Yellen memo reportedly directs IRS to modernize, address backlog

Treasury Secretary wants decades-old IT system overhauled.

Updated: August 18, 2022 - 1:52pm

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Treasury Secretary Janet Yellen this week reportedly told the IRS to overhaul its decades-out-of-date management systems and address its crushing backlog in an effort to modernize and streamline the revenue service. 

Yellen, in a memo the Associated Press says it obtained, directed IRS Commissioner Chuck Rettig to "moderniz[e] IRS computer systems and ensur[e] the agency has an adequately-staffed workforce" as it prepares to receive a whopping $80 billion in funding over the next 10 years. 

The IRS has been criticized for its massively out-of-date computer systems, which have famously cost much more than predicted over the years and which have lagged in modernization due to persistent implementation delays. 

Yellen also told the IRS to "fully resolve the inventory backlog and make significant improvements in taxpayer services," a nod toward the agency's record backlog this year that resulted in snarled tax returns and major delays for taxpayers. 

The IRS has been at the center of controversy in recent weeks due to the major infusion of federal funding it will receive over the next decade, as well as the fact that the agency will be hiring tens of thousands of new workers to carry out collection undertakings against American taxpayers. 

Yellen has claimed that the agency will only focus on "high-end" taxpayers, directing the IRS to avoid increasing audits on Americans earning less than $400,000 per year.