IRS to test data engine

An Internal Revenue Service official brushed aside dire predictions about the agency's systems modernization program today, promising in a speech to push the agency's $8 billion program past a critical hump in 2004.

Richard Skorny, the deputy associate commissioner for program management at the IRS, said that first-phase testing of the most critical portion of the modernization program, is done and "essentially good to go," with a caveat. That critical portion is a complex web of accounting and enforcement rules known as the Customer Account Data Engine.

The successful tests were done with data from the 2002 tax year, Skorny said; the rules must now be recoded to reflect changes in laws and regulations since 2002, and then the same tests must be repeated. But looking ahead to what he said would be a watershed event, Skorny predicted that this latest round of testing will be successfully completed in 2004.

The transition to modern financial accounting and data warehouse systems has been fraught with past failures, Skorny acknowledged. But in his speech to information technology officials and business executives, Skorny chose to describe the state of the IRS modernization program as "a glass half full."

The IRS, he said, has completed 10 new electronic-filing service offerings, including a basic taxpayer registration system, for which he provided a live demonstration.

Before conducting any business online with the IRS, Skorny said, the agency will require all tax preparers to register with the IRS, a process to ensure that the agency knows the tax preparer is the person whom he or she claims to be. Each person who wants to register to do business online with the IRS will be mailed a password, which the person would then use to complete the online registration.

Another e-government service that Skorny also demonstrated lets tax practitioners use the Internet to apply for practitioner tax identification numbers online.