IRS needs to do more on ‘Lifting Communities Up’ in Mississippi

The Internal Revenue Service is falling short on its Lifting Communities Up initiative to expand jobs, services, and assistance to taxpayers in underserved populations and communities such as the Mississippi Delta, according to a new report.

The report, released last week by the Treasury Inspector General for Tax Administration, took a closer look at the initiative, which stems from an effort by the IRS to respond to a provision in the Taxpayer First Act of 2019 requiring it to develop a comprehensive taxpayer experience strategy. 

The Lifting Communities Up initiative aimed to rebuild underserved communities by creating IRS jobs and careers for people in these communities. However, the TIGTA report found the IRS continues to face challenges in its efforts to fill positions and to complete infrastructure projects in the Mississippi Delta. The IRS set a goal to open four offices and hire 160 new employees in the Mississippi Delta by the end of fiscal year 2024, but as of last December, the IRS had hired only 24 of its planned 160 employees and opened three of the four offices.  

While IRS officials have visited local communities in the Mississippi Delta, the IRS didn’t pursue a focused, ongoing outreach program or ongoing partnership with local universities and colleges, which was one of the goals of the IRS’s LCU pilot initiative plan. 

“Instead of working with educational institutions for hiring individuals, the IRS resorted to a traditional hiring approach with limited in-person hiring activities,” said the report.  

Last July, IRS officials said for the short-term, the agency would no longer execute its planned training pipeline in the Mississippi Delta because the hiring volume didn’t warrant a pipeline approach. Instead, the IRS will shift its focus and hire people for customer-support jobs that are more viable for entry-level positions that don’t require college degrees or advanced work experience. Nevertheless, the IRS intends to continue its hiring efforts and further expand the initiative based on the availability of jobs, the mission needs of its various business units, and the local community infrastructure.  

The report also found some key steps to ensure the continuation of the LCU initiative haven’t been taken. As of last December, the IRS commissioner had not approved a Request for Organizational Change to formally establish the LCU Program Office. The IRS also hasn’t yet finalized the LCU’s governing and operational policies and procedures or developed key performance measurements to assess the success of the initiative in the Mississippi Delta.

The report also found the IRS changed its approach for identifying communities for potential expansion under the LCU initiative. It’s now focused on maximizing the existing space at the IRS offices or other federal offices that are located within 50 miles of LCU identified communities.  

IRS officials explained that limiting the potential expansion to only those communities within that range of existing federal offices would require less resources because the existing infrastructure would be in place. 

TIGTA made two recommendations in the report, including establishing the LCU Program Office and developing a strategy to conduct in-person recruiting activities at educational institutions and job fairs as part of the Mississippi Delta hiring strategies. The IRS agreed with all the report’s recommendations. 

“LCU has achieved many noteworthy successes to date, including establishing strong partnerships among IRS business units, community organizations and local government to bolster hiring in LCU communities in the Mississippi Delta and Puerto Rico,” wrote Melanie Krause, acting deputy commissioner for operations support at the IRS. 

She noted that the passage of the Inflation Reduction Act of 2022 provided the IRS with historic funding to transform tax administration and services. It also led the IRS to refine its strategic operating plan.

“Although we initially envisioned making continued progress to support the goals of the LCU initiative by opening mail distribution centers and call call sites in LCU communities, we determined that this focus is too limiting,” Krause added. “To that end, we have learned a great deal from this pilot and have identified alternative strategies for more rapidly expanding the impact of this program.”