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Critical Human Capital Issues Dominate IRS Oversight Board’s August Meeting

​(Washington, DC) The IRS Oversight Board met on August 15th with Acting Commissioner Kevin M. Brown, Deputy Commissioner Linda Stiff and other senior officials to focus on human capital issues and the status of the IRS Business Systems Modernization (BSM) program.

From its ongoing participation this summer at the IRS National Tax Forums, held at cities throughout the U.S., the Board continues to hear that human capital issues represent a major strategic challenge to the IRS as its workforce ages and key talent retires from the agency.

IRS Oversight Board Chairman Paul Jones commented, “About 4,000 IRS employees a year for the next four years are expected to retire, taking with them years of experience and valuable skills. Maintaining and growing workforce skills during this period of change must be addressed in a strategic manner.”

The IRS presented its strategies for employee retention, recruitment and compensation. The overall strategy for retaining employees includes bonuses and waiving various restrictions on the use of retired annuitants. Recruitment presents its own challenges, as the IRS seeks to replace employees who leave and expand the size of its existing workforce in the area of enforcement. The Board’s discussions with the IRS centered on issues such as identifying needs, quantitative goals, objective measures, and planning horizons. The IRS’ priorities for FY2008 include beefing up agency-wide revenue agent hiring, expanding filing season recruitment support, and targeting key demographics in the recruitment pool. The Board will continue to focus on workforce issues in the coming year, with attention placed on employee satisfaction, training, and career development. 

Compensation issues were discussed, especially the ability of the pay for performance program to serve as a meaningful incentive for higher performance. The Board questioned whether the IRS has measures that can evaluate the effectiveness of the current pay for performance system to motivate high performance. 

Board Chair Jones concluded, “The IRS’ workforce is extremely talented and dedicated but cannot be taken for granted. Both the Board and the IRS are committed to the long-term career development of its employees, which the Board expects will be mutually beneficial to both the agency and its employees.”

The Board also received a status report on the IRS Business Systems Modernization program, which showed largely positive results. Overall, the Board is encouraged with the progress made, and emphasized the importance of technology modernization to achieving the IRS long-term goals of enhancing enforcement, improving service, and reducing burden.

The Board will next meet in Washington, DC on September 25th-26th, 2007.

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