IRS Shares its Strategic Operating Plan for the Decade Ahead

In unveiling its new Strategic Operating Plan for the next 10 years, the Internal Revenue Service (IRS) outlines its blueprint for an agency transformation that includes attracting, developing and retaining the kind of exceptional talent that will deliver “world-class service” to taxpayers.

Issued earlier this month, the 150-page report to the Secretary of Treasury details what the IRS describes as “historic plans” to make fundamental changes in the wake of funding the agency received with the passage of the Inflation Reduction Act in 2022.

The plan the IRS lays out in the new document is organized around five objectives, including quickly resolving taxpayer issues when they arise, delivering cutting-edge technology, data and analytics to operate more effectively, and attracting, retaining and empowering a highly skilled, diverse workforce and developing a culture that’s better equipped to deliver results for taxpayers, according to the agency.

Each of these objectives will be met through specific initiatives outlined in the plan, which contains 42 initiatives designed to achieve IRS goals, each of which includes multiple key projects and milestones to measure progress, according to the report. For each milestone, the plan includes specific timeframes based on year.

With regard to its goal to attract and retain a skilled and diverse workforce, the agency looks to “invest in and focus on people, equipping and empowering them with the technology, equipment, training and tools they need to be successful,” according to the operating plan, which promises to “modernize” how the IRS attracts, retains and develops its people.

“We will assess and reshape the workforce to meet future requirements, foster a positive employee experience, and create a workplace that reflects the diversity of the taxpayers we serve and the unique talents of each person.”

Building a Broader, More Diverse Workforce

According to an IRS statement, the agency sought input from numerous sources in this “effort to identify the highest priority opportunities to deliver transformational change.”

In addition to working with the Department of Treasury, the IRS also gathered feedback from tax professionals, partner groups inside and outside the tax community, taxpayer groups, IRS federal advisory groups and IRS employees, according to the organization.

The input the agency received helped the IRS define the objectives the plan spells out, including its goal to “grow our workforce to meet the mission of the agency, after years of shrinkage and declines in service to taxpayers, and to ensure adequate enforcement of the tax law.”

The IRS has identified modernization of its technologies, policies and processes as a key component to achieving this particular objective. In its report, the agency vows to adopt strategies and technologies designed to help the organization keep pace and evolve with changes, “enabling new ways of working while ensuring our people are engaged, agile and highly skilled, including in data and analytics, and have access to the information they need to work effectively.”

From a recruitment and retention perspective, the IRS plans to focus on underreached and underrepresented communities as part of its effort to build a broader and more diverse workforce.

Noting a need for IRS employees with “a broader foundation of core competencies,” the agency plans to focus on becoming more data-centric, and expects to its number of data scientists to grow significantly, for example. IRS compliance functions will rely on specialized teams who respond to “increasingly complex filings,” according to the IRS, which also plans to seek out and cultivate skills like problem-solving, communication and collaboration.

The operating plan also highlights a number of indicators of success the IRS will rely on to measure progress on the recruitment and retention front, such as increased proficiency in critical skills across the IRS workforce, increased number of qualified applicants and quality hires, and a workforce composition that “more closely resembles the taxpayers we serve.”

In terms of achieving its recruitment and retention-specific objectives, as well as its broader goals for the next 10 years, the new strategic operating plan “is only the beginning of our work,” IRS Commissioner Danny Werfel said in a statement.

“This is a unique opportunity for the IRS and the nation, and we will continue to work closely with our partners as this effort moves forward. This investment in the IRS is already helping taxpayers this tax season, and this plan shows that historic changes are coming.”