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IRS Spent $43 Million on Undeliverable Mail in Fiscal 2018

Sept. 16, 2019, 3:05 PM

About 14.4 million pieces of mail were returned to the IRS in fiscal year 2018 because they were sent to the wrong addresses, according to the agency’s watchdog.

The mistake cost an estimated $43 million, or $3 per piece of undeliverable mail, the Treasury Inspector General for Tax Administration said in a report publicly released Sept. 16.

“When the IRS does not maintain current taxpayer addresses, it wastes postage and labor processing undeliverable mail,” the watchdog said.

  • The Internal Revenue Service had marked previous TIGTA recommendations on this issue as completed, the watchdog said. But the latest review found the same deficiencies as before.
  • Mail returned as undeliverable can result from taxpayers moving without providing forwarding addresses to the U.S. Postal Service. It can also result from the IRS not having an accurate address in its systems because taxpayers provided the wrong address or IRS employees entered the information wrong.
  • TIGTA recommended that the IRS develop service-wide processes for limiting correspondence when addresses are questionable. The watchdog also suggested that the agency install software to perfect its database of addresses. IRS management agreed partially with the first recommendation, wholly with the second.

To contact the reporter on this story: Allyson Versprille in Washington at aversprille@bloombergtax.com

To contact the editors responsible for this story: Patrick Ambrosio at pambrosio@bloombergtax.com; Kathy Larsen at klarsen@bloombergtax.com

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