From the U.S. Government Accountability Office, www.gao.gov Transcript for: 2015 Tax Filing Season Description: Audio interview by GAO staff with James McTigue, Director, Strategic Issues Related GAO Work: GAO-16-151: 2015 Tax Filing Season: Deteriorating Taxpayer Service Underscores Need for a Comprehensive Strategy and Process Efficiencies Released: January 2016 [ Background Music ] [ Narrator: ] Welcome to GAO's Watchdog Report, your source for news and information from the U.S. Government Accountability Office. It's January 2016. Every year, the Internal Revenue Service processes hundreds of millions of tax returns and issues billions of dollars in refunds. The IRS also offers assistance to taxpayers through every step of the process. A group led by Jay McTigue, a director in GAO's Strategic Issues team recently reviewed IRS's performance in the 2015 tax filing season. GAO's Melanie Fallow sat down with Jay to talk about what they found. [ Melanie Fallow: ] Your report seems to really focus on the taxpayer service part of IRS's filing season work. Can you talk a little about what you found there? [ Jay McTigue: ] Taxpayer service, or providing taxpayers with the help they need while trying to fill out their tax returns, is critically important to a successful tax filing season. This past year, although IRS processed nearly 150 million tax returns smoothly, taxpayers needing assistance had a much different experience. For example, fewer than 4 out of 10 taxpayers calling IRS with a question was able to speak with a live customer service representative. This is the lowest level of service in many years and often required wait times of up to a half hour. Overall, more than 56 million calls were abandoned, dropped, or met with a busy signal. On the written correspondence front, taxpayers also received poor service. About half the time, taxpayers, for example, did not receive a response in 45 days and often these responses contained errors. This level of service clearly is unacceptable. The IRS is moving toward providing more services online and leveraging technology. One of their most popular services, Get Transcript, was hacked this past year requiring IRS to take it off-line. [ Melanie Fallow: ] So what factors led to these declines in taxpayer service? [ Jay McTigue: ] The decline in services coincided with a 10% reduction in IRS's budget over the past 5 years as well as decisions by IRS as to how to allocate a limited budget. For example, in order to meet new statutory responsibilities such as implementing the Affordable Care Act as well as combating challenges such as identity theft refund fraud. For taxpayers needing assistance, what this means is that there are now about 2,600 fewer IRS employees providing assistance while the number of individual tax returns filed has increased by about 8 million since 2010. In addition, IRS has had to dedicate about 3,000 employees to combat identity theft refund fraud. This effort has been successful in stopping millions of fake tax returns and saved the Treasury billions of dollars but this takes time and IRS staff away from providing other taxpayer services. [ Melanie Fallow: ] So what is GAO recommending to address these service issues? [ Jay McTigue: ] Well, in light of IRSs reduced budget and expanding responsibilities, we have reported for several years that IRS needs to rethink its approach to customer service. While IRS has taken some steps to improve service as I've discussed, we are concerned that more needs to be done and are recommending that Congress should consider requiring the Secretary of the Treasury, working with the IRS Commissioner, to develop a comprehensive customer service strategy. We also made recommendations to Treasury to revise its performance plan to include goals for correspondence timeliness and for IRS to take steps to reduce errors in the letters it sends to taxpayers. [ Melanie Fallow: ] Finally, for taxpayers, what would you say is the bottom line of this report? [Jay McTigue:] The bottom line, Melanie, is that taxpayer service during the 2015 filing season was bad and, frankly, we don't see it improving much during the upcoming year. Whenever possible, I suggest that taxpayers look for solutions by visiting www.irs.gov. If they can't find the answer online then I suggest they try to remain patient. There will continue to be difficulties and long waits reaching IRS by phone. Writing to the IRS is always an option, but I wouldn't recommend that if a, you know, quick response is required. [ Background Music ] [ Narrator: ] To learn more, visit GAO.gov and be sure to tune in to the next episode of GAO's Watchdog Report for more from the congressional watchdog, the U.S. Government Accountability Office.