Tax Administration: Many Taxpayers Rely on Tax Software and IRS Needs to Assess Associated Risks

ISBN-10: 143791506X
ISBN-13: 9781437915068
Series: Tax administration
Pages: 43
Language: English
Published: 2009-09
Publisher: DIANE Publishing
Author: James R. White

Description

Individual taxpayers used commercial tax software to prepare over 39 million tax returns in 2007, making it critical to the tax administration system. The majority were then filed electronically, resulting in fewer errors and reduced processing costs compared to paper returns. This report assesses what is known about how pricing of tax software influences electronic filing, the extent to which the Internal Revenue Service (IRS) provides oversight of the software industry, and the risks to tax administration from using tax software. To do so, the auditor analyzed software prices, met with IRS and software company officials, examined IRS policies, and reviewed what is known about the accuracy, security, and reliability of tax software. Charts and tables.