Lawmakers Examine IRS Management

Lawmakers examined a variety of IRS management issues during an October 25 hearing before the House Oversight and Government Reform Subcommittees on Government Operations and Health Care, Benefits and Administrative Rules. Witnesses included officials from the IRS and Treasury Inspector General for Tax Administration (TIGTA).

Two issues that were of particular focus during the hearing were the IRS’s rehiring of formerly dismissed employees for misconduct issues and the IRS contract that had been made in September with Equifax just days after the company’s large-scale date breach was revealed. Democratic lawmakers, however, largely focused on criticizing Congress for budget cuts to the IRS while simultaneously expecting maximum performance. Ranking Government Operations Subcommittee member Gerald E. Connolly, D-Va., called the budget cuts “drastic,” saying that it “severely weakens” the IRS’s ability to protect taxpayers efficiently.

Rehires

“TIGTA found that more than 200 (approximately 10 percent) of the more than 2,000 rehired IRS employees were previously terminated from the IRS or separated while under investigation for a substantiated conduct or performance issue,” Inspector General J. Russell George noted in his testimony. Rep. Mark Sanford, R-S.C., questioned TIGTA and IRS witnesses about four specific IRS employees who were rehired after substantiated unauthorized access to taxpayer records.

George told Sanford that, “in defense of the IRS,” a lot of rehires are temporary hires during the filing season. “They bring in people that have had experience processing returns in the past,” he said. To that end, IRS Deputy Commissioner for Operations Support Jeffrey Tribiano testified that “most of the rehired employees identified in the TIGTA report were seasonal employees who had been hired to support the 2017 filing seasons.” According to Tribiano, corrective actions to IRS hiring procedures will be in place before the 2018 filing season.

However, such a rehiring process is “bad decision making,” according to George. “Whether it is 400 or one; that rehire should not have occurred. We hope the new commissioner will be more proactive in avoiding this in the future,” George told lawmakers.

Equifax

Rep. Jody Hice, R-Ga., asked IRS officials if the Service knew about the major Equifax data breach at the time the contract was drawn up. Tribiano responded, “Yes,” adding, “At that point in time, the systems that housed where we did business were separate from the breach.”

IRS officials told lawmakers that immediately upon hearing of the Equifax data breach, an Incident Response Team was established to ascertain the extent of the breach. On-site inspections of Equifax headquarters revealed that no IRS data was compromised and that services provided to the IRS under the contract were not affected, Tribiano testified. Additionally, on October 12, after receiving new information, the IRS took the” precautionary step of temporarily suspending” the contract. “We took steps to understand and evaluate the impact of the Equifax data breach on IRS systems before we made the decision to enter into the interim contract,” Tribiano noted in his written testimony.

By Jessica Jeane, Wolters Kluwer News Staff

“Ongoing Management Challenges at IRS” —Testimony of J. Russell George, Treasury Inspector General for Tax Administration

Written Testimony of Jeffrey J. Tribiano, Deputy Commissioner for Operations Support, and Silvana Gina Garza, Chief Information Officer

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