The Status of IRS IT Modernization and Integration

For years, the Internal Revenue Service (IRS) has been criticized for its antiquated processes and Information Technology (IT) systems. This analysis explores the current state of the IRS’s appropriations and aims to understand how the agency is spending on programs that are critical to upgrading and modernizing their internal systems to meet the demands required of them.

In order to conduct this analysis, Govini leveraged their exhaustive database of federal contracting actions to understand IRS spending at two levels. First, Govini looked broadly at IRS spending since 2013 on categories relevant to internal IT systems using Product Service Codes (PSC). Second, using their machine learning algorithms, Govini was able to isolate spending on known IRS programs and initiatives aimed at supporting IT modernization and system integration efforts, and conduct deep times into trends for each. This analysis not only shows spending trends, but also critical vendors, key contracts details, and how programs are transitioning from planning to implementation. Given the push to increase funding for the IRS in the coming years, this analysis will be updated to demonstrate how the IRS is using those funds to meet modernization goals.


The American Coalition for Taxpayer Rights (ACTR) was formed in 2011 by the nation’s leading retail tax preparation and tax software companies and financial institutions, which collectively prepare and file more than 120 million of the 155 million federal tax returns annually. ACTR advocates for taxpayer rights and strengthens America’s voluntary tax compliance system.

Tax Preparers

Financial Institutions