Most IRS Contracting Dollars Go to IT With Challenges Persisting

The Internal Revenue Service put 61% of its procurement spending to IT products and services from fiscal 2015 through the third quarter of fiscal 2024, totaling $15 billion.

The IRS is facing proposed budget cuts in fiscal 2025, though the Democrats’ tax-climate-health law (Public Law 117-169) provided a $4.8 billion funding infusion through fiscal 2031 to support the agency’s IT system modernization.

The Financial Services appropriations bill (H.R. 8773; see BGOV Bill Summary), which was pulled from consideration last week ahead of House lawmakers leaving for August recess, would cut IRS funding. The decrease ...