2008 budget would boost IRS modernization by $85M

The Bush administration is seeking $282 million to modernize the Internal Revenue Service in his fiscal 2008 proposed budget, an $85 million increase over the fiscal 2007 request.

Modernization is one piece of a three-part strategy for closing the gap between taxes owed and taxes paid. Congressional leaders have discussed how to bring in the taxes owed. Through modernization, the Treasury Department intends to emphasize the other two parts: better taxpayer services and enforcement to eliminate the gap, according to the budget proposal, which was released today.

In 2008, the IRS Business Systems Modernization efforts will continue to focus on important administration systems such as the Customer Account Data Engine and Modernized e-File. CADE's expansion will allow the IRS to process about 50 million tax returns on modernized systems. The IRS also plans to invest in user portals, which support these systems, the budget states.

“The IRS will invest in technology, process improvements and training to achieve consistent, repeatable quality service with reduced costs,” the proposal states.

Droves of taxpayers have gone to the Internet to file or get information on their tax returns because of technological advancements, the proposal states. As many as 1.3 billion people viewed IRS.gov’s Web pages, and 24.7 million people checked their refund status on the “Where’s My Refund?” page.

Before the IRS can spend the funds, however, agency officials must submit to the House and Senate appropriations committees a spending plan preapproved by Treasury and the Office of Management and Budget. It must also conform to the IRS’ enterprise architecture, the budget states.

Treasury’s overall appropriations request for fiscal 2008 is $12.1 billion, a 4.7 percent increase over the administration’s fiscal 2007 request of $11.6 billion.