and secure information regardless of the channel used 

to contact the IRS.

The IRS will ensure a fair and equitable system for all taxpayers by increasing compliance activities for 

high income taxpayers who pose a high risk of non-compliance. The IRS is accelerating the 

implementation of a single, modernized Enterprise Case Management system with access to taxpayer data 

and standard business processes that will result in efficient and transparent case processing for taxpayers. 

This centralization of operations will improve enforcement through better use of data analytics and 

technology. In FY 2024, the IRS will continue to build functionality for the Exam function as IRS 

expands its compliance workforce. This will set the stage for the modernized Enterprise Case 

Management (ECM) platform to host most major compliance workflows and begin the decommissioning 

of associated legacy applications starting in FY 2025. The result of this long-term implementation will 

transform tax compliance processes, resulting in an enterprise solution for streamlining case and workload 

management processes to improve the quality and effectiveness of case interactions with taxpayers and a 

wide spectrum of stakeholders. IRS will digitize case information, provide business automation, and 

increase resource alignment to improve enforcement and reduce the timeframe for case resolution. 

The IRS will use funding in FY 2024 to continue modernizing its complex technological environment and 

accelerate delivery of modern technology to enable a service experience comparable to private industry. 

The IRS will accelerate design, development, and delivery of user-centered technology by shifting to a 

“product and platform” operating model that incorporates business and technology perspectives to deliver 

faster and better results. In FY 2024, as the IRS continues to migrate to cloud infrastructure and 

standardizing cloud connectivity, this will allow implementation of new tax provisions and future 

modernization to be implemented faster and securely, while complying with Federal mandates. In 

FY 2024, IRS will implement an advanced analytics platform to provide tools for service, compliance, 

and operational use to support expanded capability delivery for taxpayers and employees.

A portion of the FY 2024 funding will provide system engineering management capabilities, including 

systems strategy, architecture, and engineering capabilities. To improve operational efficiencies, IRS will 

continue to leverage and expand robotics process automation. These activities are critical components of 

the IRS plan to transform operations and become more resilient, agile, and responsive, thereby improving 

the taxpayer experience, and narrowing the tax gap. 

In FY 2024, IRS will ramp-up key programs that will modernize the systems for accessing and processing 

taxpayer data by focusing on master file and the downstream tax processing pipeline systems. The 

Individual Master File (IMF) and Business Master File (BMF) modernization will help IRS achieve the 

goal to modernize the legacy components and securely distribute taxpayer data across the enterprise, 

while enabling the retirement of the legacy code and data formats. IRS will launch another key program in 

FY 2024, called Real-Time Tax Processing, this will help achieve the long-term goal to modernize from 

batch processing to near real time processing, providing taxpayers the ability to correct tax filing almost 

instantly. 
IRS-72 

These technological advancements cannot be achieved without continued focus on data security. The IRS 

will ensure continued protection of taxpayer data and IRS systems from external cyber threats as we 

transform and achieve objectives in the taxpayer service and enforcement areas. The IRS will also

continue implementing industry and federal best practices in cybersecurity (e.g., network security, identity 

and access management, vulnerability and threat management, and Zero Trust architecture) to protect IRS 

data from all cyber-threats. As part of this effort, in FY 2024 the IRS will continue to implement 

capabilities for continuous identification of all assets and users on the IRS network. In addition, 

multi-factor authentication will be implemented to improve access controls to IRS systems containing 

federal tax information. Data-at-rest encryption will also be implemented for the full portfolio of IRS 

critical systems to strengthen data protections and prevent unauthorized access to sensitive data entrusted 

by the IRS. Through this transformation, IT programs and internal processes will be highly integrated, 

streamlined, flexible, and secure. This will enable the IRS to provide top-quality service, retire and 

replace legacy systems with more sustainable infrastructure, and continue to protect taxpayer data and 

address emerging security threats.

Description of FY 2022 Performance – Business Systems Modernization

The IRS’s modernization efforts focus on building and deploying advanced information technology 

systems, processes, and tools to improve efficiency and productivity. 

In FY 2022, the IRS tracked progress toward its strategic technology goals through the process of 

implementing the IRS Integrated Modernization Business Plan and other reporting. During FY 2022, 59 

modernization capabilities were delivered across all four components of the plan: improving the taxpayer 

experience, core services and enforcement, modernized IRS operations, and cybersecurity and data 

protection. The following highlights achievements in business systems modernization from FY 2022: 

• Vulnerability and Threat Management: Protected the integrity of the nation’s tax system by 

mitigating more than 1.4 billion unauthorized access attempts in FY 2022 using layered controls 

and a robust incident response capability that performs around-the-clock intrusion and fraud 

analytics.

• 24x7 Access to Online Tools: Added new features and made other foundational technology 

upgrades for popular online tools such as IRS Online Account4 and Tax Pro Account5.

• Intelligent Digital Assistors: Expanded voice and chatbot options to help eligible taxpayers 

easily verify their identity to set up or modify a payment plan, or make other types of inquiries, 

while avoiding long wait times. 

• Multilingual Efforts: With advanced technologies in translation services and continued agile 

development practices, upgraded five taxpayer-facing applications to offer multilingual 

capabilities in Spanish. Four of these applications were also translated into six additional 

languages, providing our diverse tax community with the information to meet their tax obligations. 

• Customer Callback: Strengthened IRS customer service phone operations, which is one of the 

largest in the world. IRS had to manage unprecedented demand by expanding customer callback 

availability to 31 toll-free telephone applications, accounting for approximately 70 percent of 

demand. Since its launch in January 2019, the IRS has offered over 18 million callbacks with an 

average acceptance rate of 58 percent, saving 6.1 million hours of hold time. 

• Legacy Code Conversion: Completed 100 percent of code conversion aimed to retire legacy code 

and reengineer the most complex aspects of the Individual Master File as part of the CADE 2 

4 https://www.irs.gov/newsroom/an-irs-online-account-is-simple-safe-and-secure 5 https://www.irs.gov/tax-professionals/use-tax-pro-account
IRS-73 

Transition State 2 program, which simplifies the IT environment and enables faster responses to 

new legislation. 

• Enterprise Case Management: After establishing the cloud-based platform and migrating legacy 

functions for four programs in FY 2021, the IRS integrated two more systems in FY 2022, 

allowing for more efficient case resolution. The IRS plans to migrate more than 200 business 

processes to using the platform, which will require training and transition activities for more than 

45,000 IRS employees. 

Major IT investments are measured by the proportion of projects within +/- 10 percent of budgeted cost 

and schedule variance. The IRS will continue to effectively manage our major IT investments and closely 

monitor cost and schedule variance throughout FY 2023 and FY 2024. The FY 2023 and FY 2024 targets 

for both cost and schedule variance are 90 percent. For more detail about BSM accomplishments and 

performance goals, please see Publication 54536

, Information Technology (IT) Annual Key Insights 

Report. 

Percent of Major IT Investments within +/- 10 percent Cost Variance at the Investment Level: 13 of 

16 major investments (81.3 percent) were within the cost variance threshold in FY 2022. 

Shown below are the investments that fell outside the +/- 10 percent Cost variance.

• Customer Account Data Engine (CADE 2) 

• Foreign Account Tax Compliance Act (FATCA) 

• Modernized IRS Operations 

Percent of Major IT Investments within +/- 10 percent Schedule Variance at the Investment 

Level: 14 of 16 major investments (87.5 percent) were within the schedule variance threshold at the close 

of FY 2022. 

Shown below are the investments that fell outside the +/- 10 percent schedule variance in FY 2022. 

• Foreign Account Tax Compliance Act (FATCA) 

• Modernized IRS Operations

6 https://www.irs.gov/pub/irs-pdf/p5453.pdf

Major IT (BSM and Non-BSM) Investments

Fiscal Year

Percent within +/- 10%

Cost Variance

Percent within +/- 10% 

Schedule Variance

2022 81.3% 87.5%
IRS-74 

FY 2024 Changes by Budget Activity

See footnotes in 1.1 - Appropriations Detail Table

2.1.9 – Budget and Performance Report and Plan

1 The FY 2018 - FY 2022 appropriated resources represent the approved operating plan including any inter-BAC transfers and Inter-Appropriation 

Transfers.

2 The FY 2018 - FY 2022 columns represent realized resources for reimbursables and user fees.

Note - FY 2023 and FY 2024 targets assume discretionary and IRA funding.

Business Systems Modernization

Summary of Proposed FY 2024 Request Amount FTE

FY 2023 Enacted

Changes to Base:

Subtotal Changes to Base

FY 2024 Current Services

Program Increases:

 Business Systems Modernization 289,619 197 

Subtotal FY 2024 Program Increases $289,619 197

FY 2024 President's Budget Request $289,619 197 

Dollars in Thousands

Dollars in thousands

Business Systems Modernization FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024

Resource Level Actual Actual Actual Actual Actual Enacted Request

Appropriated Resources1 $110,000 $150,000 $180,000 $203,614 $275,000 $289,619

User Fees 77,418 89,713 108,872 29,495

Budget Activity Total $187,418 $239,713 $288,872 $233,109 $275,000 $289,619

Business Systems Modernization FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2022 FY 2023 FY 2024

Measures Actual Actual Actual Actual Actual Target Target Target

72.2% 88.9% 84.2% 94.1% 81.3% 90.0% 90.0% 90.0%

83.3% 88.9% 94.7% 100.0% 87.5% 90.0% 90.0% 90.0%

Percent of Major IT Investments within +/- 10% 

Cost Variance at the Investment Level

Percent of Major IT Investments within +/- 10% 

Schedule Variance at the Investment Level
IRS-75 

B – Business Systems Modernization Pillar

Business Systems Modernization

Dollars in thousands

Funding

Category1

FY 2022 

Actuals

FY 2023 BSM 

Plan

FY 2024 

President's 

Budget Request 

Base Funding Level/Program Increase 229,239 0 289,619

Carryover Balance 18,709 50,300 0

Proposed Inter-appropriation Transfer 150,000

Total Discretionary $247,948 $200,300 $289,619

 FTE 270 185 197

Inflation Reduction Act - BSM

Taxpayer Services 10,936 285,000 255,000

Expand enforcement on complex taxpayers with high-dollar noncompliance to address the tax 1,046 75,000 157,000

Deliver cutting edge technology, data and analytics 31,941 220,000 623,000

Total Mandatory 2 $43,923 $580,000 $1,035,000

 FTE 0 357 197

Total BSM (Mandatory and Discretionary) $291,871 $780,300 $1,324,619

 Total FTE 270 542 394

Discretionary Breakout is as follows:

Web Applications* $38,207 $30,000 $130,000

Capital 26,958 20,075 113,969

Support 11 5 32

Labor 11,238 9,920 15,999

FTE 59 50 80

Live Assistance* $4,654 $1,100 $0

Capital 4,512 1,073 0

Support 4 3 0

Labor 138 24 0

FTE 1 0

Taxpayer Experience - Subtotal $42,861 $31,100 $130,000

FTE 60 50 80

Customer Account Data Engine (CADE 2)* $93,911 $39,200 $0

Capital 71,553 32,458 $0

Support 7 25 $0

Labor 22,351 6,717 $0

FTE 111 30 0

Enterprise Case Management* $65,048 $75,000 $150,019

Capital 47,779 56,453 126,460

Support 10 22 19

Labor 17,259 18,525 23,540

FTE 88 92 110

Core Taxpayer Services and Enforcement - Subtotal $158,958 $114,200 $150,019

FTE 199 122 110

Application Program Interface (API) Implementation

$252 $0 $0

Capital 0 0 0

Support 0 0 0

Labor 252 0 0

FTE 1 0 0

Modernized IRS Operations - Subtotal $252 $0 $0

FTE 1 0 0

APIs are a set of protocols, routines, functions and/or commands that programmers use to develop software or 

facilitate interaction between distinct systems. In response to growing demands to integrate systems internally and 

externally, the IRS plans to expand the use of APIs across its ecosystem. 

Providing modernized individual tax processing. Completion of the “Customer Account Data Engine” (CADE) 

Transition State 2 (TS2) will help modernize the technology environment that enables the IRS to process more than 

150 million individual tax returns each year. This modernization enables enhanced data accessibility for online 

taxpayer services; implements the latest financial requirements and security controls; and, supports business units to 

deploy advanced analytical capabilities addressing key issues of compliance, fraud, and identity theft. Funding in FY 

2023 will ensure the Individual Tax Processing Engine (ITPE) project, which is a key component of TS2, is able to 

convert approximately 200,000 lines of legacy assembly language code to modern software language.

Providing a modernized case management platform. The IRS routinely interacts with individual taxpayers, small and 

large businesses, tax-exempt organizations, and a wide spectrum of intermediaries. The current case management 

environment, comprised of multiple systems that often do not communicate with each other, causes the IRS to treat 

each selected interaction as a separate case, which significantly limits the effectiveness and efficiency of each case 

interaction. This disconnect adds frustration and prolongs case resolution. Funding will ensure the complex 

undertaking of transitioning to an enterprise case management system with standard business processes. The main 

benefit is that authorized IRS employees will be able to see an individual taxpayer’s entire range of tax issues, relevant 

case data, and communications, which will ultimately resolve cases faster. 

Modernized IRS Operations

Improving interactions and communications with taxpayers, the IRS, and third parties by providing a broad range of 

self-service options, establishing secure information exchange, and building internal capabilities. By enabling 

authorized third parties and taxpayers to interact digitally with the IRS, Web Apps provides a better user experience 

and delivers consistent data and services. Web Apps will expand on a broad range of digital services the taxpayer 

and their representatives can complete securely using their IRS online account. They will be able to: enter into longer 

term payment plans and obtain payment plan default status, update contact information; schedule and modify 

scheduled payments; store bank information, opt in for digital notices/opt out of paper notices, obtain real-time 

responses through chat features, and enable secure messaging all within online account. This results in more timely 

and accurate information to taxpayers leading to improvement in revenue collection and promoting voluntary 

compliance. 

IRA BSM

Implementation of Call Center technologies to improve the taxpayer experience. This includes both taxpayer-facing 

capabilities and infrastructure improvement to support the capabilities. Funding for Live Assistance ensures 

functionality that may include callback, live chat, automated chat, natural language processing, etc., which will help 

alleviate taxpayer frustration related to long wait times, when millions of phone calls are received each year via IRS' 

many toll-free numbers, especially during the filing season.

Core Taxpayer Services and Enforcement Taxpayer Experience
IRS-76 

*Programs are supplemented by the IRA BSM mandatory funding. In FY 2023, WebApps is supplemented with $150M in IRA funding and ECM with $75M.

1 Capital Investment funding: capital and contractor labor costs. Support funding: training, travel, supplies costs. Labor funding: IRS employee pay and 

benefits costs. 2 The FY 2023 Mandatory amount is an estimate as of 10/22 and may change as the portfolio evolves. Pillar

Business Systems Modernization

Dollars in thousands

Funding

Category1

FY 2022 

Actuals

FY 2023 BSM 

Plan

FY 2024 

President's 

Budget Request 

Vulnerability and Threat Management* $14,543 $15,000 $0

Capital 13,446 13,500 0

Support 0 0 0

Labor 1,097 1,500 0

FTE 6 7 0

Identity and Access Management* $20,039 $25,000 $0

Capital 19,813 24,673 0

Support 0 0 0

Labor 225 327 0

FTE 1 2 0

Security Operations and Management* $6,650 $5,000 $0

Capital 6,591 4,800 0

Support 0 0 0

Labor 59 200 0

FTE 0 1 0

Cybersecurity and Data Protection - Subtotal $41,232 $45,000 $0

FTE 7 10 0

Architecture, Integration, and Management $4,644 $10,000 $9,600

Capital 3,941 9,232 8,147

Support 0 25 0

Labor 703 743 1,453

FTE 3 3 7

Subtotal Supporting Project $4,644 $10,000 $9,600

FTE 3 3 7

 Supporting Project Provide system engineering management capabilities, including systems strategy, architecture, and engineering 

capabilities, across IT Infrastructure, Business Applications, Data Management, and IT Security. Provide portfolio 

control and management processes and tools, including governance, enterprise lifecycle support, tiered program 

management, and configuration/change management.

Cybersecurity and Data Protection

Enabling proactive threat and vulnerability identification. This is achieved by using real-time intelligence 

information and analytics, enhance security testing and process automation, protect sensitive data at rest through 

encryption, and enhance both application and infrastructure audit capabilities to detect breaches and mitigate 

internal and external threats effectively. Funding will ensure the IRS focuses on preventing unauthorized access to tax 

accounts and unauthorized disclosure of taxpayer data. These capabilities provide full visibility into servers and 

endpoints for monitoring and analyzing data to identify and prevent threats. 

Preventing malicious and unintended access and disclosure of taxpayer and other sensitive data by establishing 

trusted and streamlined access to information through implementing Identity Access Management, Infrastructure 

Integrity, and Privilege Management capabilities. Identity and Access Management (IAM) refers to the processes, 

technologies and policies for managing users’ digital identities and controlling their use to access enterprise 

resources. 

Securing taxpayer data and systems. Funding security operations and management includes those activities needed 

to secure taxpayer data and the systems that handle or store that data through full visibility of hardware and 

software on the network, as well as enhance incident response and detection of internal threats to data and systems.
IRS-77 

C – Changes in Performance Measures

In FY 2022, the Department of Treasury and IRS developed and implemented two new inventory 

indicators. These indicators provide a broader picture of the CSRs whose daily priorities include both 

answering phones and processing paper inventory. The indicators measure the total ending accounts 

management adjustments and correspondence inventory and the percentage of that inventory that was 

closed during the fiscal year compared to the amount received. These provide a clear picture of the 

volume of work and the progress made in reducing outstanding case amounts compared to current-year 

receipts. IRS also provides phone service to taxpayers using automation. During FY 2022, nearly 

34 million taxpayers received the answers to their questions through automation. The IRS has developed a 

new measure, LOS(A), to be baselined in FY 2023, that expands on CSR LOS to include these automated 

calls. 

Performance Measure or 

Indicator

Proposed Change and Justification

1 Ending Inventory The total ending inventory indicator is defined as the count of 

outstanding accounts management and correspondence inventory and 

will come from the total ending inventory report. This indicator 

provides information on the full scope of a CSR’s daily responsibility 

to both answer incoming phone calls and process adjustment cases 

simultaneously. It provides a clear indication of the total number of 

outstanding accounts management and correspondence inventory 

cases at a given point in time.

2 Percent of closures to 

receipts

The percent of closures to receipts indicator is defined as the 

percentage of adjustment cases closed compared to the number of 

adjustment cases received within a given timeframe and will come 

from the percent of closures to receipts on the inventory report. This 

indicator provides information on the full scope of a CSR’s daily 

responsibility to both answer incoming phone calls and process 

adjustment cases simultaneously. It provides a clear indication of the 

efficiency at which CSRs can process adjustment cases.

3 LOS(A) In addition to live assistors, the IRS also provides phone service to 

taxpayers using automation. During FY 2022, nearly 34 million 

taxpayers received the answer to their questions through automation. 

To help capture the volume of this assisted population, the IRS is 

developing a measure for inclusion in performance reporting that 

expands on Customer Service Representative (CSR) LOS to include 

these automated calls. LOS(A) is defined as the number of toll-free 

callers that receive a response to their inquiry by an assistor or 

through automated responses divided by the total number of 

attempted calls. The LOS(A) measure has been developed for 

baseline reporting in FY 2023.
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Section III – Supplemental Information

3.1 – Summary of Capital Investments

I. Introduction

The IRS Information Technology (IT) organization enables the business operations and modernization 

of the nation’s tax system. IT continues to provide critical support needed as the IRS faces an 

ever-changing and complex tax administration environment and has experienced large shifts in

operations since releasing the IRS Integrated Modernization Business Plan in 2019. Since then, the 

IRS has navigated unexpected changes that have both challenged and accelerated modernization 

efforts—from the emergence of new technology and increased taxpayer expectations to the passage of 

the Inflation Reduction Act of 2022 (IRA). This legislation provided the funding necessary to 

transform the way the IRS operates, which required a fresh look to ensure planning and goals are in 

line with the changes the IRS wants to make and taxpayers deserve. The IRA transformation planning 

taking place now will result in a Strategic Operating Plan (SOP), a ten-year framework for the IRS’s 

transformation efforts. The IRS will continue to adapt as it embraces industry-leading technology and 

meets taxpayer needs in an ever-evolving digital world.

Although the IRS received $4.75 billion in BSM funding in IRA, the modernization required to 

support 21st century tax administration requires sustained annual discretionary funding in addition to 

mandatory funding. Successful implementation of the forthcoming IRA SOP will require that 

discretionary BSM funding be restored in order to enable the envisioned transformative modernization 

to be realized. Without discretionary funding, approximately one-third of the planned modernization 

that IRS envisions will need to be descoped, delayed, or entirely withdrawn. 

With the funding provided through the IRA and other resources, the IRS has strong momentum 

behind modernization, with a clear vision for delivering near-term impact and long-term 

transformation. As the Deputy Commissioner Services and Enforcement has noted, IRS employees 

are making a difference and want to continue to successfully pursue the IRS mission on behalf of the 

country. The road ahead is full of challenges, both known and unknown, but the IRS is confident that 

the plan paves the way to providing the highest-quality service to taxpayers and the tax community.

The Capital Investment Strategy is guided by the IRS Mission, IT Mission, and IT Vision. Coupled with 

the forthcoming IRA SOP, these key strategic documents provide direction and present how the 

technology initiatives and IT investments achieve this vision. 
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II. IT Strategic Plan

As part of the Taxpayer First Act, the IRS developed and is implementing a multi-year IT strategic 

plan that strengthens the agency’s ability to communicate and plan for long-term technology needs.

The IRS developed the IT Strategic Plan to articulate goals and objectives to achieve the IRS 

technology target state and deliver value to taxpayers. This plan is structured to address key factors 

driving the opportunity for change, including the need to meet the public’s expectations, simplify the 

existing IRS technology base, adopt emerging technology trends, stay ahead of cybersecurity threats, 

comply with federal mandates and guidelines, and support the workforce. The implementation of 

these goals and objectives is captured through the Annual Key Insights Report and the integrated 

enterprise architecture, which includes the Enterprise Technology Blueprint and the Target Enterprise 

Architecture (TEA).

Figure 1 – IT Strategic Goals FY 2022-2026

The IT Strategic goals set the enterprise-wide technological priorities, which then inform the long-term 

technological vision published in the Enterprise Technology Blueprint.
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III. Enterprise Architecture Roadmap (EAR)

The Enterprise Architecture Roadmap articulates the envisioned long-range technology environment 

and describes how technology will be employed in support of the strategic IRS business direction. 

This artifact depicts the adoption of advancing capabilities and modernizing applications and technical 

services within the IRS production environment. As shown in Figure3, the EAR is organized around 

the interrelated elements of the IRS Enterprise Architecture framework, to provide a cross-cutting 

frame of reference for analyzing the current state of IRS operations and to envision a future state. It is 

intended to facilitate dialogue among IRS business and IT leaders around future vision and priorities,

align business and IT strategies, guide enterprise architecture planning and solutions development, and 

enable line of sight for evaluating investment proposals. The EAR also encompasses a set of 

interrelated views that depict the future of tax systems, IT operations, and IT services to achieve the 

IRS vision. The EAR is a living document that is continuously reviewed and updated as appropriate. 

Figure 2 IRS Enterprise Architecture Framework
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The Enterprise Target Reference Architecture depicts the target state of the IRS business and technical 

ecosystem, identifying the key capabilities within each Business and Technical Area, aligned within 

their respective transformation pillars.

Figure 3 Enterprise Target Reference Architecture

In combination with the IRS and IT Strategic Plans, the Enterprise Architecture Roadmap (EAR) 

captures the enterprise vision for the IRS technology environment. The IRS Modernization Portfolio, 

described in Section IV, highlights specific technology initiatives and IT investments that realize this 

vision. 
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IV. IRS IT Modernization Portfolio Overview

The IT Modernization Portfolio outlines the work needed to modernize the IRS, allowing for the

achievement of the IRS’s Transformational Outcomes and Strategic Goals. IT Modernization is 

organized around four Pillars – Taxpayer Experience, Core Taxpayer Services and Enforcement, 

Modernized IRS Operations, and Cybersecurity and Data Protection. 

Taxpayer Experience

The IRS will provide taxpayers a wide range of modern options for interacting with the IRS to 

answer questions and resolve tax issues. The agency will deliver real benefits for taxpayers, 

tax professionals, and the tax community, while allowing IRS employees to operate more 

efficiently and effectively. 

Core Taxpayer Services and Enforcement

The IRS will evolve core tax systems through data-driven operations and decision-making, 

real-time tax processing, and core tax administration systems integration. The IRS will use 

technology to enhance identification of noncompliance and fraud while reducing processing 

time for taxpayers. The IRS will also improve compliance through earlier intervention, easier 

(self) correction options, and powerful enterprise platforms. 

Modernized IRS Operations

The IRS will improve underlying system infrastructure by reducing the complexity of the 

agency’s technical environment, enhancing, and expanding workforce support technologies, 

and adopting leading industry practices and technologies that deliver new and sustained 

efficiencies like cloud and robotic process automation. 

Cybersecurity and Data Protection

The IRS will ensure taxpayer administration and operational data are safe and secure from all 

internal and external threats. The IRS will implement “zero trust” to enhance management 

capabilities for vulnerability identification, threat assessment, identity verification, access 

controls, cybersecurity operations, and network security. These improvements are necessary to 

secure information assets in a dynamic cybersecurity landscape and to facilitate successful 

taxpayer interactions in support of the IRS mission. 

For each of these four pillars, the IRS has identified key objectives that represent the impacts and 

expected outcomes of modernization. The objectives are achieved by implementing a set of programs 

and initiatives in that Pillar. These programs are combined into logical Program Groupings that lead to 

outcomes that streamline delivery and bring real value to taxpayers and the workforce. The IRS 

recognizes that to keep pace with an evolving technological landscape, individual programs may 

change over time. The objectives and program groupings illustrated in Figure 4 reflect the IRS’s 

current plans for modernization, subject to expansion with the forthcoming published IRA Strategic 

Operating Plan.
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Figure 4: IRS IT Modernization Portfolio Organizing Construct

Fundamental to the success of IRS modernization is a strong technology environment that supports 

the growth of IRS programs and increases operational efficiency. The IRS will establish a robust IT 

foundation through Program Groupings within the Modernized Operations Pillar. These Technology 

Modernization Foundation Areas (Tech Foundation Areas) include Cloud, Data & Analytics, and IT 

Service Management.

This enables the IRS to improve its technology foundation by implementing flexible, industry-leading 

platforms and infrastructure that can rapidly scale and adapt in the face of new legislation and 

changing taxpayer needs. 

Collectively these Tech Foundation Areas will enable programs across all four modernization Pillars. 

For example, cloud technology implemented in the Modernized IRS Operations pillar provides a 

platform on which individual and tax professional accounts will be built to adapt quickly and 

efficiently to future taxpayer needs under the Taxpayer Experience Pillar.

The IRS IT Modernization Portfolio directly advances three cross-agency priority goals included in 

the President’s Management Agenda and is aligned to both the Treasury and IRS Strategic Plan:

1. Modernize IT to increase productivity and security

2. Leverage data as a strategic asset

3. Improve customer experience with Federal services
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3.2 – IRS Performance Measures Table

*FY 2023 and FY 2024 targets assume discretionary and IRA funding.

1 The CSR LOS includes toll-free telephone lines answered by Accounts Management assistors only. The IRS will strive to achieve an 85 percent 

LOS during individual filing season for both FY 2023 and FY 2024.

2 Historical data provided for comparative purposes.

3 Based on the American Customer Satisfaction Index (ACSI) survey; the All-Individual Tax Filer score is calculated from separate ACSI 

Individual Paper Filer and Electronic Filer.

4 This measure was an indicator in FY 2022 and transitioned to a measure with a target starting in FY 2023.

5 Audits of high-income individuals may take a revenue agent upwards of 250 hours to complete. 6 Due to the timing of hiring and the start date of the lengthy training cycle, the impact of hiring from IRA funding on performance will not be 

realized until at least FY 2025 and the FY 2024 target is lower than FY 2023.

7 The impact of hiring on performance is not immediate due to required training for new Revenue Agents and the average case cycle time of 

about 36 months for these large corporations. Targets in FY 2024 are lower due to the training needs of new hires, case cycle time, and resources 

being applied to work High Income Individual and Partnership cases (more than 2,500 total in FY 2023 and 2,800 in FY 2024). 

8 The impact of hiring on performance is not immediate due to required academy and on-the-job training (6+ months) as well as the average cycle 

time it takes to complete an investigation (400-500 days). 9 Target based on industry standard.
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Customer Service Representative (CSR) Level of 

Service (LOS)

The number of toll-free callers that either speak to a Customer Service Representative or receive informational messages 

divided by the total number of attempted calls.

Total Ending Inventory The total number of accounts management and correspondence inventory.

Percent of Closures to Receipts Percentage of the number of adjustment cases closed compared to the number of adjustment cases received.

LOS(A) The relative success rate of taxpayers that call seeking assistance from IRS and receive a response to their inquiry by an 

assistor or through automated responses divided by the total number of attempted calls. 

Customer Accuracy - Tax Law Phones The percentage of correct answers given by a live assistor on toll-free tax law inquiries.

Customer Accuracy - Accounts (Phones) The percentage of correct answers given by a live assistor on toll-free account inquiries.

Timeliness of Critical Individual Filing Season Tax 

Products to the Public

The percentage of Critical Individual Filing Season (CIFS) tax products available to the public seven calendar days 

before the official IRS start of the (individual) filing season. CIFS tax products are those tax forms, schedules, 

instructions, and publications required by a large number of filers to prepare a complete and reasonably accurate 

Individual Income Tax Return.

Timeliness of Critical TE/GE and Business Tax 

Products to the Public

The percentage of Critical Tax Exempt/Government Entities (TE/GE) and Business (CTB) tax products available to the 

public seven calendar days before the official IRS start of the individual filing season. CTB tax products are forms, 

schedules, instructions, and publications used by large number of TE/GE and Business filers to prepare a complete and 

reasonably accurate return or form by the filing date occurring during the fiscal year (e.g., income tax, excise tax, exempt 

organization return, etc.).

Enterprise Self-Assistance Participation Rate 

(ESAPR) The percentage of taxpayer assistance requests resolved using self-assisted automated services.

Taxpayers Satisfied with the IRS

The percentage of taxpayers satisfied with the IRS according to the American Customer Satisfaction Index (ACSI) 

survey. The All Individual Tax Filer score is calculated from separate ACSI Individual Paper Filer and Electronic Filer 

Customer Satisfaction Index Scores. Based on a 100-point scale.

Examination Efficiency - Individual (1040) The sum of all individual 1040 returns closed by SB/SE, W&I, TE/GE, and LB&I (Field Exam and Correspondence 

Exam programs) divided by the total Full-Time Equivalent (FTE) expended in relation to those individual returns.

Time to Start Compliance Resolution The percentage of all individual income tax enforcement cases started within six months of the return posting date.

Time to Resolve Compliance Issue After Filing The median time it takes to close all individual income tax enforcement cases in days (excluding disaster, bankruptcy, and 

TEFRA cases for exam and collection cases that are not closed as full paid), starting from filing date.

Repeat Non-Compliance Rate The percentage of individual taxpayers in a fiscal year with additional non-compliance two years after the initial tax year 

that contains a filing, payment, or reporting compliance issue, compared to total taxpayers.

Collection Coverage The volume of collection work disposed compared to the volume of collection work available.

Exam Starts – High Income Individuals The number examinations started during the fiscal year of individuals with a total positive income of $10 million and 

above.

Exam Starts – Partnerships The number examinations started during the fiscal year of partnerships.

Exam Starts – Large Corporations 

(Assets>=$250M)

The number examinations started during the fiscal year of large corporate returns reporting assets of $250 million and 

above.

Cost to Collect $100 The cost of collecting $100 is computed as total operating costs divided by gross collection divided by 100.

Criminal Investigations Completed

The total number of subject criminal investigations completed during the fiscal year, including those that resulted in 

prosecution recommendations to the Department of Justice as well as those discontinued due to a lack of prosecution 

potential. 

Conviction Rate The percent of adjudicated criminal cases that result in convictions.

Rentable Square Feet Per Person The amount of Rentable Square Feet the IRS maintains per person requiring space.

Percent of Aged Hardware This measure shows the quantity of IT hardware in operation past its useful life as a percentage of total hardware in use. 

Percent of Major IT Investments within +/-10% 

Cost Variance at the Investment Level

Number of major IT investments within +/-10 percent variance between planned total cost and projected/actual cost 

within a fiscal year divided by the total number of major IT investments in that fiscal year.

Percent of Major IT Investments within +/-10% 

Schedule Variance at the Investment Level

Number of major IT investments within +/-10 percent variance between planned days and projected/actual days within a 

fiscal year divided by the total number of major IT investments in that fiscal year.

Budget Level Performance Measure Descriptions
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3.3 – Return on Investment (ROI) for IRS Major Enforcement Programs

The actual cost and actual revenue collected for FY 2018 through FY 2022 for the three major 

enforcement programs, Examination, Collection, and Automated Underreporter (AUR) are 

provided below. The following activities are included: 

Examination Program conducts examinations of tax returns of individual taxpayers, businesses, 

and other types of organizations to verify that the tax reported is correct. This includes 

examinations of individuals, small businesses, self-employed, large corporate businesses, 

partnerships, international, estate and gift, excise tax and employment tax-exempt organizations, 

qualified pension benefit plans, and government entities. The examination costs include the cost 

of Field Exam, Correspondence Exam, IRS Chief Counsel, and Appeals functions. 

Collection Program collects delinquent taxes and secures delinquent tax returns through the 

appropriate use of enforcement tools, such as lien, levy, seizure of assets, installment agreement, 

offer-in-compromise, substitute-for-return, summons, and IRC section 6020(b) (which allows the 

IRS to prepare returns if a taxpayer neglects or refuses to file), and provides education to 

taxpayers to enable future compliance. The cost of the Collection program includes Automated 

Collection System, Field Collection, and Payment Compliance/Correspondence Collection. 

Automated Under Reporter (AUR) Program matches payer information returns (Forms 1099, 

W-2, etc.) against data reported to the IRS on individual tax returns. The information is verified 

to identify any discrepancies. If a discrepancy is found, the case is given to a tax examiner for 

research and analysis. If the tax examiner is unable to resolve the discrepancy, the IRS issues a 

proposed notice and generates a proposed assessment. 

ROI is calculated by dividing revenue by cost. This information provides an indication of the 

ROI for the three major enforcement programs over time. Enforcement revenue collected in a 

fiscal year includes tax, interest, and penalties from multiple tax years. Some enforcement 

activities take more than a year to close and may generate revenue over several years. 

In addition, this data reflects the average return on investment for these programs and does not 

include the indirect effects of IRS enforcement activities on voluntary compliance. Net revenue 

is maximized only when resources are allocated according to marginal direct and indirect return 

on investment, but those ratios are much more challenging to estimate than the average ROI. As 

a result, the IRS will continue to allocate enforcement resources across a range of enforcement 

activities to ensure taxpayers pay the taxes they owe.

1

The cost of the enforcement programs was calculated using budget data from the IRS Integrated Financial System (IFS) and includes direct 

dollars and FTE from the Enforcement appropriation, Exam and Collections budget activity, and dollars from the Operations Support 

appropriation prorated using actual FTE realized for each major enforcement program.

Dollars in Millions

Enforcement Program Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI Cost1 Revenue ROI

IRS Total $5,559 $59,366 10.7 $5,439 $57,523 10.6 $5,560 $51,084 9.2 $5,634 $74,999 13.3 $5,969 $72,366 12.1

Examination 3,716 15,017 4.0 3,581 10,877 3.0 3,750 8,253 2.2 3,792 11,275 3.0 4,000 9,170 2.3

Collection 1,635 38,985 23.8 1,631 41,793 25.6 1,616 38,948 24.1 1,593 57,834 36.3 1,741 57,874 33.2

Automated Underreporter (AUR) 208 5,364 25.7 226 4,853 21.5 194 3,884 20.0 249 5,889 23.7 228 5,323 23.4

FY 2018 FY 2019 FY 2020 FY 2021 FY 2022
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Section IV – Appendix 

4.1 - COVID-19 Supplemental Funding

Table 1: Spend Plan Including Realignments and OED through February 26, 2023 

Coronavirus Response Discretionary Appropriations - Internal Revenue Service 

1 Spend plan requirements are estimated based on current projections and additional realignments may be necessary.

The IRS received $1.465 billion in the American Rescue Plan Act for a third round of economic 

impact payments and information technology modernization. IRS also received $397.2 million to 

carry out advance payments for the Child Tax Credit. For additional information on IRS’s 

COVID related programs, please refer to the Treasury Coronavirus Relief, Response, Aid, and 

Recovery Programs Congressional Justification. 

4.2 – Summary of IRS FY 2024 Cybersecurity Budget Request

Appropriation

$ in Thousands

Initial Spend 

Plan

Net 

Realignments

Current Spend 

Plan

Obligations through 

February 26, 2023 Balance

American Rescue Plan

Taxpayer Services $422,125 $244,953 $667,078 $637,033 $30,045

Advance Tax Year 2021 Child Tax Credit (P.L. 117-2) - Expired 206,300 42,095 248,395 248,392 2

Cost of Economic Impact Payment 3 (P.L. 117-2) 215,825 37,212 253,037 249,323 3,714

Taxpayer Assistance (P.L. 117-2) 165,646 165,646 139,318 26,328

Operations Support $939,575 ($63,353) $876,222 $803,460 $72,762

Advance Tax Year 2021 Child Tax Credit (P.L. 117-2) - Expired 190,900 (42,095) 148,805 147,386 1,419

Cost of Economic Impact Payment 3 (P.L. 117-2) 248,675 (37,212) 211,463 207,567 3,896

Cost to Integrate, Modernize, and Secure IRS Systems (P.L. 117-2) 500,000 15,954 515,954 448,507 67,447

Business Systems Modernization $500,000 ($181,600) $318,400 $229,293 $89,107

Cost to Integrate, Modernize, and Secure IRS Systems (P.L. 117-2) 500,000 (181,600) 318,400 229,293 89,107

Total American Rescue Plan $1,861,700 $1,861,700 1,669,787 $191,913

Bureau: Internal Revenue Service 

Summary of FY 2024 Cybersecurity Request $000 FTE $000 FTE $000 FTE $000 FTE $000 FTE

FY 2023 Enacted $17,875 46 $20,210 92 $254,720 515 $292,806 654

Changes to Base

FY 2024 Maintaining Current Levels (MCLs) $614 $889 $8,112 $9,615

Pay Annualization (4.6% average pay raise) 95 180 1,121 1,397

Pay Raise (5.2% average pay raise) 327 618 3,847 4,792

Non-Pay 192 91 3,144 3,427

Technical Base Adjustments $137 $137

FERS Law Enforcement Rate Increase 137 137

Subtotal FY 2024 Changes to Base $614 $1,025 $8,112 $9,752

FY 2024 Current Services $18,489 46 $21,236 92 $262,832 515 $302,558 654

Program Increases

Strategies for Improving the Taxpayer Experience 28 28

Green Tax Credit Implementation 138 138

Improve Telephone Level of Service and Reduce Correspondence Inventory 276 276

Restoration of Staffing Levels 102 102

Fleet Electrification 1 1

Sustainment of Deployed IT Capabilities 9 9

Sustaining Infrastructure 5 5

Sustainable and Resilient Buildings 1 1

Subtotal FY 2024 Program Increases $560 $560

Total FY 2024 Request $18,489 46 $21,236 92 $263,393 515 $303,118 654

Dollar/FTE Change FY 2024 Request over FY 2023 Enacted $614 $1,025 $8,672 $10,312

Percent Change FY 2024 Request over FY 2023 Enacted 3.44% 5.07% 3.40% 3.52%

TAXPAYER 

SERVICES ENFORCEMENT OPERATIONS 

SUPPORT BSM TOTAL
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4.3 – Summary of IRS FY 2024 Budget Request 

1 The FY 2023 Enacted level does not include the proposed Inter-Appropriation Transfer from Enforcement ($271.9 million) to Taxpayer 

Services ($100 million), BSM ($150 million), and Operations Support ($21.9 million).

Bureau: Internal Revenue Service 

Summary of FY 2024 Request $000 FTE $000 FTE $000 FTE $000 FTE $000 FTE

FY 2023 Enacted1 $2,780,606 26,881 $5,437,622 34,340 $4,100,826 11,406 $12,319,054 72,627

Changes to Base:

FY 2024 Maintaining Current Levels (MCLs) $132,617 $261,401 $142,647 $536,665

Pay Annualization (4.6% average pay raise) 27,980 56,683 22,086 106,749

Pay Raise (5.2% average pay raise) 99,226 194,545 76,955 370,725

Non-Pay 5,411 10,173 43,606 59,190

Technical Base Adjustments $231,236 $50,234 $281,470

FERS Law Enforcement Rate Increase 50,234 50,234

Improve Competitiveness of IRS Clerical Staff 44,220 44,220

Change in Staffing Designation 187,016 187,016

Subtotal FY 2024 Changes to Base $363,853 $311,635 $142,647 $818,135

FY 2024 Current Services $3,144,459 26,881 $5,749,257 34,340 $4,243,473 11,406 $13,137,189 72,627

Program Increases:

Strategies for Improving the Taxpayer Experience 9,000 35 32,381 19 41,381 54

Green Tax Credit Implementation 75,233 1,221 30,398 105,631 1,221

Improve Telephone Level of Service and Reduce Correspondence Inventory 193,757 3,448 73,433 267,190 3,448

Restoration of Staffing Levels 143,115 547 24,522 9 167,637 556

Fleet Electrification 12,069 3 3,029 15,098 3

Sustainment of Deployed IT Capabilities 55,878 43 55,878 43

Sustaining Infrastructure 27,500 26 27,500 26

Business Systems Modernization 289,619 197 289,619 197

Sustainable and Resilient Buildings 29,462 3 29,462 3

Subtotal FY 2024 Program Increases $277,990 4,704 $155,184 550 $276,603 100 $289,619 197 $999,396 5,551

Total FY 2024 Request $3,422,449 31,585 $5,904,441 34,890 $4,520,076 11,506 $289,619 197 $14,136,585 78,178

Dollar/FTE Change FY 2024 Request over FY 2023 Enacted $641,843 4,704 $466,819 550 $419,250 100 $289,619 197 $1,817,531 5,551

Percent Change FY 2024 Request over FY 2023 Enacted 23.08% 17.50% 8.58% 1.60% 10.22% 0.88% 14.75% 7.64%

TAXPAYER SERVICES ENFORCEMENT OPERATIONS SUPPORT BSM TOTAL