The IRS is often called upon to assist other branches of the Federal Government. Even though the IRS is normally willing to “do them a solid,” those agencies that contract with the IRS through reimbursable work agreements are not paying the IRS fairly. The IRS is not always getting fully reimbursed for services rendered. But according to the latest TIGTA audit report, nobody deserves more blame for this than the IRS itself.
To give an idea of how common these service agreements are, TIGTA identified 89 such agreements in 2011 alone. They selected just 6 agreements for audit and found that 50% of them were not reimbursed properly. These are some of the problems TIGTA found:
- IRS is not consistently including overhead in the calculation of the reimbursable service costs
- IRS is not consistently documenting the costs associated with service agreements so they can be independently verified
- IRS is not consistently involving the CFO Office of Cost Accounting in the calculation of overhead
These are multi-million dollar errors that result in less money to spend on frustrating the tax relief efforts of ordinary taxpayers and their attorneys. Further proof that the IRS needs to do better with what they’ve got before we can in good conscience allocate to them any more funding.