Skip to main content

Tax Policy and Administration

Jump To:

Recent Reports

View More Reports

Open Recommendations

Puerto Rico: IRS Should Improve Oversight of Taxpayers Claiming Exemption from Federal Taxes
GAO-26-107225
Dec 12, 2025
Show
3 Open Recommendations
Agency Affected Recommendation Status
Internal Revenue Service The Commissioner of Internal Revenue should establish procedures to regularly obtain from Hacienda current data on all recipients of the Puerto Rico resident investor incentive. These procedures could incorporate GAO's leading collaboration practices. (Recommendation 1)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Internal Revenue Service The Commissioner of Internal Revenue should establish written procedures to review cases of potential noncompliance among recipients of the resident investor incentive that Puerto Rico government agencies identify and send to IRS. (Recommendation 2)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.
Internal Revenue Service The Commissioner of Internal Revenue should take action to promote voluntary compliance, such as sending educational letters explaining key compliance requirements to taxpayers who are benefiting from Puerto Rico's resident investor incentive. (Recommendation 3)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Taxpayer Experience: IRS Should Fully Establish Its Approach for Using Evidence to Assess Service Improvement Results
GAO-25-107408
Jul 17, 2025
Show
1 Open Recommendations
1 Priority
Agency Affected Recommendation Status
Internal Revenue Service
Priority Rec.
We recommend that the Commissioner of Internal Revenue fully establish an evidence-based approach, such as we identified, to determine whether and how improvements to services affect the taxpayer experience. (Recommendation 1)
Open
IRS agreed with this recommendation. In June 2025 comments on our draft report, IRS outlined planned steps for implementation. Until IRS fully establishes an evidence-based approach for the taxpayer experience, IRS will not be assured that it has the information it needs to assess progress toward its taxpayer experience goals, determine what worked well and where improvements are needed, and identify the best investments of its resources to make those improvements. We will continue to monitor progress and update this status as IRS more fully documents its planned actions to implement the recommendation, as we expect later this year.

Direct File: IRS Successfully Piloted Online Tax Filing but Opportunities Exist to Expand Access
GAO-25-106933
Dec 19, 2024
Show
3 Open Recommendations
Agency Affected Recommendation Status
Internal Revenue Service The Commissioner of Internal Revenue should ensure relevant officials collaborate on recruiting and training customer service representatives for Direct File and document an annual process for recruiting and training employees. (Recommendation 1)
Open
IRS agreed with the recommendation. In July 2025, Public Law 119-21 section 70607 provided $15 million for the Department of the Treasury to report to Congress on the cost of establishing and enhancing public-private partnerships to provide free tax filing to replace direct e-file programs run by the IRS. Following this new law, IRS stated in August 2025 that agency efforts to address this recommendation and others related to the Direct File program were contingent upon the program's continuation. In August 2025, we requested information from IRS regarding how officials may have addressed this recommendation during the 2025 tax filing season. As of September 16, 2025, we have not received the requested information.
Internal Revenue Service The Commissioner of Internal Revenue should continue to coordinate with state revenue agencies to expand taxpayer access to Direct File and, as necessary, take steps to ensure the availability of the federal Direct File program to eligible taxpayers in all states. (Recommendation 2)
Open
IRS agreed with the recommendation. In July 2025, Public Law 119-21 section 70607 provided $15 million for the Department of the Treasury to report to Congress on the cost of establishing and enhancing public-private partnerships to provide free tax filing to replace direct e-file programs run by the IRS. Following this new law, IRS stated in August 2025 that agency efforts to address this recommendation and others related to the Direct File program were contingent upon the program's continuation. In August 2025, we requested information from IRS regarding how officials may have addressed this recommendation during the 2025 tax filing season. As of September 16, 2025, we have not received the requested information.
Internal Revenue Service The Commissioner of Internal Revenue should ensure IRS's planned research on potential Direct File users includes research questions that will allow the agency to collect data that can be used to prioritize the development of new capabilities for Direct File. (Recommendation 3)
Open
When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

Tax Administration: IRS Needs to Take Additional Actions to Prepare for New Information Reporting Requirements
GAO-24-107028
Sep 19, 2024
Show
2 Open Recommendations
Agency Affected Recommendation Status
Internal Revenue Service The Commissioner of Internal Revenue should update IRS's policies and procedures to require a documented risk assessment for substantive tax administration decisions and include guidance on when these assessments are needed, such as when a decision could affect a large number of taxpayers or when decisions could generate congressional or oversight scrutiny. (Recommendation 1)
Open
IRS agreed with this recommendation and, as of June 2025, reported that its Enterprise Risk Management will update its policies and procedures to require a documented risk assessment for substantive tax administration decisions and include guidance on when these assessments are needed by September 2025. Assessing risks and documenting key decisions would help promote accountability and transparency to ensure IRS has a sound rationale for its implementation decisions.
Internal Revenue Service The Commissioner of Internal Revenue should ensure offices implementing the lowered Form 1099-K reporting threshold develop and implement a process to comprehensively and systematically document stakeholder feedback. (Recommendation 2)
Open
IRS agreed with this recommendation and, as of June 2025, reported the agency would develop a process to document stakeholder feedback and communicate updated Form 1099-K guidance to appropriate parties by July 2026. IRS reported that it was researching internal systems and plans to leverage existing technology to decrease implementation time and costs. Having a process that comprehensively and systematically tracks stakeholder feedback, such as a designated place for such feedback, will help IRS ensure it is prepared and well positioned to implement changes to the Internal Revenue Code and make tax administration decisions.
Internal Revenue Service The Commissioner of Internal Revenue should ensure the Communication and Liaison Office and the Office of Digital Asset Initiative update their Communication Strategy to include periodic evaluation of their outreach and education efforts to assess whether they are meeting the agency's goals and providing timely, understandable, readily available, and accessible information to tax professionals, industry, and taxpayers. (Recommendation 4)
Open – Partially Addressed
IRS agreed with the recommendation and as of March 2025 reported that the agency is building mechanisms to gather feedback and measure the effectiveness of outreach activities. In June 2025, IRS provided us an updated Digital Asset Communication plan that includes draft management strategies to measure success of the agency's communication efforts and help them make data-drive decisions. By October 2025, IRS plans to leverage existing stakeholder networks, use data-driven insights to inform updates, and ensure a focus on accessibility and clarity in communications. IRS also reported that it is seeking opportunities to refine outreach methods to meet the needs of its audiences in the digital space. Periodically evaluating its communication approach to providing information to tax professionals, industry, and taxpayers can help IRS ensure it is well positioned for the new reporting to begin. It would help IRS know if its outreach and education efforts are timely, understandable, readily available, and accessible to its audience so IRS can make adjustments to address confusion, if needed.
View More Recommendations

Related Pages

GAO Contacts