Use of Minicomputers for Internal Revenue Service Tax Return Preparation

Concern over the difficulties that average taxpayers encounter in completing their income tax returns, as well as a continuing interest in improving productivity and effective resource utilization, led the Internal Revenue Service (IRS) to test the use of minicomputers to fully prepare some taxpayer returns. The tests established that the use of minicomputers is reliable, practical, and popular with the taxpayers, IRS, and the news media. While demonstrating that minicomputer return preparation is feasible, the tests did not evaluate some important effects that minicomputer preparation would have on costs and benefits; for example, the tests did not estimate the costs or benefits of implementing a nationwide, large-scale, and long-range program. IRS should establish conditions and circumstances under which individual tax returns will be prepared, including some of the following policy considerations: the type of returns that IRS will prepare, the maximum level of adjusted gross income to qualify for the program, other possible program restrictions, the degree and type of publicity needed, and ways to deliver the service to the public.