In evaluating the performance of a car salesperson, the most important criterion is the number of cars he/she sells. In evaluating the performance of an IRS agent, shouldn’t the single most important measure of effectiveness be the amount of revenue he/she collects? That seems logical, but it’s not the law. And according to a recent audit and report done by the Treasury Inspector General for Tax Administration (TIGTA), that’s not the way the IRS operates.
The IRS Restructuring and Reform Act of 1998 prohibits the IRS from evaluating collection employees based on “ROTER” (records of tax enforcement results). TIGTA gives the following examples of ROTER: amount of dollars collected or assessed, the number of fraud referrals made, and the number of seizures conducted.
So, what is the standard by which IRS employees are judged? I’ll tell you, but you have to promise me you won’t laugh. The standard (as stated in the Restructuring and Reform Act) requires employees to “administer the tax laws fairly and equitably; protect all taxpayers’ rights; and treat each taxpayer ethically with honesty, integrity, and respect.” I know, that sounds ridiculous. That’s not the reality. Besides, how do you measure and track that sort of thing?
I guess it’s on the honor system. IRS managers have to complete quarterly self-certification forms, promising that they did not use ROTERs in their employee evaluations. And here’s how the TIGTA audit went down: they basically made sure that the managers were completing the forms and they reviewed performance documents to ensure they were free of ROTERs. Not surprisingly, the IRS passed the audit with flying colors.
The reliability of the TIGTA report seems questionable to me. Imagine this kind of exchange at the local IRS Collections Office:
Employee Joe: Hey Bob, I nailed a guy with a bank levy today and emptied his whole account, I also seized 4 properties, collected $6 million in penalties, and referred a little old lady to the fraud unit.
Manager Bob: That’s great Joe, but were you nice to these folks in the process?