Gone are the days when a tax return involved a single employer, with a single W2, and relatively straightforward reporting. Today, over 20% of the U.S. population is involved in the gig economy, often working for multiple companies, and new digital revenue streams are further complicating the ability of the Internal Revenue Service (IRS) to accurately scrutinize and verify tax returns. Adding deliberately fraudulent returns into the mix creates an additional layer of complication, and like many federal IT services, the IRS’s automated fraud detection system is in need of modernization. To that end, Accenture Federal Services (AFS) has recently won a $73 million contract to support the agency in operating and maintaining this system.
The IRS Return Review Program (RRP) is an automated system that screens tax returns to detect and select potentially fraudulent returns to prevent invalid refunds from being paid out. The system’s performance is routinely monitored and adapted to improve detection and address evolving threats. Each year, the system is updated to improve accuracy for the next filing season.
AFS will be focused on improving the RRP, using innovative technologies and advanced analytics to help the IRS expand anomaly detection for individual and business tax returns. The work will include a variety of enterprise modernization efforts, including leveraging cloud architecture, automation, testing, and agile methodologies to help the IRS create more value in its program. The firm has an over 40-year history of supporting the government’s Treasury Department, with recent wins including a $13 million CFIUS Case Management O&M Support task, a $137 million CADE 2 ITPE Development task, and a $18 million Return Integrity & Compliance Services (RICS) modernization contract.
The cost of the contract pales in comparison to the impact it will have, as return fraud threatens the integrity of the tax system and costs taxpayers billions of dollars annually. For example, the IRS reported that between January 2015 and November 2017, RRP stopped the issuance of over $6.51 billion in invalid refunds. By streamlining the IRS’ ability to detect and stop fraud, AFS will free up valuable labor resources, reduce taxpayer expenses, and hopefully speed tax return processing.