TREASURY
INSPECTOR GENERAL FOR TAX ADMINISTRATION
Appropriate Actions Were Taken to Maintain Taxpayers’ Level of Service, but Access Is Lower Than That in Prior Years
September 14, 2006
Reference Number: 2006-40-162
This
report has cleared the Treasury Inspector General for Tax Administration
disclosure review process and information determined to be restricted from
public release has been redacted from this document.
Phone Number |
202-927-7037
Email Address | Bonnie.Heald@tigta.treas.gov
Web Site | http://www.tigta.gov
September 14, 2006
MEMORANDUM FOR COMMISSIONER, WAGE AND INVESTMENT DIVISION
FROM: Michael R. Phillips /s/ Michael R. Phillips
Deputy Inspector General for Audit
SUBJECT: Final Audit Report – Appropriate Actions Were Taken to Maintain Taxpayers’ Level of Service, but Access Is Lower Than That in Prior Years (Audit # 200640011)
This report presents the results of our review to evaluate the customer service toll-free telephone access during the 2006 Filing Season.[1] This audit was conducted as part of the Treasury Inspector General for Tax Administration’s annual reviews of the performance of key customer service programs.
Impact on the Taxpayer
The Internal Revenue Service (IRS) planned and met its 2006 Filing Season toll-free performance measurement goals, providing taxpayers with effective access to its toll-free telephone system. We identified opportunities within the toll‑free telephone scripts[2] for the IRS to educate and inform callers, either when taxpayers cannot connect to the toll-free telephone assistance lines or while they are on hold, which should improve taxpayer service and satisfaction.
Synopsis
Each year, millions of taxpayers contact the IRS seeking assistance in understanding the tax law and meeting their tax obligations by calling the various Customer Account Services (CAS) Toll‑Free telephone assistance lines.[3] During the 2006 Filing Season, the IRS made available approximately 9,900 customer service representatives (assistors) to answer the toll-free telephone lines at 25 call centers located throughout the United States and Puerto Rico and provided taxpayers with effective access to its toll-free telephone system.
The IRS achieved 98 percent of its planned assistor services and 110 percent of its planned automated services.
The IRS planned and met its 2006 Filing Season toll-free performance measurement goals: 81.8 percent Level of Service, 295 seconds Average Speed of Answer, and 15 million CAS Assistor Calls Answered. The Level of Service is the primary measure of providing taxpayers with access to a live assistor. Average Speed of Answer is the average number of seconds taxpayers waited in the queue (on hold) before receiving services. Additionally, from January through March 2006, 94 percent of taxpayers that called the IRS toll‑free telephone system and completed customer satisfaction surveys regarding their experience gave the IRS a rating of 4 (mostly satisfied) or 5 (completely satisfied) on a 5-point scale.[4]
While the Level of Service for the 2006 Filing Season did
not decline from that provided in the 2005 Filing Season and customer
satisfaction surveys continue to be positive, the Level of Service is still
below that provided during the 2004 Filing Season. In an attempt to reduce taxpayers’ time
waiting to speak to assistors, the IRS blocked more taxpayer calls in the 2006
Filing Season than in the 2005 Filing Season.[5] More taxpayers disconnected prior to
receiving assistance. Calls answered per
Full-Time Equivalent (FTE)[6]
declined in the 2006 Filing Season.
However, overall, callers waited less time to speak with assistors and
abandoned fewer calls while on hold.
The CAS function’s planning assumptions called for reducing the daily toll-free telephone operating hours from 15 hours to 12 hours, thus requiring fewer assistors to answer toll-free telephone calls. However, Congress enacted legislation[7] restricting the IRS from reducing taxpayer services until the Treasury Inspector General for Tax Administration had completed a study of the proposed changes. As a result, the IRS did not reduce toll-free telephone hours of operation in Fiscal Year 2006 and stated that being unable to reduce the toll-free telephone hours of operation while trying to maintain the same Level of Service during the 2006 Filing Season was not without costs. When the reduced operating hours were not implemented, it was too late for the CAS function to hire and train seasonal assistors. Therefore, there were fewer assistors available to answer the telephones.
Additionally, a review of telephone scripts used for 6 of 16 CAS Toll-Free telephone product lines showed the IRS has opportunities to educate and inform callers, either when taxpayers cannot connect to the toll-free telephone assistance lines or while they are on hold. For example, when the IRS is experiencing a high call volume or the taxpayer is calling outside the toll-free telephone operating hours, the IRS could educate the taxpayers or inform them of its self‑help services. When a taxpayer is on hold, the IRS could provide information on new tax laws or upcoming filing deadlines or dates.
Recommendation
We recommended the Commissioner, Wage and Investment Division, review all toll-free telephone English and Spanish Call Flow Scripts for opportunities to educate the taxpayers or to inform them of self-help services on IRS.gov.
Response
IRS management agreed with our recommendation, stating that reviewing English and Spanish telephone call flow scripts may identify opportunities to educate taxpayers or inform them of self-help services. The IRS currently reviews the call flow scripts on a regular basis and agreed that there is value in looking for additional instances in which such announcements might be appropriate. It will also look closely at the costs of adding and maintaining such messages to determine the feasibility of doing so. Management’s complete response to the draft report is included as Appendix VI.
Copies of this report are also being sent to the IRS managers affected by the report recommendation. Please contact me at (202) 622-6510 if you have questions or Michael E. McKenney, Assistant Inspector General for Audit (Wage and Investment Income Programs), at (202) 622-5916.
Toll-Free Telephone Scripts
Could Be Used to Inform and Educate Taxpayers
Appendices
Appendix
I – Detailed Objective, Scope, and Methodology
Appendix
II – Major Contributors to This Report
Appendix
III – Report Distribution List
Appendix V –
Joint Operations Center
Appendix
VI – Management’s Response to the Draft Report
Abbreviations
|
CAS |
Customer Account Services |
|
FTE |
Full-Time Equivalent |
|
IRS |
Internal Revenue Service |
|
TIGTA |
Treasury Inspector General for Tax
Administration |
Each
year, millions of taxpayers contact the Internal Revenue Service (IRS) seeking
assistance in understanding the tax law and meeting their tax obligations by
calling the various toll-free telephone assistance lines. Taxpayers called the IRS Customer Account
Services (CAS) Toll‑Free telephone assistance lines approximately 51.7
million times[8]
during the 2006 Filing Season.[9] Of these calls, 17.7 million were made to the
toll-free telephone number, 1‑800‑829-1040, the telephone number
taxpayers call to ask tax law or account-related questions. In addition, over 8 million calls were made to the IRS automated TeleTax system
that provides recorded tax law and refund information. Figure 1 shows the number of calls made to
the CAS Toll-Free telephone assistance lines and the 14.6 million calls
answered during the 2006 Filing Season.
Figure 1: Calls Handled by the IRS in the 2006 Filing
Season
Figure 1 was removed
due to its size. To see Figure 1, please
go to the Adobe PDF version of the report on the TIGTA Public Web Page.
The CAS Toll-Free telephone assistance
lines are further subdivided into categories called “applications.” Each application is staffed with a group of customer
service representatives (assistors) that have received specialized training to
assist taxpayers with specific tax issues.
Assistors answer taxpayer questions
involving tax law and tax account-related conditions such as refunds, balance-due
billing activity, and changes to the amount of taxes owed. For example, if an
individual taxpayer calls to find out where to mail a tax return, the call
would be routed to an assistor who has been trained to handle IRS procedural
issues for individual taxpayers. If a
business taxpayer calls to find out the taxes due on a business account, the
call would be routed to an assistor who handles balance-due questions for the business
taxpayer.
During
the 2006 Filing Season, the IRS made available approximately 9,900 assistors to
answer the toll-free telephone lines at 25 call centers[10]
located throughout the
Figure 2: CAS Toll-Free Telephone Service Product Lines and Number of Calls Answered[11] During the 2006 Filing Season
Figure 2 was removed due to its size. To see Figure 2, please go to the Adobe PDF version of the report on the TIGTA Public Web Page.[12]
The IRS had planned to reduce toll-free telephone hours of operation in Fiscal Year 2006
As part of its strategy to reduce costs, the IRS had planned
to reduce the toll-free telephone hours of operation from 15 hours to 12
hours. Currently, taxpayers can call the
toll-free telephone lines and reach an assistor from 7 a.m. to 10 p.m. local
time.[13] The IRS planned to change the hours taxpayers
can reach an assistor to 8 a.m. to 8 p.m. local time. The IRS estimated that reducing the hours and
restricting a caller to local time zones could save approximately
410 Full-Time Equivalents (FTE)[14]
at a cost of approximately $18 million.
The IRS had planned to implement the new toll-free telephone operating
hours in October 2005 and briefed the National Treasury Employees Union about
the reduction on June 7, 2005.
However, due to concerns raised by the National Treasury
Employees Union and the National Taxpayer Advocate over the proposed
closing of several Taxpayer Assistance Centers[15]
nationwide, Congress enacted legislation on November 30, 2005,[16]
restricting the IRS from reducing taxpayer services until the Treasury
Inspector General for Tax Administration (TIGTA) had completed a study of the
proposed changes. Congress further defined a reduction of taxpayer
service to include limiting available hours of toll-free telephone taxpayer
assistance. As a result, the IRS did not
reduce toll-free telephone hours of operation in Fiscal Year 2006.
This review was performed at the Joint Operations Center in Atlanta, Georgia, during the period January through June 2006. The audit was performed in accordance with Government Auditing Standards. The scope of this audit did not include an assessment of the quality of toll-free telephone services. The performance data we evaluated were provided by IRS management information systems. We did not verify the accuracy of these data. Detailed information on our audit objective, scope, and methodology is presented in Appendix I. Major contributors to the report are listed in Appendix II.
The IRS planned and met its 2006 Filing Season toll-free performance measurement goals–81.8 percent Level of Service, 295 seconds Average Speed of Answer, and 15 million CAS Assistor Calls Answered–and provided taxpayers with effective access to its toll-free telephone system. The Level of Service is the IRS’ primary measure of providing taxpayers with access to a live assistor. Average Speed of Answer is the average number of seconds taxpayers waited in the queue (on hold) before receiving services. Figure 3 shows the actual performance measures for the last four filing seasons.
Figure 3:
Comparison of the Performance Measures
for the 2003–2006 Filing Seasons
|
CAS
Toll-Free |
2003 |
2004 |
2005 |
2006 |
|
Level of
Service |
83.1% |
85.0% |
81.8% |
82.0% |
|
Average Speed
of Answer (seconds) |
175 |
184 |
255 |
213 |
|
CAS Assistor
Calls Answered (millions) |
15.8 |
16.8 |
15.6 |
14.6 |
Source: IRS Enterprise Telephone Data Warehouse.
In addition, from January through March 2006, 94 percent of the taxpayers that called the IRS toll-free telephone system and completed customer satisfaction surveys regarding their experience gave the IRS a rating of 4 (mostly satisfied) or 5 (completely satisfied) on a 5-point scale.[17] The overall satisfaction rating was 4.7. Only 2 percent of the taxpayers were dissatisfied (i.e., gave a rating of 1 or 2).
The IRS planned for fewer taxpayer calls
In preparation for the 2006 Filing Season, the
The IRS planned to provide approximately .5 million fewer toll-free telephone assistor services and 2.9 million fewer automated services to taxpayers. The IRS defines a service as an issue or multiple issues handled by a single assistor. In general, one service equates to one or more taxpayer questions answered by one assistor. For example, one call might result in the IRS counting three services provided for one taxpayer: (1) asking a tax law question and requesting a form (two questions equals one service by one tax law assistor), (2) asking the status of an Employer Identification Number (one service by a business assistor), and (3) asking the status of the customer’s individual account (one service by an individual account assistor).
For the 2006 Filing Season, the IRS achieved 98 percent of its planned assistor services and 110 percent of its planned automated services. Toll-free telephone automation and assistor services provided for the last two filing seasons have decreased steadily. There has also been a decline in tax law services due to more individuals using tax preparation software that thoroughly explains the preparation of their tax returns. Figure 4 shows the number of CAS Toll‑Free telephone services provided for the last four filing seasons.
Figure 4: Comparison of CAS Toll-Free Telephone
Services
Provided for the 2003–2006 Filing Seasons (in millions)[19]
|
CAS Toll-Free |
2003 |
2004 |
2005 |
2006 |
|
||||
|
Automated Services Provided[20] |
26.8 |
26.5 |
19.8 |
18.6 |
|
||||
|
Assistor Services Provided |
18.5 |
19.6 |
18.3 |
17.4 |
||||
|
Totals |
45.3 |
46.1 |
38.1 |
36.0 |
||||
Source: IRS
Enterprise Telephone Data Warehouse.
The decline in services made to the CAS Toll-Free telephone
assistance lines is in part attributed
to the continued increase in taxpayers’ use of the Internet Refund Fact of Filing application, which allows taxpayers to check
the status of their tax refunds. During
the 2006 Filing Season, taxpayers made approximately 25.4 million attempts
to access the Internet Refund Fact of Filing application.
This represented a 16.5 percent increase from the 2005 Filing Season
(from 21.8 million to 25.4 million).
The Level of Service was below that provided during the 2004 Filing Season
Each year, the IRS allocates FTEs to the Accounts Management function for operation of the toll-free telephone program. Based on these budgeted resources, the CAS function can plan for the number of taxpayer calls that will be answered by assistors and the numbers of services taxpayers may need during the calls. The CAS function has about 400 fewer FTEs for toll-free telephone operations than it had in Fiscal Year 2005. These data are used to set the Level of Service goal for the filing season.
IRS officials explained that there are various components
of the Level of Service. To ensure the
IRS provides taxpayers with the planned Level of Service, the IRS attempts to
balance these components to reach its Level of Service goals. For example, it controls the number of
taxpayer calls allowed into the toll-free telephone system to help improve the
taxpayers’ experiences once they connect to the system. In an attempt to reduce taxpayers’ time spent
waiting to speak to assistors, the IRS blocked more taxpayer calls in the 2006
Filing Season than in the 2005 Filing Season.
A blocked call is one that cannot be connected immediately because
either no circuit is available at the time the call arrives, (i.e., the
taxpayer receives a busy signal) or the system is programmed to block calls
from entering the queue when the queue backs up beyond a defined threshold (i.e.,
the taxpayer receives a recorded announcement to call back at a later
time). The IRS refers to the latter type
of blocked call as a courtesy disconnect.
Figure 5 shows a comparison of various components (workload indicators)
the IRS uses to manage the Level of Service.
Figure 5:
Comparison of CAS Toll-Free Telephone Level of Service
Components for the 2003–2006 Filing Seasons[21]
|
CAS Toll-Free |
|