Prepared Statement of Witness 4 before the Senate Finance Committee Oversight Hearing of the Internal Revenue Service

Testimony Taxes

Prepared Statement of Witness 4 before the Senate Finance Committee Oversight Hearing of the Internal Revenue Service

September 25, 1997 5 min read
Witness 4

Statement before the Senate Finance Committee 

Mr. Chairman, Senators, thank you for allowing me to appear before you today and share with you some personal observations I have made during the more than 25 years I have been employed by the Internal Revenue Service. For the majority of these years, I have served as a Revenue Officer in the IRS' Collection Division. Until very recently, I felt a great sense of pride in my job. I actually looked forward to going to work. Over this past year, however, I have seen dramatic changes take place in this organization and, in my opinion, most were not for the good of the Service, or the public that we are supposed to serve.

In the past, with few exceptions, I felt that management truly cared for its employees. I find this no longer to be the case. I have never seen overall morale in the IRS as low as it is right now. Many of my fellow colleagues have expressed to me recently that they no longer feel motivated, and many are feeling the physical and emotional effects of constant stress.

Management fails to acknowledge employee concerns as evidenced by the fact that they refuse to hear grievances or address workplace concerns. Managers fail to realize that if employees are under stress or disillusioned with the Service, their attitude will surely flow to the taxpayers, the people we are paid to serve.

I have recently seen many abuses by IRS managers as well as first line employees. These abuses range from the deception of taxpayers to gross misuse of travel funds I could write a book on the subject of IRS abuse of both its employees and of the American taxpayer. Allow me to provide some brief examples.

But before doing so, allow me to point out that I have never had a performance problem during my employment with the IRS. To the contrary, I have received numerous annual performance awards, so I am not here today because I have any axe to grind. I truly hope that by appearing before you that I can contribute -- positively -- to restore pride in our organization and reestablish the confidence of taxpayers.

The area that causes me significant concern is the widely varied treatment that taxpayers can, and do receive. The IRS' approach toward a taxpayer can vary dramatically depending upon the IRS Group Manager whose group is assigned the case; depending on the employee working the case; and/or depending on the Collection Division policy in effect at the time the case is received. For example, you may have one business owner who is allowed to make monthly payments on delinquent employment taxes, while another business owner, given the same set of circumstances, is put out of business or forced into bankruptcy. In other words, one taxpayer may have their taxes simply "written off" as uncollectible, while another taxpayer under the identical conditions, may be forced to pay their taxes in full, or risk losing a home or business.

Taxpayers deserve a consistent and fair policy when it involves the survival of their businesses.

Another concern I have is based on the fact that collection initiatives change regularly. It appears that management is more concerned about maintaining high statistics than with the quality of work being performed, or even whether the taxes were collected, or were just written off. Whenever there is pressure to maintain high statistics, and the performance levels of the different departments within the organization are a source of constant comparison, you can be certain that someone is going to suffer the consequences of such an explosive situation -- and it is usually the taxpayer.

Recently a local Revenue Officer planned an elaborate sale to dispose of certain assets seized from a taxpayer. Many of the IRS employees were invited to help in the effort. The Group Manager was also present. Even though the Revenue Officer failed to achieve the minimum bid, as required by law, before selling the assets, he went ahead and sold the property at a significant loss to the taxpayer. Property which had a minimum bid of at least $40,000 was sold for roughly $7,000. Although this wrongdoing was found out and the Revenue Officer and his manager now face possible disciplinary actions, the real victim is the uncompensated taxpayer.

In terms of travel abuse, I know of situations where managers arrange travel to outlying IRS offices simply to accommodate their own personal travel. They charge the government mileage and occasionally, even a night's lodging, in their effort to get to their final vacation destination. A previous District Director, who had a condo at the beach, would frequently make brief appearances at the outlying IRS offices while his family waited for him in the car. When his visit was over, he and his family would simply continue their drive to the beach. All this was done at taxpayer's expense while management was telling employees that they had to conserve on official travel, and that overnight lodging was not permitted. While this may seem minor compared to many other things you will hear in this hearing, trust me when I say these activities by management have a devastating effect on morale.

In another abuse of travel funds, a Collection Division Chief assigned a Revenue Officer in her office to travel out of state in an effort to check-up on the work habits of other IRS employees. Extensive travel was involved and the secret investigation of our own agents caused significant confusion among taxpayers and IRS employees alike. When contacted by this IRS employee, who was following up behind the work of the real case agent, some taxpayers called their local IRS offices. Some of the local officials initially thought that an IRS impersonator was at work. In fact, a taxpayer with whom I had been working was contacted by this "spy" employee, and contacted me afterward, wanting to know what I thought was going on. Fortunately, in this case, nothing detrimental occurred to affect my taxpayer's case, but the manner in which this secret study was conducted was underhanded and humiliating to the rest of the IRS employees involved. In addition, if this information was determined to be of such importance to the out-of-state Collection Division Chief, why not inquire about such information in a professional, above board manner, not deceptively behind employees' backs. The effort undoubtedly would have been more effective, less disruptive and certainly far less costly to everyone involved -taxpayers and IRS employees alike.

Mr. Chairman, I greatly appreciate being afforded this opportunity to inform this Committee of what I have observed while working with the IRS, and the great disservice the actions of some of my colleagues have brought upon unsuspecting and undeserving taxpayers, not to mention each other. When the American taxpayer is defrauded of their due rights, we all stand to suffer.

It is not a pleasure for me to share such stories with you. These stories are about my colleagues, those with whom I work. But my intention to do so is simple. I, too, am an American taxpayer, and I am asking this Committee to return the Service's management and operational standards to the level that will again earn my own trust, as well as that of all tax paying Americans.

Thank you.

The Heritage Foundation is a public policy, research, and educational organization recognized as exempt under section 501(c)(3) of the Internal Revenue Code. It is privately supported and receives no funds from any government at any level, nor does it perform any government or other contract work.

The Heritage Foundation is the most broadly supported think tank in the United States. During 2013, it had nearly 600,000 individual, foundation, and corporate supporters representing every state in the U.S. Its 2013 income came from the following sources:

Individuals 80%

Foundations 17%

Corporations 3%

The top five corporate givers provided The Heritage Foundation with 2% of its 2013 income. The Heritage Foundation’s books are audited annually by the national accounting firm of McGladrey, LLP.

Members of The Heritage Foundation staff testify as individuals discussing their own independent research. The views expressed are their own and do not reflect an institutional position for The Heritage Foundation or its board of trustees.


Witness 4