Treasury Inspector General for Tax Administration
July 7, 2010
TIGTA - 2010-30
Contact: David Barnes
WASHINGTON - The Internal Revenue Service (IRS) successfully implemented improvements to the Health Coverage Tax Credit (HCTC) required by Congress under the American Recovery and Reinvestment Act (Recovery Act), according to a report publicly released today by the Treasury Inspector General for Tax Administration (TIGTA).
The HCTC was created by the Trade Adjustment Assistance Reform Act of 2002. The Recovery Act increased the portion of health insurance premiums paid by the Federal government to credit recipients from 65 percent to 80 percent and expanded taxpayer eligibility in the HCTC Program.
TIGTA assessed whether the IRS implemented the mandated changes, whether the processes followed were effective and efficient and whether eligible taxpayers were receiving the Credit.
According to TIGTA's report, the IRS successfully developed three HCTC system releases, allowing it to effectively and timely provide the new and increased benefits to affected taxpayers. However, the IRS needs to improve its management processes to ensure that planned projects meet taxpayer and IRS needs.
TIGTA made four recommendations to improve the IRS's management processes. The IRS agreed with TIGTA's recommendations and stated that corrective actions have been taken or started.
"The IRS is to be commended for their efforts to upgrade the system," said J. Russell George, the Treasury Inspector General for Tax Administration. "Actions taken to improve the system development processes will improve the effectiveness of future upgrades to the Health Coverage Tax Credit Program," Mr. George added.
To view the report, including the scope, methodology, and full IRS response, go to: https://www.treasury.gov/tigta/auditreports/2010reports/201021057fr.pdf.
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