A new report from the Treasury Inspector General for Tax Administration (TIGTA), has found that, while rising numbers of taxpayers are using the internet for their tax arrangements, the United States Internal Revenue Service (IRS) has still missed its target for increasing the number of online payment agreements.
TIGTA has concluded that the On-line Payment Agreement (OPA) program has actually met only 10 percent of its goal, despite increasing usage, and, as a result, the IRS is not meeting its planned objectives for increasing revenue or reducing taxpayer burden and costs. The IRS implemented the OPA web application in 2006 to provide individual taxpayers or their authorized tax representatives with a simple and convenient way to establish payment agreements, while eliminating the need for paper forms, toll-free calls, and personal interaction with the IRS. This is intended to reduce compliance costs for the IRS as well as saving time for taxpayers.
TIGTA therefore initiated its audit to determine the effectiveness of the OPA program in achieving its goals of reducing taxpayer burden and increasing revenue through a shift from paper to online payment agreements. Taxpayer use of the OPA program increased from nearly 18,300 taxpayers in Fiscal Year (FY) 2007 to 96,000 in FY 2012 (a 425 percent increase), and the default rate of streamlined instalment agreements processed through the OPA program is 44 percent lower than the overall default rate, which means that more taxpayers continued to make their regular payments.
