Treasury Inspector General for Tax Administration 

Mission Statement 

To provide integrated audit, investigative, and inspection and evaluation services that 

promote economy, efficiency, and integrity in the administration of the internal revenue 

laws. 

Program Summary by Budget Activity 

Dollars in Thousands 

Appropriation FY 2009 FY 2010 FY 2011

ARRA Enacted Enacted Request $ Change % Change

 Audit $5,600 $55,186 $57,421 $58,725 $1,304 2.3%

 Investigations $1,400 $90,897 $94,579 $96,727 $2,148 2.3%

Total Appropriated Resources $7,000 $146,083 $152,000 $155,452 $3,452 2.3%

Total FTE - 835 835 835 - -

FY 2011 Priorities 

• Adapting to the Internal Revenue Service’s (IRS) continuously evolving operations 

and mitigating intensified risks associated with modernization, security, addressing 

the tax gap, and human capital challenges facing the IRS in domestic and 

international operations; 

• Responding to domestic and international threats and attacks against IRS employees, 

property, and sensitive information; 

• Improving the integrity of IRS operations by detecting and deterring fraud, waste, 

abuse and misconduct by IRS employees; 

• Conducting comprehensive audits, inspections, and evaluations that include 

recommendations for monetary benefits and enhancing IRS’s service to taxpayers; 

• Informing the American people, Congress, and the Secretary of the Treasury of 

problems and progress made to resolve them; and 

• Overseeing the IRS’s efforts to administer the tax provisions of the American 

Recovery and Reinvestment Act of 2009 (Recovery Act). 

TIGTA - 1 
Table of Contents 

Treasury Inspector General for Tax Administration .................................................... 1

Section 1 – Purpose ........................................................................................................... 3

1A – Description of Bureau Vision and Priorities .......................................................... 3

1B – Program History and Future Outlook ..................................................................... 4

Section 2 – Budget Adjustments and Appropriation Language ................................... 9

2.1 – Budget Adjustments Table ..................................................................................... 9

2A – Budget Increases and Decreases Description ........................................................ 9

2.2 – Operating Levels Table ........................................................................................ 11

2.3 – Appropriations Detail Table ................................................................................ 12

2B – Appropriations Language and Explanation of Changes ....................................... 12

2C – Legislative Proposals ........................................................................................... 13

Section 3 – Budget and Performance Plan ................................................................... 14

3.1 – Budget by Strategic Outcome .............................................................................. 14

3.2.1 – Audit Budget and Performance Plan ................................................................ 18

3.2.2 – Investigations Budget and Performance Plan ................................................... 21

Section 4 – Supporting Materials .................................................................................. 22

4A – Human Capital Strategy Description ................................................................... 22

4.1 – Summary of IT Resources Table ......................................................................... 25

4B – Information Technology Strategy ........................................................................ 26

4.2 – Program Evaluation ............................................................................................. 28

TIGTA - 2 
Section 1 – Purpose

1A – Description of Bureau Vision and Priorities 

The Treasury Inspector General for Tax Administration (TIGTA) was created by 

Congress as a part of the Internal Revenue Service Restructuring and Reform Act of 1998 

(RRA 98). TIGTA’s work is devoted to all aspects of activity related to the federal tax 

system as administered by the IRS. As one of 69 federal offices of Inspectors General, 

TIGTA reviews IRS programs, makes recommendations to improve their effectiveness 

and efficiency, and investigates allegations of fraud, waste, and abuse. TIGTA conducts 

audits that advise the American people, Congress, the Secretary of the Treasury, and IRS 

management of high-risk issues, problems, and deficiencies related to the administration 

of IRS programs and operations. TIGTA’s audit recommendations aim to improve IRS 

systems and operations, while maintaining fair and equitable treatment of taxpayers. 

TIGTA’s investigations ensure the integrity of IRS employees, contractors, and tax 

professionals; provide for infrastructure security; and protect the IRS from external 

attempts to threaten or corrupt the administration of the tax laws. TIGTA’s Office of 

Inspections and Evaluations (I&E) provides responsive, timely, and cost-effective 

inspections and evaluations of IRS challenge areas. TIGTA’s oversight is essential to the 

efficiency and equity of the federal tax administration system. TIGTA ensures that the 

American taxpayer can have confidence that the IRS collects over $2 trillion in tax 

revenue in an effective and efficient manner without fraud and abuse. 

TIGTA’s FY 2011 budget request of $155,452,000 is an increase of 2.3 percent above the 

FY 2010 enacted level. These requested resources will finance critical audit, 

investigative, and inspection and evaluation services, protecting the integrity of tax 

administration on behalf of the Nation’s taxpayers. TIGTA’s audit, investigative, and 

inspection and evaluation priorities include: 

• Adapting to the Internal Revenue Service’s (IRS) continuously evolving operations 

and mitigating intensified risks associated with modernization, security, addressing 

the tax gap, and human capital challenges facing the IRS in domestic and 

international operations; 

• Responding to domestic and foreign threats and attacks against IRS employees, 

property, and sensitive information; 

• Improving the integrity of IRS operations by detecting and deterring fraud, waste, 

abuse or misconduct by IRS employees; 

• Conducting comprehensive audits, inspections, and evaluations that include 

recommendations for monetary benefits and enhancing IRS’s service to taxpayers; 

• Informing the American people, Congress, and the Secretary of the Treasury of 

problems and progress made to resolve them; and 

• Overseeing the IRS’s efforts to administer tax provisions of the American Recovery 

and Reinvestment Act of 2009 (Recovery Act). 

 

TIGTA - 3 
Additionally, TIGTA’s strategic goals contribute to the Department’s goals and 

objectives. These strategic goals are to: 

 

• Promote the Economy, Efficiency, and Effectiveness of Tax Administration; 

• Protect the Integrity of Tax Administration; and 

• Be an Organization that Values Its People. 

TIGTA’s commitment to valuing its people was recognized in the Partnership for Public 

Service’s 2009 Best Places to Work Rankings. TIGTA placed 14 out of 216 in the 

overall index score measuring the performance of agency subcomponents related to 

employee satisfaction and commitment. For TIGTA this was a 4.1 percent positive 

change over the 2007 score. This ranking is based on Office of Personnel Management’s 

(OPM) biennial Federal Human Capital Survey which federal agencies use as 

benchmarks to measure their performance. 

In FY 2011, TIGTA faces the challenge of adapting its oversight activities to address 

increasingly complex and high-risk issues associated with IRS operations. This is 

particularly true in adapting to the renewed focus of the IRS to close the international tax 

gap. This effort will be in addition to TIGTA’s continuing work including assessing IRS 

tax compliance initiatives, evaluating the IRS’s efforts to administer tax provisions in the 

Recovery Act, detecting and investigating fraud and electronic crime, reviewing 

procurement activities, safeguarding taxpayer privacy, evaluating IRS Human Capital 

activities, and requesting IRS program reviews from Congress and other IRS 

stakeholders. Each of these issues presents significant challenges for both TIGTA and 

the IRS. 

In accordance with the requirements of Section 6(f)(1) of the Inspector General Act of 

1978 (as amended), the Treasury Inspector General for Tax Administration submits the 

following information related to its requested budget for FY 2011: 

• The aggregate budget request for the operations of TIGTA is $155,452,000; 

• The portion of this amount needed for TIGTA training is $2,572,000; and 

• The portion of this amount needed to support the Council of the Inspectors 

General on Integrity and Efficiency (CIGIE) is $332,000. 

The amount requested for training satisfies all TIGTA training needs for fiscal year 2011. 

1B – Program History and Future Outlook 

Previously a longstanding enforcement office within the IRS, TIGTA was established as 

an independent office in January 1999 in accordance with RRA 98. TIGTA is mandated 

to provide independent audit, investigative, and inspection and evaluation services 

necessary to improve the quality and credibility of IRS oversight, including oversight of 

the IRS Chief Counsel and the IRS Oversight Board. TIGTA’s audits, investigations, and 

TIGTA - 4 
inspections and evaluations are integral to the equitable treatment of taxpayers by the 

IRS, and in ensuring that collection of federal revenue is completed in a fair, efficient and 

effective manner that is secure from internal and external threats. Oversight activities are 

explicitly designed to identify high-risk systemic inefficiencies in IRS operations and to 

investigate exploited weaknesses in tax administration. 

In addition to those efforts, TIGTA managers and employees were significantly involved 

in assisting in the standup of the Special Inspector General for the Troubled Asset Relief 

Program (SIGTARP). During the organization stage of SIGTARP’s stand-up, TIGTA 

managers and technical experts “stood in” for as-yet-to-be-hired SIGTARP employees. 

Using TIGTA’s electronic meeting expertise and proven multi-location processes, 

TIGTA managers were able to carry out the duties of SIGTARP managers and facilitate 

policy and organizational decisions and screening and hiring of key SIGTARP 

employees. As these permanent employees were brought on board, TIGTA personnel 

helped them to come up to speed rapidly. 

The passage of the American Recovery and Reinvestment Act of 2009 (Recovery Act) 

provided funding for the additional workload that will arise from overseeing IRS efforts 

to implement a variety of economic stimulus measures. A key component of the 

Recovery Act is 56 tax provisions to be implemented by the IRS, 20 individual taxpayer 

provisions and 36 business taxpayer provisions; most tax provisions became effective in 

FY 2010. Through a comprehensive risk assessment, TIGTA identified 6 tax provisions 

for immediate audit in FY 2009 and an additional 21 audits and 1 inspection for FY 2010. 

Ten high risk areas have been identified for additional scrutiny; TIGTA’s program plan 

includes detailed information on all ongoing and planned activities. Recovery work is 

allowing TIGTA to revise coordination procedures with the IRS to get interim reports 

published more quickly and available to the public on our website and Recovery.gov; 

successful Recovery coordination changes will have positive long-term impact on 

traditional audits and inspection timelines. Recent audits have received significant 

attention from the IRS, Congress, and the public: First-Time Homebuyers Credit raised 

issues with how IRS implemented filters to prevent potential abuse. Upcoming reports 

will look at Making Work Pay Tax Credit, efforts to ensure proper use of Recovery 

funds, and health coverage tax credit payment processing.

Because TIGTA is charged with overseeing the IRS, increasing the size and workload of 

the IRS generates additional work for TIGTA. Just as the IRS will need additional agents 

and specialists to accomplish their work, TIGTA will use the FY 2011 program increase 

to enhance critical oversight responsibilities. In many cases, the skills which will be 

required are distinctly different from those required to carry out TIGTA’s current 

domestically-focused activities. 

The President has announced proposals to address illegal overseas tax evasion, closing 

loopholes, and make it more profitable for companies to create jobs in the United States. 

Proposed legislative actions include requiring overseas banks to report income earned by 

Americans in the same fashion that American banks are required to report income for 

their clients. The FY 2011 budget will allow TIGTA to increase its responsibilities in 

TIGTA - 5 
overseeing the IRS as it expands its international taxation work. Without the additional 

resources, TIGTA must reduce oversight of domestic programs as there are no resources 

which can be redirected to meet these new challenges. 

TIGTA continues to provide comprehensive coverage and oversight of all aspects of the 

IRS’s operations. In FY 2009, TIGTA’s overall accomplishments included: 

Ensuring Taxpayer Privacy and Security: Each year, millions of taxpayers entrust the 

IRS with sensitive financial and personal data that is stored in and processed by IRS 

information technology systems. The risk that taxpayers’ identities could be stolen by 

exploiting security weaknesses in the IRS’s information technology systems continues to 

increase, as does the risk that IRS computer operations could be disrupted. Both internal 

factors (such as the increased connectivity of computer systems and greater use of 

portable laptop computers) and external factors (such as the volatile threat environment 

related to increased phishing scams and hacker activity) contribute to these risks. In FY 

2009, the Office of Audit (OA) issued reports addressing business continuity efforts and 

system access control weaknesses. 

To protect sensitive taxpayer information from being jeopardized, TIGTA proactively 

identifies IRS employees who inappropriately access and/or disclose private taxpayer 

information. These violations, known as unauthorized access (UNAX), are often the 

initial phase of IRS employee misconduct and frequently result in the uncovering of other 

criminal violations, including fraud and identity theft. IRS employees who are found to 

have committed UNAX violations are subject to fines and prison terms, if convicted, and 

loss of their job. Since enactment of the Taxpayer Browsing Protection Act in August 

1998, TIGTA investigations have resulted in more than 5,500 adverse personnel actions 

taken by the IRS and 211 criminal prosecutions for UNAX violations through September 

2009. 

The importance of efforts to detect unauthorized access is often underestimated. Too 

often, UNAX is seen as browsing by bored employees. However, TIGTA’s 

investigations have revealed a far more disturbing trend where, in a significant number of 

cases, such unauthorized access was only the first stage in far more serious crimes such 

as falsification of records, fraud, embezzlement, and identity theft. 

In FY 2009, TIGTA established a UNAX modernization group to address all computer 

applications the IRS currently uses that contain sensitive information. This group’s work 

to date includes monitoring the IRS’s efforts to develop and implement an enterprisewide audit trail solution, providing guidance to the IRS on establishing retention policies 

so forensic investigations can be conducted, and ensuring the IRS expands its automated 

capability to proactively detect unauthorized accesses on all computer systems. During 

FY 2009, TIGTA investigators completed 1,767 employee integrity investigations, of 

which 502 were UNAX investigations. These resulted in 32 criminal prosecutions and 

1,179 administrative disciplinary actions against IRS employees. 

TIGTA - 6 
Tax Compliance: Tax compliance initiatives include administering tax regulations, 

collecting the correct amount of tax for businesses and individuals, and overseeing taxexempt and government entities for compliance. Increasing voluntary compliance and 

reducing the tax gap (the tax gap is the difference between the amount of tax that 

taxpayers should pay and the amount that is paid voluntarily and on time) are currently 

the focus of IRS initiatives. Nevertheless, the IRS is facing significant challenges in 

obtaining more complete and timely data, as well as developing the methods necessary 

for interpreting the data. The IRS must continue to seek accurate measures for the 

various components of the tax gap and the effectiveness of the actions taken to reduce it. 

In FY 2009, an OA issued report addressed a segment of the tax gap that includes the 

misclassification of employees as independent contractors. 

TIGTA continues its outreach efforts to IRS employees and the tax practitioner 

community. TIGTA reached out to all facets of the IRS workforce and the tax 

professional community. By doing so, TIGTA developed relationships with these groups 

to assist in identifying crimes against the IRS and taxpayers. From October 2008 through 

September 2009, TIGTA provided 2,142 presentations to more than 69,000 IRS 

employees and educated tax professionals by providing 70 awareness presentations to 

6,690 tax practitioners and preparers. 

Advising Congress: During FY 2009, TIGTA provided one Congressional testimony, 24 

briefings, two Statements for the Record, and two official responses to Congress 

regarding audit, investigative, and inspection and evaluation activities. Through direct 

communication, TIGTA aims to address the interest of Congressional committees on 

critical issues involving IRS operations. 

In FY 2008, TIGTA’s Office of Inspections and Evaluations (I&E) began its first year of 

operation as a separate office after a successful pilot project during FY 2006 and FY 

2007. I&E complements the work of the audit and investigative functions and provides 

TIGTA with additional flexibilities and capabilities to meet its mission and address 

increasing requests for IRS program reviews from Congress and other IRS stakeholders. 

The scope of the group’s efforts ranges from answering Congressional concerns to 

evaluating IRS’s ability to administer the tax laws. I&E will continue to provide TIGTA 

the ability to conduct in-depth evaluations of major IRS functions, activities, and 

programs. I&E has positioned TIGTA well to respond to external stakeholders in a rapid 

response mode. As the group continues its work, I&E expects its influence in overseeing 

tax administration to grow and its service of informing interested parties to expand. 

Erroneous and Improper Payments: As defined by the Improper Payments Information 

Act of 2002 (P.L. 107-300, 116 Stat. 2350), an improper payment is any payment that 

should not have been made or that was made in an incorrect amount (including 

overpayments and underpayments) under statutory, contractual, administrative, or other 

legally applicable requirements. It includes any payment to an ineligible recipient, any 

payment for an ineligible service, any duplicate payment, payments for services not 

received, and any payment that does not account for credit for applicable discounts. For 

the IRS, improper and erroneous payments generally involve improperly paid refunds, 

TIGTA - 7 
tax return filing fraud, or overpayments to vendors or contractors. In FY 2009, OA 

issued reports addressing erroneous payments in the Earned Income Tax Credit Program 

and the issuance of false economic stimulus payments.

Fraud and Electronic Crime: TIGTA’s reviews have identified IRS computer 

weaknesses that could jeopardize the security of personally identifiable information. The 

sensitivity of the data makes the IRS an attractive target for employees, hackers, and 

others who could use the information for fraud and identity theft. TIGTA’s audit, 

investigative, and inspection and evaluation work provides for coverage of this growing 

national problem, providing proactive prevention and detection efforts that are required in 

this highly vulnerable and ever-evolving area. As described in Presidential Decision 

Directive NSC-63, IRS operations that fund the federal government are part of the 

nation’s critical infrastructure. Degradation of the public’s trust in the tax system leading 

to a decline in voluntary compliance represents a potential risk to national security as the 

federal government’s main revenue stream is stymied. 

Audit Outcomes: TIGTA strives to protect the integrity of America’s tax system. 

TIGTA’s audits focus on the economy, efficiency and effectiveness of tax administration. 

TIGTA provides recommendations to improve IRS systems and operations while 

ensuring fair and equitable treatment of taxpayers. Between October 1, 2008, and 

September 30, 2009, TIGTA issued 142 reports identifying approximately $14.7 billion 

in potential financial benefits. These reports also impacted approximately 23 million 

taxpayer accounts in areas such as taxpayer burden, rights and entitlements, protection of 

resources/reliability of information, and increased revenue/revenue protected. These 

audits could return $101 for each $1 invested in FY 2009. 

Investigative Outcomes: TIGTA’s Office of Investigations investigates threats to 

America’s tax system, which could impede collection of tax revenue and taint public 

confidence. Between October 1, 2008, and September 30, 2009, 83 percent of TIGTA’s 

closed investigations generated results, including 1,427 cases of employee misconduct 

referred to the IRS for administrative action and 171 cases accepted for prosecution. 

Even though the IRS is still committed to “stopping UNAX in its tracks,” unauthorized 

access to confidential tax information remains a significant problem. During the same 

period, TIGTA closed 419 UNAX cases, resulting in 401 adverse personnel actions 

against IRS employees. Altogether, 116 employees under investigation for UNAX and 

other violations resigned during the investigation or before any personnel action could be 

taken. 

Inspections and Evaluations Outcomes: I&E took the lead in programming TIGTA’s 

American Recovery and Reinvestment Act of 2009 (Recovery Act) activities. 

Additionally, I&E has reported on several pertinent issues including on-site security 

inspections of Taxpayer Assistance Centers and a study of the tax gap that focuses on offshore and international transactions. Planned evaluations will result in recommendations 

to streamline operations, enhance data quality, and improve the efficiency and 

effectiveness of IRS programs. 

TIGTA - 8 
Section 2 – Budget Adjustments and Appropriation Language 

2.1 – Budget Adjustments Table 

Dollars in Thousands 

Inspector General for Tax Administration FTE Amount

FY 2010 Enacted 835 152,000

Changes to Base: 

Maintaining Current Levels (MCLs): - $2,942

FERS % Change - 46

Non-pay Inflation Adjustment - 343

Pay Annualization - 636

Pay Inflation Adjustment - 1,917

Efficiencies Savings: - ($276)

Procurement Savings - (276)

Subtotal FY 2011 Changes to Base - $2,666

Total FY 2011 Base 835 154,666

Program Changes: 

Program Increases: - $786

CIGIE Fees - 332

Increase Related to IRS Growth - 454

Subtotal FY 2011 Program Changes - $786

Total FY 2011 Budget Request 835 155,452

2A – Budget Increases and Decreases Description 

Maintaining Current Levels (MCLs) ........................................... +$2,942,000 / +0 FTE 

FERS % Change +$46,000 / +0 FTE 

Funds are requested for the increase in agency retirement contribution percentages for GS 

employees from 11.2% to 11.5% for FY 2011 as required by OPM. 

Non-pay Inflation Adjustment +$343,000 / +0 FTE 

Funds are requested for non-pay related items such as contracts, travel, supplies, and 

equipment. 

Pay Annualization +$636,000 / +0 FTE 

Funds are requested for the FY 2011 cost of the January 2010 pay raise. 

Pay Inflation Adjustment +$1,917,000 / +0 FTE 

Funds are requested for the January 2011 pay raise. 

Efficiencies Savings ............................................................................ -$276,000 / +0 FTE 

Procurement Savings -$276,000 / +0 FTE 

TIGTA continues to work with procurement staff and vendors to identify procurement 

savings without compromising program quality. 

Program Increases ............................................................................ +$786,000 / +0 FTE 

CIGIE Fees +$332,000 / +0 FTE 

Funds for Council of Inspectors General on Integrity and Efficiency (CIGIE) will 

specifically support coordinated government-wide activities that identify and review 

TIGTA - 9 
TIGTA - 10 

areas of weakness and vulnerability in federal programs and operations with respect to 

fraud, waste and abuse. 

Increase Related to IRS Growth +$454,000 / +0 FTE 

Since TIGTA is charged with overseeing the IRS, increasing the size and workload of the 

IRS generates additional work for TIGTA. Just as the IRS will need additional agents and 

specialists to accomplish their work, TIGTA will use the FY 2011 program increase to 

enhance critical oversight responsibilities. In addition, the Administration is placing an 

renewed emphasis on addressing illegal overseas tax evasion and closing tax loopholes 

and make it more profitable for companies to create jobs in the United States. The 

$454,000 program increase would help fund this effort. 
2.2 – Operating Levels Table 

Inspector General for Tax 

Administration

FY 2009 

ARRA

FY 2009 

Enacted

FY 2010 

President's 

Budget

Congressio

nal Action

Including 

Rescission

FY 2010 

Enacted 

Level

Proposed 

Reprogram

mings

FY 2010 

Proposed 

Operating 

Level

FY 2011 

Requested 

Level

 

FTE 0 835 835 0 835 0 835 835

Object Classification: 

11.1 - Full-time permanent 4,501 78,314 80,624 1,929 82,553 0 82,553 84,496

11.3 - Other than full-time permanent 0 576 593 0 593 0 593 621

11.5 - Other personnel compensation 497 9,131 9,443 213 9,656 0 9,656 9,897

12 - Personnel benefits 1,603 26,298 27,109 687 27,796 0 27,796 28,411

21 - Travel and transportation of 301 4,834 4,694 129 4,823 0 4,823 4,860

persons 

22 - Transportation of things 0 24 24 0 24 0 24 24

23.1 - Rental payments to GSA 0 8,952 9,143 0 9,143 0 9,143 9,770

23.2 - Rental payments to others 0 288 288 0 288 0 288 292

23.3 - Comm, utilities, and misc 0 2,570 2,570 0 2,570 0 2,570 2,533

charges 

24 - Printing and reproduction 0 8 8 0 8 0 8 8

25.1 - Advisory and assistance 0 1,175 1,135 0 1,135 0 1,135 1,119

services 

25.2 - Other services 0 986 921 0 921 0 921 908

25.3 - Other purchases of goods and 0 7,042 6,710 0 6,710 0 6,710 6,613

services from Govt. accounts 

25.4 - Operation and maintenance of 0 407 407 0 407 0 407 413

facilities 

25.7 - Operation and maintenance of 0 1,277 1,232 0 1,232 0 1,232 1,249

equip 

26 - Supplies and materials 98 1,193 1,164 42 1,206 0 1,206 1,200

31 - Equipment 0 2,805 2,732 0 2,732 0 2,732 2,832

42 - Insurance claims and indemnities 0 150 150 0 150 0 150 152

91.0 - Confidential Expenditures 0 53 53 0 53 0 53 54

Total Budget Authority $7,000 $146,083 $149,000 $3,000 $152,000 $0 $152,000 $155,452

 

Budget Activities: 

Audit 5,600 55,186 56,289 1,133 57,421 0 57,421 58,725

Investigations 1,400 90,897 92,711 1,867 94,579 0 94,579 96,727

Total Budget Authority $7,000 $146,083 $149,000 $3,000 $152,000 $0 $152,000 $155,452

TIGTA - 11 
2.3 – Appropriations Detail Table 

Dollars in Thousands 

% Change

FY 2009 FY 2009 FY 2010 FY 2011 FY 2010

Resources Available for Obligation ARRA Enacted Enacted Request to FY 2011

FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT FTE AMOUNT

New Appropriated Resources:

Audit 0 $5,600 349 $55,186 349 $57,421 349 $58,725 0.00% 2.27%

Investigations 0 1,400 486 90,897 486 94,579 486 96,727 0.00% 2.27%

Subtotal New Appropriated Resources 0 $7,000 835 $146,083 835 $152,000 835 $155,452 0.00% 2.27%

Other Resources:

Offsetting Collections - Reimbursable 0 0 3 900 3 1,300 3 1,300 0.00% 0.00%

Subtotal Other Resources 0 $0 3 $900 3 $1,300 3 $1,300 0.00% 0.00%

Total Resources Available for Obligation 0 $7,000 838 $146,983 838 $153,300 838 $156,752 0.00% 2.25%

2B – Appropriations Language and Explanation of Changes 

Appropriations Language Explanation of 

Changes

DEPARTMENT OF THE TREASURY

TREASURY INSPECTOR GENERAL FOR TAX 

ADMINISTRATION

Federal Funds

General and Special Funds:

SALARIES AND EXPENSES

For necessary expenses of the Treasury Inspector General for Tax 

Administration in carrying out the Inspector General Act of 1978, as 

amended , including purchase (not to exceed 150 for replacement 

only for police-type use) and hire of passenger motor vehicles (31 

U.S.C. 1343(b)); services authorized by 5 U.S.C. 3109, at such rates 

as may be determined by the Inspector General for Tax 

Administration; [$152,000,000] $155,452,000 , of which not to 

exceed $6,000,000 shall be available for official travel expenses; of 

which not to exceed $500,000 shall be available for unforeseen 

emergencies of a confidential nature, to be allocated and expended 

under the direction of the Inspector General for Tax Administration[; 

and of which not to exceed $1,500 shall be available for official 

reception and representation expenses].

TIGTA - 12 
2C – Legislative Proposals 

TIGTA does not have any legislative proposals for FY 2011. 

TIGTA - 13 
Section 3 – Budget and Performance Plan

This table lists all FY 2011 resources by strategic goal, objective and outcome outlined in 

the FY 2007-2012 Treasury Department Strategic Plan. The Treasury Strategic Plan is a 

corporate level plan for the Department that provides a description of what the agency 

intends to accomplish over the next five years. 

For detailed information about the FY 2007-2012 Treasury Strategic Plan, please go to: 

http://www.treas.gov/offices/management/budget/strategic-plan/

3.1 – Budget by Strategic Outcome 

Dollars in Thousands 

Treasury Strategic Outcome FY 2010 

Enacted

FY 2011 

Request Percent Change

 Accountability & trans 153,300 156,752 2.25%

Total $153,300 $156,752 2.25%

3A – Audit ($58,725,000 from direct appropriations and $551,000 from reimbursable 

programs): OA’s mission is to promote the sound administration of the nation’s tax laws 

by conducting comprehensive, independent performance and financial related audits of 

IRS programs. Audits not only focus on the economy and efficiency of IRS functions, 

but also ensure that taxpayers’ rights are protected and the taxpaying public is adequately 

served. 

 

OA strategically evaluates IRS programs and operations so that TIGTA resources are 

expended in the areas of highest vulnerability. To carry out this goal, OA develops an 

annual audit plan that communicates its priorities and incorporates both statutory audit 

coverage and high risk audit work identified through an annual risk assessment process 

and stakeholder requests. By focusing on critical areas, OA ensures that TIGTA audits 

identify and recommend improvements in the most vulnerable IRS programs. 

Between October 1, 2008 and September 30, 2009, TIGTA issued 142 audit reports that 

included potential financial benefits of approximately $14.7 billion and potentially 

impacted approximately 23 million taxpayer accounts in areas such as taxpayer burden, 

rights and entitlements, protection of resources/reliability of information, and increased 

revenue/revenue protected. 

American Recovery and Reinvestment Act of 2009 (Recovery Act): The American 

Recovery and Reinvestment Act of 2009 is an unprecedented effort to jumpstart the 

American economy, create or save millions of jobs, and put a down payment on 

addressing challenges the country faces. The Recovery Act includes multiple tax law 

provisions the IRS must implement. OA identified necessary adjustments to ongoing 

audits along with new audits that must be started in order to ensure that adequate 

coverage is provided to ensure effectiveness of the IRS’s efforts to implement tax 

TIGTA - 14 
provisions. OA will also continue to provide oversight to IRS’s Recovery Act 

implementation through 2013. 

Congress proposed $13.6 billion for the First-Time Homebuyer Credit (Credit) in the 

Housing and Economic Recovery Act of 2008. The Joint Committee on Taxation 

estimated that more than $4.3 billion more would be paid to first-time homebuyers in 

FYs 2009 and 2010 as a result of the revisions in the Recovery Act. TIGTA auditors 

found that certain key controls preventing individuals from erroneously claiming the 

Credit were missing. Despite previous TIGTA recommendations, the IRS did not require 

taxpayers to provide documentation to substantiate the purchase of a home. TIGTA also 

identified approximately 48,500 taxpayers who may not have been aware of the changes 

to the Credit included in the Recovery Act and did not claim the full amount to which 

they were entitled. TIGTA recommended that the IRS develop a plan to address 

questionable claims for the Credit. The IRS agreed with the recommendation. 

Tax Compliance: The IRS estimated the gross tax gap, defined as the difference between 

the estimated amount taxpayers owe and the amount they voluntarily and timely pay for a 

tax year, to be $345 billion in Tax Year 2001. This gap exemplifies the considerable 

challenges the IRS faces in collecting sufficient revenue and the federal tax system’s 

critical dependence on voluntary compliance. 

Of the $345 billion tax gap, about $54 billion (16 percent) is attributable to underreported 

employment taxes. One aspect of underreported employment taxes is the 

misclassification of employees as independent contractors, a nationwide issue affecting 

millions of workers that continues to grow and contribute to the tax gap. TIGTA auditors 

found that the IRS does not have an agency-wide employment tax program to coordinate 

the decision-making process and efforts among its business divisions. The limited data 

available indicates that the worker classification issue is growing significantly. When an 

employee is misclassified, tax revenues are not reported or paid and the burden of 

uncollected taxes shifts to other taxpayers. TIGTA recommended that the IRS develop 

and implement an agency-wide employment tax program to address the issue of worker 

classification to improve coordination among the business divisions, improve 

compliance, and reduce the tax gap. TIGTA also recommended that the IRS consider 

conducting a formal National Research Program compliance study to measure the impact 

of worker misclassification on the employment tax gap. IRS agreed with the 

recommendations. 

An evolving area of the tax gap is the international tax gap. However, TIGTA found that 

the IRS has not developed an accurate and reliable estimate of the international tax gap. 

Non-IRS estimates of the international tax gap range from $40 billion to $123 billion. 

TIGTA concluded that it is doubtful the IRS’s tax gap estimate includes the entire 

international tax gap primarily because identifying hidden income within international 

activity is very difficult and time-consuming. Recent legislative proposals by both the 

Administration and Congress could raise an additional $210 billion from international 

transactions within the next 10 years. In addition, TIGTA found that the IRS has no 

plans to comprehensively measure the international tax gap with a national research 

TIGTA - 15 
project effort due to cost, staffing, and technical limitations. Consequently, there is less 

certainty that international tax compliance resources are efficiently allocated to address 

noncompliance. 

Security of the Internal Revenue Service: The Modernized e-File (MeF) system is an IRS 

system that will provide a single method for filing all IRS tax returns, information 

returns, forms, and schedules via the Internet. The Modernized Tax Return Database (MTRDB), a component of the MeF system, is the authoritative store of accepted returns 

and extensions submitted through the MeF system. TIGTA found that security 

weaknesses in the controls over system access, monitoring of system access, and disaster 

recovery have continued to exist even though key phases of the MeF system and the MTRDB have been deployed. As a result, the IRS is jeopardizing the confidentiality, 

integrity, and availability of an increasing volume of tax information for millions of 

taxpayers as application phases are put into operation. TIGTA recommended that the 

IRS consider all security vulnerabilities that affect the overall security of the MeF system 

and the M-TRDB before approving milestone exits; provide more emphasis to the MeF 

project office to both prevent and resolve security vulnerabilities identified during 

Enterprise Life Cycle processes; and approve interim authorities to operate when 

significant security control weaknesses exist in system environments. IRS management 

agreed with the recommendations and has planned corrective actions. However, the 

corrective actions were focused on continuing to follow or strengthening existing 

processes. TIGTA believes that the security vulnerabilities were not caused by process 

deficiencies. Instead, IRS personnel did not fulfill their responsibilities for correcting 

security vulnerabilities before deployment.

The IRS’s ability to protect its employees and provide taxpayer services during and after 

a major disruption is dependent on the effective preparation of four integrated plans 

called the Business Continuity “Suite of Plans.” However, many of the plans TIGTA 

reviewed were not up to date, had not been adequately tested, and did not contain 

sufficient detail to be effective. These deficiencies could affect the IRS’s ability to 

process 235 million tax returns, issue $295 billion in refunds, and collect over $2 trillion 

in revenue each year. TIGTA recommended that the IRS appoint an executive with 

cross-organizational authority to oversee the IRS business continuity program and serve 

as the chairperson of the Emergency Management and Preparedness Executive Steering 

Committee. TIGTA also recommended that the IRS require the executive responsible for 

business continuity planning to monitor and ensure that comprehensive testing is 

conducted and documented for all business continuity plans, and consider testing 

business continuity plans concurrently as opposed to testing the plans separately. IRS 

agreed with the recommendations. 

Processing Returns and Implementing Tax Law Changes during the Tax Filing Season:

Each filing season tests the IRS’s ability to implement tax law changes made by 

Congress. It is during the filing season that most individuals file their income tax returns 

and call the IRS with questions about specific tax laws or filing procedures. Correctly 

implementing tax law changes is a continuing challenge because the IRS must identify 

the tax law changes; revise the various tax forms, instructions, and publications; and 

TIGTA - 16 
reprogram the computer systems used for processing returns. Changes to the tax laws 

have a major effect on how the IRS conducts its activities, what resources are required, 

and how much progress can be made on strategic goals. Congress frequently changes the 

tax laws; thus, some level of change is a normal part of the IRS environment. However, 

certain types of changes can significantly affect the IRS in terms of the quality and 

effectiveness of its service and in how taxpayers perceive the IRS. 

The IRS issues Individual Taxpayer Identification Numbers (ITIN) to provide a unique 

number for individuals who are not eligible for a Social Security Number (SSN). The 

ITINs help these individuals comply with the tax laws and provide a means to efficiently 

process and account for tax returns. Improvements to the ITIN Program are needed to 

ensure that it is meeting its intent and that refundable credit claims are verified. TIGTA 

made a legislative recommendation to clarify whether refundable tax credits such as the 

Additional Child Tax Credit may be paid to filers without an SSN and, if these credits 

may not be paid, to provide the IRS math error authority to disallow associated claims for 

the credits. Disallowance of the Additional Child Tax Credit to filers without an SSN 

would reduce federal outlays by $8.9 billion over five years. TIGTA also recommended 

that the IRS develop processes to identify individuals who are improperly using ITINs for 

work purposes and develop outreach efforts with the Social Security Administration to 

address the improper use, limit the automatic population feature for ITIN tax returns, and 

ensure that accurate tax information is input into IRS systems from both paper and 

electronically filed ITIN tax returns. IRS agreed to continue to work with software 

companies to limit the auto-populate feature and also agreed to work with the Department 

of the Treasury’s Office of Tax Policy to consider legislation to limit claims for the 

Additional Child Tax Credit to taxpayers with an SSN. However, the IRS disagreed with 

the other recommendations. TIGTA does not believe that IRS provided adequate 

justification for the disagreed recommendations. 

More than half of all tax returns filed are prepared by paid preparers. However, the IRS 

cannot determine the population of preparers or if the preparers are compliant with their 

own tax obligations as well as all tax laws and regulations. Tax return preparers have a 

significant effect on taxpayer compliance. A unique identifying number to control each 

preparer and an effective management information system are necessary for the IRS to 

facilitate tax administration and provide effective oversight of preparers. TIGTA 

recommended that the IRS establish a requirement that paid preparers be compliant with 

their own federal tax filing obligations in order to be allowed to prepare tax returns for 

others for a fee, revise the target completion date for its study on requiring preparers to 

use a single identification number when filing tax returns, and develop a method to 

enforce I.R.C. Section 6695(c), which imposes a penalty on preparers who do not provide 

an identification number on tax returns they prepare. The IRS agreed with the 

recommendations and believes some of the recommendations will be addressed by the 

Commissioner’s Tax Return Preparer Review team as well as a guidance project being 

conducted in coordination with the Department of the Treasury. 

Erroneous and Improper Payments: The fraud exposure to IRS programs and operations 

is tremendous. The IRS collects over $2 trillion annually from taxpayers who entrust the 

IRS with sensitive financial and personal data every year. 

TIGTA - 17 
OA continues its oversight of IRS programs susceptible to erroneous or improper 

payments. OA reported that the IRS successfully developed a number of processes to 

identify erroneous Earned Income Tax Credit (EITC) payments prior to issuance. 

However, because compliance resources are limited and alternatives to traditional 

compliance methods have not been developed, the majority of the potentially erroneous 

EITC claims identified continue to be paid in error. The IRS reports $10 billion to $12 

billion annually in erroneous EITC payments. TIGTA recommended that the IRS 

conduct a study to identify alternative processes that will expand the IRS’s ability to 

effectively and efficiently identify and adjust erroneous EITC claims for which data show 

that the taxpayer does not meet EITC requirements. TIGTA also recommended that the 

IRS work with Treasury’s Assistant Secretary for Tax Policy to obtain the authority 

necessary to implement alternative processes to adjust erroneous EITC claims. IRS 

agreed with the recommendations. 

The IRS issues millions of refunds worth billions of dollars to taxpayers each year 

through its automated and manual systems. The IRS’s inability to promptly resolve some 

accounts with a large dollar refund freeze (a freeze of a taxpayer’s account that has a filed 

tax return and a credit balance of $10 million or more) can adversely affect taxpayers 

who may need the refunds to help meet their financial obligations. These delayed actions 

may also negatively impact the IRS’s mission of providing top-quality customer service, 

in addition to costing the federal government millions of dollars in additional interest. 

TIGTA recommended that the IRS coordinate with its appropriate functional areas and 

follow through with implementing the prior recommendations including to properly 

implement computer system modifications to provide alerts to review large dollar frozen 

taxpayer accounts for credits that can be released, to systemically release the freeze on 

accounts when credits fall below the large dollar refund freeze threshold, and to ensure 

procedures for processing large dollar frozen refunds adequately address common issues 

that arise. The IRS agreed with the recommendations. 

3.2.1 – Audit Budget and Performance Plan 

Audit Budget Activity

Resource Level

FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Obligated Obligated ARRA Obligated Enacted Request

 Appropriated Resources $49,087 $50,852 $5,600 $53,797 $57,421 $58,725

 Reimbursable Resources $300 $539 $0 $361 $551 $551

Total Resources $49,387 $51,391 $5,600 $54,158 $57,972 $59,276

Budget Activity Total $49,387 $51,391 $5,600 $54,158 $57,972 $59,276

Audit Budget Activity

Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Actual Actual Actual ARRA Target Target

Percentage of Audit Products Delivered When 68 65 81 65 65

Promised to Stakeholders (Oe) 

Percentage of Recommendations Made That Have 90 85 91 83 83

Been Implemented (Oe) 

Key: Oe - Outcome Measure, E - Efficiency Measure, and Ot - Output/Workload Measure 

TIGTA - 18 
Description of Performance: The likelihood that TIGTA’s products will be used is 

enhanced if they are delivered when needed to support Congressional and IRS decision 

making. To determine whether products are timely, TIGTA tracks the percentage of 

products that are delivered on or before the date promised (contract date). 

Additionally, TIGTA makes recommendations designed to improve administration of the 

federal tax system. The IRS must implement these recommendations in order for our 

work to produce financial or non-financial benefits. This measure assesses TIGTA’s 

effect on improving the IRS’s accountability, operations, and services. Since the IRS 

needs time to act on recommendations, TIGTA utilizes the Department’s Joint Audit 

Management Enterprise System to track the percentage of recommendations made four 

years ago that have been implemented, rather than the results of the activities during 

the fiscal year in which the recommendations are made. TIGTA is able to track its 

recommendations that have not been implemented by the IRS. TIGTA also has a formal 

process with the IRS for closing out unimplemented recommendations for which 

circumstances may have changed, or for when the IRS has taken alternative corrective 

measures that address concerns identified by TIGTA. 

3B – Investigations ($96,727,000 from direct appropriations and $749,000 from 

reimbursable programs): While most Offices of Inspectors General focus primarily on 

fraud, waste, and abuse, TIGTA’s mission is more extensive. TIGTA has the statutory 

responsibility to protect the integrity of tax administration and to protect the ability of the 

IRS to collect revenue for the federal government. To accomplish this, TIGTA 

investigates allegations of criminal violations and administrative misconduct by IRS 

employees, protects the IRS against external attempts to corrupt tax administration, and 

ensures IRS employee safety and IRS data and infrastructure security. The following 

summaries highlight TIGTA’s investigative efforts in these three core areas: 

Employee Integrity: IRS employee misconduct can hinder the IRS’s ability to collect 

revenue for the federal government. Fifty percent of TIGTA’s current investigations 

involve alleged employee misconduct. In addition to UNAX investigations, employee 

misconduct investigations include allegations of extortion, theft, false statements, and 

financial fraud. TIGTA also administers a proactive integrity program to help detect IRS 

employees who might be committing fraud and other misconduct. From October 1, 2008 

to September 30, 2009, TIGTA initiated 41 proactive investigative initiatives. 

Employee and Infrastructure Security: Congressional concern regarding the magnitude 

of uncollected revenue has prompted the IRS to intensify enforcement activities. 

Heightened enforcement is likely to cause a rise in external threats to IRS employees and 

infrastructure. Both TIGTA’s proactive and reactive investigations are critical to 

mitigating future risks. TIGTA maintains IRS employee and infrastructure security by 

conducting investigations into incidents that threaten IRS employees, facilities, and 

infrastructure. TIGTA’s highest priority complaints involve threats and assaults against 

TIGTA - 19 
IRS employees. TIGTA works aggressively and takes swift action to protect IRS 

employees, including providing armed escorts. In October 2008, the Inspector General 

Reform Act of 2008 was signed into law, which allows TIGTA to provide physical 

security to protect IRS employees against external threats. TIGTA also operates a 

Criminal Intelligence Program that develops and facilitates pertinent information 

regarding potential threats to IRS employees and operations. This program includes 

participation in the FBI sponsored Joint Terrorism Task Forces nationwide. In addition, 

TIGTA has a System Intrusion and Network Attack Response Team to defend against 

hackers who attempt to compromise the data integrity of taxpayer information stored in 

IRS computer systems. From October 2008 through September 2009, Office of 

Investigations (OI) closed 331 investigations of assaults and/or threats made against IRS 

employees and facilities. 

External Attempts to Corrupt Tax Administration: TIGTA is statutorily mandated to 

investigate external attempts to corrupt tax administration, which includes criminal 

misconduct by non-employees, such as, impersonation of IRS employees, interference 

with the administration of internal revenue laws, bribery, misuse of Treasury names, 

symbols, etc., contract fraud, and tax practitioner fraud relating to thefts of taxpayer 

remittances and refunds. 

In FY 2011, OI foresees continued risks in IRS programs that will require more 

oversight. Of great interest and risk are phishing scams that falsely depict e-mails from 

the IRS. (Phishing involves sending e-mails to users falsely claiming to be established, 

legitimate enterprises in order to solicit private information for the purpose of identity 

theft.) Such schemes attempt to retrieve a user’s SSN and banking information by 

replicating an official IRS seal and/or requesting information required for depositing tax 

refunds. The IRS, in coordination with OI, has identified 7,953 phishing sites since 

November 2005 through September 2009. Oversight in this area is necessary to ensure 

that misuse of the IRS name, impersonation of an IRS employee, and identity theft 

incidents are resolved expeditiously. 

With the IRS focusing on increased revenue collection from delinquent taxpayers, OI 

anticipates a rise in attempts to bribe IRS employees involved in those collection 

activities. TIGTA educates IRS employees on how to recognize bribe overtures and their 

responsibility to report bribery attempts to TIGTA. During FY 2009, OI conducted 37 

investigations into bribery of IRS employees by taxpayers. 

Another area of concern that poses risks to tax administration is IRS contract 

improprieties. TIGTA is committed to conducting procurement investigations that ensure 

the highest degree of integrity, economy, and efficiency in IRS contracts. TIGTA 

conducts proactive and reactive investigations to detect and deter criminal activity by 

contractors and IRS employees. TIGTA’s contract fraud work has produced significant 

results, including nearly $62 million in recovered penalties from October 2008 to 

September 2009. 

 

TIGTA - 20 
Investigative work in these three core areas is imperative to protecting the integrity of tax 

administration. The results of this work help ensure that the public has confidence in its 

dealings with the IRS. 

3.2.2 – Investigations Budget and Performance Plan 

Investigations Budget Activity

Resource Level

FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Obligated Obligated ARRA Obligated Enacted Request

 Appropriated Resources $83,427 $89,161 $1,400 $91,979 $94,579 $96,727

 Reimbursable Resources $627 $727 $0 $582 $749 $749

Total Resources $84,054 $89,888 $1,400 $92,561 $95,328 $97,476

Budget Activity Total $84,054 $89,888 $1,400 $92,561 $95,328 $97,476

Investigations Budget Activity

Measure FY 2007 FY 2008 FY 2009 FY 2010 FY 2011

Actual Actual Actual ARRA Target Target

Percentage of Results from Investigative Activities 81 78 83 79 79

(Oe) 

Key: Oe - Outcome Measure, E - Efficiency Measure, and Ot - Output/Workload Measure 

Description of Performance: Examples of the types of criminal activity investigated are: 

bribes offered by taxpayers to compromise IRS employees; manipulation of IRS systems 

and programs through the use of bogus liens and IRS financial reporting instruments; and 

impersonation of IRS officials. As of September 30, 2009, actual performance has 

exceeded expectations (actual performance was 83 percent, while the target was 78 

percent). These results are indicative of OI’s continuous focus on quality investigative 

activities. 

 

For detailed information about each performance measure, including definition, 

verification and validation, please go to: http://treas.gov/offices/management/budget/

TIGTA - 21 
Section 4 – Supporting Materials 

4A – Human Capital Strategy Description 

TIGTA’s human capital strategy is consistent with the goals, vision, and priorities of the 

Department. One of the major goals of the Department of the Treasury is “management 

and organizational excellence.” In alignment with this strategy, one of TIGTA’s major 

goals in assuring effective management and organizational excellence is to be an 

“organization that values its people.” The objective associated with this goal is to 

“ensure a high-quality, diverse, and motivated workforce with the knowledge, skills, and 

abilities needed to produce quality products in an efficient and effective manner.” To 

support this goal, TIGTA has three major Human Capital initiatives for FY 2009 through 

FY 2011: 

TIGTA's Recruitment Advisory Council: This council will be responsible for 

implementing and maintaining a corporate-wide recruitment strategy that includes 

programs within TIGTA that will attract, acquire, develop, promote and retain quality 

talent. 

TIGTA's Performance Management Working Group: This working group will be leading 

the effort in developing a results-oriented performance culture system for TIGTA that 

continues to focus on having a diverse, results-oriented, high-performing workforce, as 

well as a strategically aligned performance management system that effectively plans, 

monitors, develops, rates, and rewards employee performance. 

Corporate Supervisory and Leadership Development Program: TIGTA will be 

developing a corporate supervisory and leadership development program that focuses on 

identifying and addressing leadership competencies so that continuity of leadership is 

ensured, knowledge is shared across the organization, and an environment of continuous 

learning is present. 

 

Over the past ten years, TIGTA’s employee population has declined 17 percent. 

Authorized FTE have declined from 1,000 in 1999 to a current level of 835. Vacancies 

brought on by retirements and other employee departures reduced FTE realized in FY 

2009 to 797. One of the most significant human capital challenges facing TIGTA is the 

ongoing retirement tidal wave. Approximately 34 percent of all TIGTA employees will 

be retirement eligible by September 30, 2013. This is especially troubling since the skills 

required of TIGTA’s auditors, investigators, information technologists, and systems 

specialists are highly specialized and require several years to develop to the journeyman 

level. A continued decline in personnel strength threatens TIGTA’s overall ability to 

effectively fulfill its core mission. 

If TIGTA is unable to fill retirees’ vacated positions with skilled investigators, it will 

reduce TIGTA’s enforcement capacity and circumscribe efforts to combat IRS employee 

misconduct and external threats to the security and integrity of IRS personnel and 

infrastructure, specifically, electronic crimes. FTE attrition further reduces opportunities 

TIGTA - 22 
to examine high-risk areas and thereby can reduce financial benefits from audit 

recommendations and impact fewer taxpayer accounts. Succession planning efforts are 

aimed at addressing these potential risks to TIGTA’s operations. 

With the exiting of retirees, the influx of new staff has required OA to dedicate a 

significant portion of its budget to orient the new hires to the audit process and OA 

requirements, as well as enhance or develop their overall skills/competencies. In order to 

continue to deliver the high quality audit products we strive to produce, it is important for 

TIGTA to continue training opportunities for the entire audit staff. 

TIGTA must address critical staffing deficiencies in terms of having the right number of 

people with the right skills to accomplish its mission. Because of the IRS’s 

modernization effort and its increasingly computerized operating systems and 

environment, TIGTA faces critical skill gaps. Auditors and criminal investigators with 

strong analytical skills and experience using business intelligence tools to identify fraud 

and other improprieties in IRS computer systems are needed. 

TIGTA implemented the Treasury Learning Management System (TLMS) during FY 

2008 with final rollout during FY 2009. With full deployment to its employees, TIGTA 

plans to use the competency assessment functionality portion of the TLMS to identify 

any skill gaps. Currently, this module is not turned on; however, Treasury, in partnership 

with all the bureaus, is working towards making this module available. In addition, the 

bureaus are looking into purchasing a competency module that has more capabilities that 

not only identifies skills gaps but builds individual development plans. Implementing the 

competency assessment module will greatly assist TIGTA in its succession planning 

efforts. Succession planning will help ensure the stability of tenure of personnel by 

providing provisions for the development, replacement, and strategic application of key 

people over time. Early identification of employees with strong leadership potential, 

combined with a range of leadership development programs, will deepen the leadership 

bench strength within TIGTA, and assists tomorrow’s promising leaders with career 

planning. TIGTA will continue its strategic recruitment program to fill critical vacancies 

and align future hiring in geographic areas where most of TIGTA’s workload is located. 

Additionally, TIGTA will continue to enhance its Senior Executive Service (SES) 

development program to grow future leaders within the organization. 

Additionally, TIGTA needs to expand the breadth of the product lines beyond the current 

statutory and high-risk performance audit focus in order to more fully assess risks in the 

tax administration system. To enhance TIGTA’s ability to deliver its mission, OA needs 

to establish a Forensic Auditing Unit whose primary purpose would be to identify 

fraudulent acts affecting the IRS. The Forensic Audit Unit would combine advanced 

computer investigative work with traditional auditing techniques to compare various sets 

of data to more easily connect to possible fraudulent activities and assess situations when 

a fraud has taken place. Traditional auditors try to ensure that internal controls are in 

place to decrease the likelihood of fraudulent acts and follow up when risk factors are 

identified. Forensic auditors on the other hand proactively seek out fraud such as 

employee embezzlement or an employee directing a fictitious vendor payment to his or 

TIGTA - 23 
TIGTA - 24 

her personal bank account. Forensic auditors require a different set of skills and 

techniques such as: data mining, information technology skills, statistics and investigative 

skills. 

The IG Reform Act of 2008 requires that the SES performance management program be 

certified separate from the Department. This will require additional Human Capital focus 

on this program ensuring that TIGTA’s executive performance management program is 

certified by the Office of Personnel Management and ensuring that TIGTA’s executives 

are accountable for supporting TIGTA strategic plans, missions, and organizational 

objectives. 

In order to meet these challenges the expertise, perspectives and innovation of TIGTA’s 

human capital practitioners will be critical. Knowledgeable and highly effective human 

capital practitioners will need to be prepared to work as key partners with TIGTA’s 

leaders to ensure that effective human capital management is a strategic business 

component in achieving TIGTA’s mission. This will require transforming TIGTA’s 

Human Capital team into a cadre of highly valued advisors, facilitators and experts, 

through development and regular engagement with decision makers. Continual learning 

and development is critical for TIGTA’s Human Capital practitioners. 

While the nature and sensitivity of TIGTA’s work limits the possible use of on-site 

contractors, most of the routine human resources transactions, accounting, travel, and 

acquisitions work are outsourced to the Bureau of the Public Debt’s Administrative 

Resource Center. 
4.1 – Summary of IT Resources Table 

Dollars in Thousands 

Information Technology Investments 1/ % Change % 

FY 2008 FY 2009 FY 2010 from FY09 to FY 2011 fro

Major IT Investments / Funding Source Budget Activity & Earlier Enacted Enacted Budget Request FY10 Request 

2/

Subtotal, Major IT Investments N/A N/A N/A N/A N/A 

TIGTA: Audit and 

Performance and Results Information System (PARIS) Investigations Activity $1,000 $1,000 $574 -42.6% $574 

TIGTA: Audit and 

PARIS Property Module (PPM) Investigations Activity $500 $500 $149 -70.2% $149 

TIGTA: Audit and 

Non-Major IT Investments Investigations Activity $1,500 $1,500 $723 -51.8% $723 

TIGTA: Audit and 

TIGTA End User Systems and Services Investigations Activity $8,000 $8,293 $2,678 -67.7% $2,678 

TIGTA: Audit and 

Telecommunications Systems and Services Investigations Activity $3,100 $3,300 $2,465 -25.3% $2,465 

TIGTA: Audit and 

Data Center Systems and Services Investigations Activity $1,000 $1,000 $4,003 300.3% $4,003 

TIGTA: Audit and 

IT Security 3/ Investigations Activity $750 $0 $0 0.0% $0 

TIGTA: Audit and 

Infrastructure Investments 4/ Investigations Activity $12,100 $12,593 $9,146 -27.4% $9,146 

TIGTA: Audit and 

Consolidated Enterprise Content Management 5/ Investigations Activity $0 $129 $0 0.0% $0 

TIGTA: Audit and 

Consolidated Identity Management 5/ Investigations Activity $0 $128 $0 0.0% $0 

TIGTA: Audit and 

Enterprise Architecture Investigations Activity $250 $250 $275 10.0% $275 

TIGTA: Audit and 

Total IT Investments Investigations Activity $13,850 $14,600 $10,144 -30.5% $10,144 

1/ This chart includes appropriated resources only, and may not reflect total project costs.2/ This column reflects appropriated resources provided to a project in FY 2008 and any previous years.3/ The $750 thousand decrease reflects the impact of eliminatinig IT Security as a separate investment and reflecting those resources with End User and Telecommunic

4/ TIGTA costs which were previously not reflected prior to FY 2008.5/ The resources were realigned from End User systems and services to be reflected in the new Enterprise Content Management and Identity Management consolidated 

TIGTA - 25 
4B – Information Technology Strategy 

The Office of Information Technology (IT) provides a full suite of information 

technology products and services on behalf of TIGTA. All IT activities are focused on 

providing secure mobile and interoperable access to data sources that are critical to the 

successful completion of TIGTA’s mission. IT routinely works with auditors, 

investigators, and inspection and evaluation personnel, providing integrated support 

and/or data analysis services to foster the independence of TIGTA oversight and the 

integrity of its audit and investigative findings. 

End User Systems and Services: IT provides traditional end-user systems services for all 

TIGTA employees. This includes the provisioning of personal computers, productivity 

software, electronic mail and other local area network services, such as network storage 

for effective data backup and recovery. IT end user systems and services are based on a 

standardized tool suite for internal TIGTA business operations. This tool suite is 

augmented to provide specialized software tools that permit auditors, investigators, and 

inspection and evaluation personnel to access and analyze data residing on a wide variety 

of IRS and other governmental information systems. IT monitors these tools to ensure 

security and availability, and to determine when technology maintenance and refreshment 

activities are needed for effective protection of TIGTA-accessed data. 

IT provides TIGTA employees with enterprise collaboration tools that allow end users to 

form virtual work teams from any TIGTA office or broadband Internet connection. This 

collaboration capability will reduce travel costs over time and greatly enhances TIGTA’s 

ability to function throughout a widespread disaster event. 

Telecommunications Systems and Services: IT supports its aspects of Treasury T-Net 

with access points throughout the continental United States, Hawaii, and Puerto Rico in 

direct support of a geographically distributed audit, investigative, and inspection and 

evaluation workforce. T-Net provides adequate bandwidth for internal and external data 

transmissions while providing secure access to TIGTA resources, and other governmental 

computer networks and entities. For example, T-Net provides a secure interconnection 

between TIGTA and the IRS that is used for electronic data exchange as well as for costeffective access to IRS information systems. T-Net also enables secure, remote access 

from alternative work locations, supporting an award-winning telework program. TIGTA 

also operates a Land Mobile Radio (LMR) system that permits investigators to safely 

conduct field operations with reliable wireless communication devices. 

Data Center Systems and Services: IT operates information systems at various offices. 

In accordance with the IT Strategic Plan and continuing cost containment measures, IT is 

consolidating information technology services, where feasible, into data center facilities. 

The consolidation effort is designed to increase information system and resource 

utilization, and eliminate unneeded redundancies while improving TIGTA’s ability to 

support core audit and investigative activities. As part of a TIGTA data center, IT 

provides extensive data analysis services in direct support of audit and investigative 

activities. For example, these services permit TIGTA to meet its responsibilities under 

TIGTA - 26 
the Taxpayer Browsing Protection Act of 1997. Specifically, the services are designed to 

analyze large volumes of data so that potential UNAX violations may be identified. 

Information Security Services: IT provides Federal Information Security Management 

Act (FISMA) support services to TIGTA. This support comes in three areas. The first 

support area is Information Integrity. IT provides guidance on security controls and 

processes to help maintain the confidentiality, availability, and accuracy of its business 

information. The second support area is Insurance and Assurance which addresses 

information risk management. This area provides TIGTA with information on the risk 

factors it is facing with its information systems. This helps TIGTA in making decisions 

on accepting, avoiding, or mitigating assessed risks around its information systems. The 

third support area is Regulatory Compliance. IT provides TIGTA support in interpreting 

guidance from regulatory sources and reporting TIGTA’s compliance in meeting FISMA 

requirements. 

Enterprise Architecture: TIGTA operates several programs to comply with various 

legislative mandates and to improve the reliability, availability, and effectiveness of its 

information technology. TIGTA’s enterprise architecture initiative responds to the 

Clinger-Cohen Act’s requirement to align business practices with technology needs. By 

doing so, enterprise architecture will provide for better decision-making ability on 

information technology investment and related resource allocation decisions. 

Identity Management: To support future authentication demands of those applications, 

TIGTA intends to manage the TIGTA aspect of identity management in concert with the 

IRS, the Department and the federal government. 

Enterprise Content Management: TIGTA continues to use Microsoft SharePoint as an 

internal content delivery service to our auditors, investigators, and inspection and 

evaluation personnel. There are a number of other applications TIGTA uses that contain 

Enterprise Content Management (ECM) functionality, but the functionality is minor 

compared to the business processes the applications serve. As a result, these investments 

are not included in TIGTA ECM, but remain with their associated IT infrastructure. As 

the Department ECM initiative presents opportunities, TIGTA will evaluate transition to 

those document, record, content and tracking, and workflow management functions. 

Non-Major Investments: IT maintains two internal management information systems 

classified as non-major investments under Capital Planning and Investment Control 

guidelines. The Performance and Results Information System (PARIS) supports 

investigative compliance with the Government Performance and Results Act (GPRA). 

The system facilitates GPRA compliance by collecting data needed to measure 

performance of investigative activities, specifically as it pertains to complaint 

management and investigating cases. The PARIS Property Module (PPM) is a custodial 

accounting system used to support the bureau’s Personal Property Management Program. 

PPM is used to track capitalized and expensed assets used in support of audit and 

investigative activities and to track assets seized during law enforcement actions. 

TIGTA - 27 
TIGTA - 28 

4.2 – Program Evaluation 

Not applicable to TIGTA.