Taxpayer Information: Data Sharing and Analysis May Enhance Tax Compliance and Improve Immigration Eligibility Decisions
Highlights
Data sharing can be a valuable tool for federal agencies. The Internal Revenue Service (IRS) can use data from taxpayers and third parties to better ensure taxpayers meet their obligations. Likewise, Congress has authorized certain agencies access to taxpayer information collected by IRS to better determine eligibility for benefit programs. GAO determined (1) the extent to which the IRS and Citizenship and Immigration Services (CIS) within the Department of Homeland Security share and verify data and (2) the benefits and challenges, if any, of increasing such activities. GAO also studied IRS's Offshore Voluntary Compliance Initiative (OVCI) to provide information on (1) the characteristics of the taxpayers who came forward under OVCI and (2) how those taxpayers became noncompliant.
Recommendations
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Internal Revenue Service | The Secretary of Homeland Security and the Commissioner of Internal Revenue should assess the benefits that may be obtained and the costs that may be incurred to share information to enhance tax compliance and improve immigration eligibility decisions. |
Closed – Not Implemented
In IRS's 60 day letter dated November 2, 2004 and USCIS's 60 day letters dated November 24, 2007, both agencies agreed data sharing between the agencies may be beneficial. USCIS and IRS formed a working group to conduct a pilot to test data sharing for businesses that sponsor immigrant workers. Both agencies collaborated on the design and agreed to implement a pilot. During 2007, USCIS accepted full responsibility from IRS for implementing the pilot and preparing a summary report to Congress. As agreed, IRS reported being ready to process tax transcripts for businesses covered by pilot program. As of November 2008, USCIS had not established a date to begin the pilot. Because USCIS has decided not to go forward with the data sharing pilot, this recommendation is moot and closed without implementation.
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| Directorate of Border and Transportation Security | The Secretary of Homeland Security and the Commissioner of Internal Revenue should assess the benefits that may be obtained and the costs that may be incurred to share information to enhance tax compliance and improve immigration eligibility decisions. |
Closed – Not Implemented
In September 2009, the U.S. Citizenship and Immigration Services announced it had abandoned any work on data sharing between the USCIS and the Internal Revenue Service to enhance tax compliance and improve immigration eligibility decisions. The USCIS cited management concerns and public relations issues.
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