IRS takes on a summer job: special tax refunds

IRS takes on a summer job: special tax refunds


The rush job of issuing one-time tax refunds this summer will not slow down the IRS' ongoing modernization efforts, the agency's chief information officer promises.

The IRS has tapped 15 programmers and program managers from its Information Technology Services group to work on the refund project. That leaves untouched the Business Systems Modernization Office, which overlooks the modernization effort, said John Reece, CIO and deputy commissioner for modernization.

Three software changes were necessary to the mainframe tax-processing system to calculate the special calendar 2000 refunds, Reece said.

Calm and calculated

The new program will calculate the refunds based on taxpayers' filing status and the taxable incomes on their returns for last year.

'We deal with these situations every day, not just for refund checks. We've tried to be bulletproof, but with a program so big, there will be problems.'

Single taxpayers receive up to $300, heads of households up to $500 and married couples up to $600. Taxpayers who were claimed as dependents on someone else's 2000 return are not eligible for the refunds.

The amount of an individual's refund will be reduced by any outstanding federal debt, such as past-due child support or unpaid federal or state taxes.

The IRS also has updated its mainframe systems to check each taxpayer's Social Security number. The last two digits of the number will determine the mailing date of the refund check.

For example, if a taxpayer's last two digits are 00 to 09, the refund will be mailed the week of July 23. The last set of checks will be mailed to taxpayers the week of Sept. 24.
Still another programming change will update each taxpayer's records for the next filing season.

This change was necessary because the Economic Growth and Tax Relief Reconciliation Act allows persons who did not have taxable income in 2000, or who were dependents, to claim the credit if they pay income tax for this year.

The IRS' Master File and Integrated Data Retrieval systems are written in assembly language and still rely on batch processing and tape transfer among IRS processing centers.

'We've tested and retested the changes and are confident that we have the system in place,' Reece said.

An IRS contractor will mail 99.7 million letters this summer to inform taxpayers of the amounts of their checks and the weeks they will be mailed. Letters of explanation also will go out to ineligible taxpayers.

Lost or stolen

The IRS has procedures in place for dealing with stolen checks and cases in which a taxpayer does not inform either the agency or the Postal Service of an address change, Reece said.

The IRS will verify taxpayers' addresses against USPS' address database, which the Postal Service updates weekly.

'We deal with these situations every day, not just for refund checks,' Reece said. 'We've tried to be bulletproof, but with a program so big, there will be problems.'

Added bonus

As the special refund effort is kicking off, the tax agency today will also roll out its Customer Communications initiative, which includes automated call routing, a prompting system and a voice recognition program for refund queries, he said.

The new communications system will increase telephone accessibility, aid rotary-phone users, reduce the amount of routing by agents and cut maintenance costs, Reece said.

'This is very timely because we will be able to include recorded information about the mail-out schedule and steps for figuring the advance refund amount' for the special 2000 refunds, Reece said.

The agency has distributed news releases about the refunds through national and local media outlets, IRS spokeswoman Tamara Ward said.

Taxpayers do not need to do anything to receive their refunds, she said. Nor do they have to report the refunds as taxable income for 2001.

The Web site will continue posting information about the process, from the first stage of notifying taxpayers by mail through distributing the checks, Ward said.


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