Monday, November 7, 2011

Has the IRS Reorganization Worked?

Almost thirteen years ago, the IRS “reinvented” itself with a massive reorganization which changed the IRS corporate culture and the way the IRS had been doing business since 1952. Before 1998, the IRS was organized by geographical districts and regions which were virtual fiefdoms where district directors ruled over chiefs of collection, examination, and criminal investigations.  In the 1998 Reorganization, the districts and regions were abolished. Under the new regime, the 100,000 IRS employees were realigned by the functions in which they specialized so that front line managers reported directly to “Area” managers who in turn reported directly to Washington. It took the IRS almost four years to sort things out before employees and the public figured out who was in charge and who was making key decisions.  IRS employee morale plummeted for a long time and enforcement statistics made Congress and IRS practitioners wonder whether anyone at all was working at the IRS but that has all been worked out and IRS enforcement is now hitting its stride in examinations, collections, and criminal investigations.  





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