Internal Revenue Service: Assessment of the Fiscal Year 2009 Budget Request
Published: 2008-04-16T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The fiscal year 2009 budget request for the Internal Revenue Service (IRS) is a road map for how IRS plans to allocate resources and achieve ambitious goals for improving enforcement, improving taxpayer service, increasing research, and continuing to invest in modernized information systems. One complicating factor in implementing IRS's plans in the immediate future is the recent passage of the Economic Stimulus Act of 2008, which creates additional, unanticipated workload for IRS. GAO was asked to (1) assess how the President's budget request for IRS allocates resources and justifies proposed initiatives; (2) determine the status of IRS's efforts to develop and implement its Business Systems Modernization (BSM) program; and (3) determine the total costs of administering the economic stimulus legislation. To meet these objectives, GAO drew upon and updated recently issued reports.
section_title: What GAO Found
paragraphs: The President's fiscal year 2009 budget request for IRS is $11.4 billion, 4.3 percent more than last year's enacted amount. The request proposes to maintain taxpayer service at recent levels, in part by realizing efficiency gains from electronic filing, despite a decrease in staffing. It also proposes a 7 percent increase in enforcement spending, including spending for 21 legislative and nonlegislative initiatives. The legislative proposals are projected to cost $23 million in fiscal year 2009, funding that IRS would not need if the proposals are not enacted. Similarly, if IRS were to fall behind in its proposed enforcement hiring efforts, it would not need all $226 million of the associated funding. IRS justified its nonlegislative enforcement initiatives with return on investment (ROI) analyses, which are useful, despite limitations, for making resource allocation decisions. The budget request does not provide ROI information for activities that constitute a large part of the budget request--activities other than the proposed initiatives. The request for BSM is over $44 million lower than the fiscal year 2008 enacted amount. IRS said this funding level will allow it to continue its primary modernization projects, but it did not describe how specific projects or benefits to taxpayers would be affected. IRS has continued to make progress in implementing BSM projects and improving modernization management controls and capabilities. However, further improvements are needed. For example, the agency has yet to develop long-term plans for completing BSM and consolidating and retiring legacy systems. IRS estimated that the costs of implementing the economic stimulus legislation may be up to a total of $767 million--including a $202 million supplemental appropriation. In addition to the supplemental appropriation, IRS is reallocating hundreds of collections staff to answering taxpayer telephone calls, resulting in up to $565 million in foregone enforcement revenue. In addition, IRS expects some deterioration in telephone service because of the increased call volume. For example, IRS is expecting its assistor level of service to drop to as low as 74 percent compared to its goal of 82 percent.

section_title: Letter
paragraphs: We appreciate this opportunity to comment on the President’s fiscal year  (FY) 2009 budget request for the Internal Revenue Service (IRS).
Financing of the federal government depends largely on IRS’s ability to  effectively administer the tax laws. The President has requested $11.4  billion in program dollars to fund IRS’s FY 2009 operations, including $11.1  billion for service to taxpayers and tax law enforcement, plus $223 million  for the Business Systems Modernization (BSM) program, IRS’s ongoing  effort to improve the agency’s business and tax processing systems.
The FY 2009 budget request is a road map for how IRS intends to allocate  resources in order to carry out ambitious plans of improving enforcement,  improving taxpayer service, increasing research, and continuing to invest  in modernized information systems. Together with the budget request,  IRS’s recently published strategies spell out its intentions for improving  taxpayer service and reducing the net tax gap—the difference between the  taxes owed and eventually paid, most recently estimated at $290 billion for  tax year 2001. The budget request and strategies aim to build on recent  IRS accomplishments such as annually bringing in more revenue through  enforcement and making progress on modernizing IRS’s business and tax  processing systems. One complicating factor for carrying out IRS’s  ambitious plans in the immediate future is the recent passage of the  Economic Stimulus Act of 2008, which creates additional, unanticipated  workload for IRS this year. Passage of this act required IRS to act quickly  to deal with taxpayers’ questions and begin issuing payments.
Based on your request, our objectives were to (1) assess how the  President’s budget request for IRS for FY 2009 allocates resources for  enforcement, service, research, and systems modernization primarily  compared to FY 2008 enacted levels; (2) assess the rationales for  differences between the 2 years, including the rationales for initiatives and  the extent to which those rationales have been justified; (3) determine the  status of IRS’s efforts to develop and implement its BSM program; and (4)  determine the total cost of administering the economic stimulus program.
To meet these objectives, we drew upon and updated a recently issued  report on the budget request and IRS’s 2008 tax filing season, and for our  BSM work, we relied primarily on our review of the FY 2008 BSM  expenditure plan. For the first report, we compared enacted and  requested budgets for IRS; reviewed documents, including estimates of  revenues and costs from initiatives; and interviewed IRS officials. For our  BSM report, we analyzed the expenditure plan, reviewed other documents,  and interviewed IRS officials. In assessing the cost of the economic  stimulus package, we obtained performance and production data, looking  for factors that significantly affected performance, and we interviewed IRS  officials. We conducted the current performance audit from March 2008  through April 2008 in accordance with generally accepted government  auditing standards. Those standards require that we plan and perform the  audit to obtain sufficient, appropriate evidence to provide a reasonable  basis for our findings and conclusions based on our audit objectives. We  believe that the evidence obtained provides a reasonable basis for our  findings and conclusions based on our audit objectives. For a more  detailed discussion of our scope and methodology, see the appropriate  sections in the budget and filing season and the BSM reports.
In summary, we make the following major points:    The President’s budget request for IRS proposes to maintain taxpayer  service at recent levels and increase enforcement. Overall, it increases  spending on IRS by 4.3 percent. Spending on taxpayer service would  increase by less than 1 percent, which would result in reduced staffing,  but the level of taxpayer service would be maintained by realizing  efficiency gains, in part, through increases in electronic filing. The  budget proposes a 7 percent increase in enforcement spending,  including funds and staffing for various legislative and nonlegislative  initiatives. According to the proposal, the legislative initiatives would  raise about $36 billion in revenue over 10 years. They are projected to  cost $23 million in FY 2009, funding IRS would not need if none of the  legislative initiatives were enacted. Similarly, if IRS were to fall behind  in meeting its challenging hiring goals for the nonlegislative initiatives,  it would not need all $226 million of the associated funding for FY 2009.
IRS included more information than past years on the initiatives in the  FY 2009 proposed budget. Of particular note, IRS included return on  investment (ROI) information for all nonlegislative initiatives.  However, beyond those initiatives, the budget request does not provide  an analytic basis for key resource allocation decisions. Such decisions  include allocating resources among a variety of enforcement programs  and taxpayer services. Analytic data such as ROI can be helpful to IRS’s  management and the Congress for making these decisions as well as  decisions about the overall balance between taxpayer service and  enforcement. Although the budget request provides performance  measure data, it does not provide ROI for programs or activities that  constitute a large part of the budget request—activities other than the  proposed initiatives.
The requested budget for BSM is over $44 million lower than the FY  2008 enacted amount of about $267 million and roughly $185 million  less than the amount the IRS Oversight Board is proposing. Modernized  e-File (MeF) is the project with the largest difference between the  requested budget and the FY 2008 enacted amount. IRS stated that the  requested BSM funding level will allow it to continue developing and  delivering its primary modernization projects but did not provide  details on how plans to deliver specific projects or benefits to  taxpayers would be affected. IRS continues to make progress in  implementing BSM projects and meeting cost and schedule  commitments for most deliverables, but three project milestones  recently experienced significant cost or schedule delays. IRS has also  taken steps to address our prior recommendations; however, work  remains to fully implement them, including developing long-term plans  for completing the BSM program. Future releases of the Customer  Account Data Engine (CADE) and Account Management Services  (AMS) continue to face risks and challenges, which IRS is working to  mitigate. Finally, we recently recommended that IRS complete a plan  with specific time frames for implementing initiatives supporting its  information technology (IT) human capital strategy, and IRS agreed.
IRS estimates that the cost of implementing the economic stimulus  legislation may be up to a total of $767 million, including a $202 million  supplemental appropriation. In addition to the supplemental  appropriation, IRS is reallocating resources from enforcement to  taxpayer service by shifting hundreds of collections staff to answering  telephone calls and, as a result, may forego up to $565 million in  enforcement revenue. IRS has experienced a deterioration of telephone  access and expects a further decline. For example, IRS’s assistor level  of service—which measures a taxpayer’s ability to get through and  speak to an assistor—has already declined, and IRS expects access to  continue to drop to as low as 74 percent, down from the FY 2008 goal  of 82 percent.
subsections: section_title: The FY 2009 Budget Request Proposes to Maintain Taxpayer Service at Recent Levels and Increase Enforcement
paragraphs: The President’s budget request is proposing to maintain taxpayer service  levels with fewer staff by realizing efficiency gains; it also proposes to  increase enforcement by adding staff. The President’s FY 2009 budget  request of $11.4 billion for IRS is 4.3 percent more than the FY 2008  enacted budget and represents an increase of less than 1 percent for  taxpayer service and 7 percent for enforcement, as shown in table 1.
The budget request increases IRS-wide staff levels, measured in full-time  equivalents (FTEs), by 2 percent, with a 1.4 percent decrease in taxpayer  service FTEs and a 5.2 percent increase in enforcement FTEs, as shown in  table 2.
The President’s budget proposal is consistent with longer-term trends for  IRS. Compared to actual spending in FY 2006, the proposed FY 2009  budget increases taxpayer service funding by 3.7 percent, a real decrease  after inflation, while increasing IRS’s enforcement funding by 10 percent.
The budget request proposes to maintain taxpayer service at recent levels.  As an example, the key taxpayer service measures shown in table 3 are  projected to remain relatively stable through FY 2009.
In order to maintain taxpayer service at recent levels despite a decrease in  real spending and staffing, IRS expects to realize efficiency gains. For  instance, IRS expects to devote 207 fewer FTEs to the labor-intensive  processing of paper returns because of expected increases in electronic  filing. These expected efficiency gains are consistent with past trends— between 1999 and 2007, IRS reduced staff devoted to processing paper  returns by about 1,800 FTEs.
IRS’s ability to maintain or improve taxpayer service beyond 2009 will  likely depend on its ability to continue to improve efficiency. To this end,  in recent reports, we made recommendations to further increase  electronic filing. We recommended that IRS determine the actions needed  to require software vendors to include bar codes on printed returns, and  we suggested that the Congress mandate electronic filing by certain paid  tax preparers. IRS agreed with our bar code recommendation and  outlined the actions it would take.
Some of the real spending decrease proposed for FY 2009 is because of  one-time investments made in FY 2008 or carryovers in funds from FY  2008. For instance, the budget request proposes a $31 million reduction in  funding for taxpayer assistance centers and outreach. However, IRS  officials told us that this reduction includes funding used for long-term  investments in FY 2008 that would not need to be duplicated in FY 2009.  IRS officials also told us that a $7.7 million decrease in funding for the  Taxpayer Advocate offsets a funding increase in FY 2008 that is being used  to lower the Advocate’s outstanding caseload. Finally, an $8 million  reduction in the Volunteer Income Tax Assistance (VITA) program reflects  FY 2008 funding that was not spent and carried over into FY 2009.
The budget request for IRS’s enforcement programs includes  nonlegislative and legislative initiatives. According to the proposal, the five  nonlegislative enforcement initiatives would cost about $338 million in FY  2009 and are expected to raise about $2 billion of direct revenue annually  starting in FY 2011. In addition, the budget request estimates that the  enforcement initiatives would generate at least another $6 billion annually  in indirect revenue. The indirect revenue results from improved voluntary  compliance induced by taxpayers’ awareness of expanded IRS  enforcement. The budget request also proposes increases in examination  coverage for corporations with assets of $10 million or more from a  planned 6.6 percent for FY 2008 to 6.8 percent for FY 2009. The coverage  rate would increase to 7.6 percent in FY 2010 as new enforcement staff  hired in FY 2009 complete training and can audit more returns.
The budget request includes 16 legislative initiatives budgeted at $23  million for FY 2009 that it says would raise about $36 billion in revenue  over 10 years; if none were enacted, IRS would not need the $23 million.  We have reported on three of the proposals. In 2006, we suggested that the  Congress consider an idea for reducing securities capital gains  noncompliance. In 1991, we supported the notion that payments to  corporations be reported on information returns. Finally, in 2007, we  described ways to mitigate the compliance costs related to these  information returns and to other information returns associated with  credit and debit card payments.
The revenue expected from IRS’s enforcement initiatives is modest  compared to the net tax gap, which was last estimated at $290 billion for  tax year 2001. As we noted in our statement to this Committee last year, no  single approach, such as IRS enforcement, is likely to fully and effectively  address noncompliance. Multiple approaches are needed because  noncompliance has multiple causes and spans different types of taxes and  taxpayers.
Hiring needed staff for the nonlegislative initiatives will be challenging for  IRS’s Large and Mid-Size Business (LMSB) and Small Business/Self- Employed (SB/SE) divisions. For instance, the initiatives call for adding  1,431 revenue agents in addition to those who must be replaced from  attrition, a high number relative to past years. IRS divisions have  previously hired large numbers of staff in a short time because of specific  budget initiatives, but officials reported that hiring gradually over time  would reduce challenges. If IRS were to fall behind in its hiring efforts, it  would not need all $226 million of the funding for staff for FY 2009  initiatives.
section_title: IRS Has Enhanced Its Justifications for Initiatives and Could Benefit from Using ROI Analyses More Broadly, Even with Their Limitations
paragraphs: Responding to our recommendations from last year, IRS included more  information on initiatives in the FY 2009 proposed budget, including ROI  information for all nonlegislative initiatives. Last year, we recommended  that IRS have available basic descriptive, cost, and expected performance  information on all new initiatives and include such information in future  budget submissions. This year, the budget request has sections explicitly  entitled, for instance, “Initiative Summary,” “Implementation Plan,”  “Expected Benefits,” and “ROI.” Four of the five nonlegislative  enforcement initiatives for FY 2009 were revisions of FY 2008 initiatives,  but with more total funds requested and generally more informative  justifications than for FY 2008.
However, IRS’s ROI calculations have limitations that reflect the  challenges of estimating ROIs. For example, the calculations do not  account for benefits that are harder to measure, such as improved  voluntary compliance. Another example showing ROI limitations is the $51  million National Research Project (NRP) initiative for which IRS estimates  the ROI to be $0.40 per $1.00 invested. NRP funds research audits in order  to develop more effective enforcement programs. The ROI calculation only  includes direct revenue resulting from the research audits, not the  potential for increased revenue from improved enforcement programs; nor  does the calculation include the benefits of the Department of the  Treasury’s use of NRP data to provide the basis for legislative  recommendations.
Although the budget request for IRS provides performance measure data,  it does not provide ROI analyses for programs or activities other than the  new initiatives. As we noted in our recent report, analytic data such as ROI  can be helpful to managers and the Congress when making resource  allocation decisions. ROI analyses, even with their limitations, can help  answer questions such as the following:    What are the implications for IRS’s resource allocation of the lower  costs per taxpayer contact for some services compared to others as  shown in table 4?
Are there extra benefits that offset the higher costs of some services, or  could costs be reduced by promoting increased reliance on the lower- cost options?
Similar questions can be asked about enforcement based on table 5:  Is IRS appropriately allocating resources between field audits, often  conducted at a taxpayer’s business, and correspondence audits, which  are simpler and conducted by mail?
For the rows in table 5 with average recommended additional tax per  return greater for correspondence audits than for field audits, could  resources be reallocated from field audits to correspondence audits in  order to help close the tax gap?
Are there other benefits to field audits, such as a greater impact on  voluntary compliance, that are not captured in IRS’s data?
We recognize that developing ROI estimates for IRS’s ongoing programs  such as examinations and taxpayer service will be a challenge. However,  because of the potential benefits of ROI analyses, we recommended in our  previous report on the FY 2009 budget request that the Commissioner of  Internal Revenue extend the use of ROI in future budget proposals to  cover major enforcement programs. At that time, IRS officials said that  because of the short time frame for our report, they did not have time to  fully analyze its recommendations, and, therefore, were unable to  respond. We have agreed to meet with IRS to further discuss the ROI  recommendation.
section_title: Further Progress Made in Implementing BSM, but Challenges and Risks Remain
paragraphs: IRS’s BSM program, initiated in 1999, involves the development and  delivery of a number of modernized tax administration, internal  management, and core infrastructure projects that are intended to provide  improved and expanded service to taxpayers as well as IRS internal  business efficiencies. Key tax administration projects include CADE,  which is intended to provide the modernized database foundation to  replace the existing Individual Master File processing system that contains  the repository of individual taxpayer information; AMS, which is intended  to enhance CADE by providing applications for IRS employees and  taxpayers to access, validate, and update accounts on demand; and MeF,  which is to provide a single standard for filing electronic tax returns. We  recently reported that while IRS has continued to make progress in  implementing BSM projects and improving modernization management  controls and capabilities, challenges and risks remain, and further  improvements are needed.
As shown in table 6, the FY 2009 budget request for the BSM program is  less than the enacted FY 2008 budget by over $44 million and about $185  million less than the amount the IRS Oversight Board is proposing. When  we asked about the impact of this reduction on its operations, IRS told us  that the proposed funding level will allow it to continue developing and  delivering its primary modernization projects but did not provide details  on how plans to deliver specific projects or benefits to taxpayers would be  affected. MeF is the project with the largest difference between the  requested budget and the FY 2008 enacted amount.
IRS has made progress in implementing BSM projects and meeting cost  and schedule commitments for most deliverables, but three project  milestones experienced significant cost or schedule delays. During 2007,  IRS completed milestones of the Filing and Payment Compliance (F&PC),  a tax collection case analysis support system; MeF; CADE; and AMS. Our  analysis of reported project costs and completion dates showed that 13 of  the 14 associated project milestones that were scheduled for completion  during this time were completed within 10 percent of cost estimates, and  11 of the 14 milestones were completed within 10 percent of schedule  estimates. However, a milestone for CADE exceeded its planned schedule  by 66 percent and experienced a 15 percent cost increase; another  milestone for the same project incurred a 153 percent schedule delay, and  a milestone for MeF experienced a 41 percent schedule delay (see fig. 1).
IRS has taken steps to address our prior recommendations to improve its  modernization management controls and capabilities. However, work  remains to fully implement them. For example, in July 2005, we  recommended that IRS fully revisit the vision and strategy for the BSM  program and develop a new set of long-term goals, strategies, and plans  consistent with the budgetary outlook and IRS’s management  capabilities. We also noted that the vision and strategy should include  time frames for consolidating and retiring legacy systems. In response, IRS  has developed a Modernization Vision and Strategy framework and  supporting 5-year Enterprise Transition Plan. However, the agency has yet  to develop long-term plans for completing BSM and consolidating and  retiring legacy systems. We also recommended in February 2007 that IRS  ensure that future BSM expenditure plans include a quantitative measure  of progress in meeting scope expectations. We further recommended  that, in developing this measure, IRS consider using earned value  management since this is a proven technique required by the Office of  Management and Budget for measuring cost, schedule, and functional  performance against plans. While IRS has developed an approach to  address our recommendation, it has not yet fully implemented it.
Future BSM project releases continue to face significant risks and issues,  which IRS is addressing. Specifically, the agency recently identified  significant risks and issues with planned system deliveries of CADE and  AMS and reported that maintaining alignment between the two systems  will be a significant challenge and source of risk for the BSM program. IRS  recognizes the potential impact of identified risks and issues on its ability  to deliver projects within cost and schedule estimates and has developed  mitigation strategies to address them. While mitigation strategies have  been developed, the risks and challenges confronting future releases of  CADE and AMS are nevertheless significant, and we will continue to  monitor them and actions to address them.
IRS also made further progress in addressing high-priority BSM program  improvement initiatives during the past year. In September 2007, IRS  completed another cycle of initiatives and initiated a new cycle, which was  scheduled to be completed at the end of March 2008. Initiatives that were  addressed in the 6-month cycle ending in September 2007 included IT  human capital, information security, and process improvements (e.g.,  developing and implementing standardized earned value management  practices for major projects). IRS’s program improvement process  continues to be an effective means of regularly assessing, prioritizing, and  incrementally addressing BSM issues and challenges. However, more work  remains for the agency to fully address these issues and challenges.
Finally, we recently reported that efforts to address human capital  challenges continue, but more work remains. IRS developed an IT human  capital strategy that addresses hiring critical personnel, employee training,  leadership development, and workforce retention, and agency officials  stated that they plan to undertake a number of human capital initiatives to  support their human capital strategy, including conducting analyses of  turnover rates and continuing efforts to replace key leaders lost to  retirement. However, a specific plan with time frames for implementing  these initiatives has not been developed. We recommended that IRS  complete such a plan to help guide the agency’s efforts in addressing its IT  human capital gaps and measure progress in implementing them. IRS  agreed with our recommendation and stated that it intends to develop a  plan to implement its IT human capital strategy.
section_title: IRS Estimates the Cost of Implementing the Economic Stimulus Legislation May Be Up to a Total of $767 Million and Expects Declines in Some Taxpayer Services
paragraphs: The Economic Stimulus Act of 2008 is resulting in a significant workload  increase not anticipated in the FY 2008 budget. As part of the legislation,  IRS received $202 million in a supplemental appropriation. However,  because IRS could not find an alternative according to responsible  officials, it has reallocated resources from enforcement to taxpayer  service and is allowing some deterioration in telephone service.
IRS will begin sending economic stimulus payments to more than 130  million households in early May, after the current tax filing season, and is  scheduled to be done by mid-July. These include an estimated 20 million  retirees and disabled veterans, and low-wage workers who usually are  exempt from filing a tax return but will be eligible for stimulus payments.  Taxpayers required to file a tax return must do so by April 15 in order to  receive a stimulus payment by mid-July. People who are not required to  file a tax return, but are doing so to receive a stimulus payment, are  required to file an IRS Form 1040A by October 15, 2008.
As part of the legislation, IRS received a supplemental appropriation of  $202 million to help fund its costs for implementing the stimulus package.  This funding will remain available until September 30, 2009. As shown in  table 7, IRS plans to spend the bulk of the funding—$151.4 million—for  Operations Support, most of it on postage for two mass mailings and on IT  support. IRS also expects to spend $50.7 million for Taxpayer Services,  including $26.2 million for staffing and overtime for telephone assistors.  IRS is expecting 2.4 million additional telephone calls in March and April  with questions for IRS assistors about the economic stimulus legislation.  These calls are in addition to the more than 14 million calls typically  answered by IRS assistors between January and mid-April.
To help meet the increased telephone demand, IRS is shifting about half of  its over 2,000 Automated Collection System (ACS) telephone staff from  collecting delinquent taxes to answering economic stimulus telephone  calls from March through May. To accommodate this shift, IRS stopped  sending out some ACS-generated notices, such as notices of levy, several  weeks ago. According to IRS officials, it takes about 3 to 4 weeks before  this adjustment in ACS-generated notices affects the ACS workload. IRS  originally estimated that the revenue foregone by shifting ACS staff to be  up to $681 million. However, according to IRS officials, in early April, IRS  revised its foregone revenue estimate down to $565 million, shown in table  7, largely because of lower-than-expected demand for telephone  assistance in March.
According to IRS officials, IRS’s priority is to respond to taxpayers’  questions about the stimulus program; therefore, the officials are  monitoring call volume and adjusting the number of ACS staff answering  telephones accordingly. When call volume is low, ACS staff work on  outstanding ACS collection cases. However, IRS officials stated that this  work does not produce the same revenue as the ACS-generated notices,  particularly revenue generated from notices of levy. When IRS adjusts the  volume of ACS-generated notices, it takes several weeks before that  adjustment affects ACS workload. IRS officials do not want to resume  sending ACS-generated notices until they are sure ACS staffers are  available to handle the resulting workload.
Should the lower-than-expected call volume continue, IRS may have an  opportunity to shift the ACS staff back to their most productive collection  work. This could further reduce the revenue foregone from using ACS  staff to answer stimulus-related telephone calls. To date, IRS has not  reduced its projections for future stimulus-related call volume. If the  projections are reduced, IRS may be able to resume sending out at least  some ACS-generated notices.
According to IRS officials, IRS considered alternatives to shifting ACS  staff, including contracting out, using other IRS staff, or using Social  Security Administration or other federal staff, but decided the alternatives  were not feasible. For example, contracting out was not deemed feasible  because of insufficient time to negotiate the contract and conduct  background checks and training.
Another cost—although not measured in dollars—is the decline in  telephone service shown in table 7. Because of the increased call volume,  IRS expects its assistor level of service to drop from 82 percent (the 2008  goal) to as low as 74 percent—the lowest level since 2002. IRS is already  experiencing some declines in telephone service. As of March 29, the level  of service had dropped to 80 percent, taxpayers were waiting a minute and  a half longer than last year, and they were hanging up 43 percent more  often while waiting to speak to an assistor. Between March 3 and March  29, IRS assistors answered over 572,000 stimulus-related calls. IRS  expects call volume to increase rapidly in upcoming weeks as taxpayers  receive their stimulus notices in the mail.
Because IRS is in the early stages of implementing the stimulus legislation,  IRS officials do not have much information about the actual costs.  Through March, IRS estimates that it has spent almost $103 million, mostly  for postage.
section_title: Agency Comments
paragraphs: In commenting on a draft of our earlier report on the FY 2009 budget  request and 2008 tax filing season, IRS officials said that, because of the  short time frame for our report, they did not have time to fully analyze our  recommendation and, therefore, were unable to respond at the time. They  provided technical comments at that time and again for this statement, and  we made those changes where appropriate. We have agreed to meet with  IRS to further discuss the ROI recommendation.
Mr. Chairman, this concludes my prepared statement. Mr. Powner and I  would be happy to respond to questions that you or other Members of the  Subcommittee may have at this time.
section_title: Contacts and Acknowledgments
paragraphs: For further information regarding this testimony, please contact James R.  White, Director, Strategic Issues, on (202) 512-9110 or whitej@gao.gov or  David A. Powner, Director, Information Technology Management Issues,  on (202) 512-9296 or pownerd@gao.gov. Contact points for our offices of  Congressional Relations and Public Affairs may be found on the last page  of this statement. Individuals making key contributions to this testimony  include Joanna Stamatiades, Assistant Director; Carlos E. Diz; Sarah A.  Farkas; Charles R. Fox; Leon H. Green; Carol M. Henn; Lawrence M. Korb;  Paul B. Middleton; Karen V. O’Conor; Sabine R. Paul; Cheryl M. Peterson;  and Neil A. Pinney.
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