Trump-Appointed Executive Claims IRS Tech Budget Savings
WASHINGTON, March 20 (Reuters) – A tech executive tasked by the Trump administration with reviewing the Internal Revenue Service’s technology modernization program has announced the cancellation of approximately $1.5 billion in contracts.
Sam Corcos, founder and CEO of the health technology firm Levels, and a special advisor to the Treasury, made the announcement on Fox News Channel. Corcos stated that he identified legacy contracts with external technology consultants related to a systems modernization effort, which he believes was decades behind schedule and excessively costly.
“I think we’ve so far stopped work and cut about $1.5 billion from the modernization budget, mostly projects that were putting us down this death spiral of complexity in our code base,” Corcos said. The cuts come from an annual modernization budget of around $3.7 billion, which sits alongside another $3.5 billion IT systems budget, he explained.
The IRS recently revealed a pause on technology modernization investments to reassess its operational strategy. This decision reflects a shift from the original $80 billion in IRS funding allocated over a decade, part of the 2022 Inflation Reduction Act. The modernization initiative aimed to address years of underfunding and update the agency’s outdated 1960s-era computer infrastructure. The goal included improving taxpayer services and enhancing the IRS’ ability to increase tax collection through sophisticated audits of high-net-worth individuals and businesses.
Republicans in Congress have long criticized the supplemental funding, alleging it was designed to burden taxpayers. Subsequent government funding measures have reduced the original $80 billion by as much as half. Corcos acknowledged the dedication of the IRS’s 8,000 IT employees and stated that they were “super cooperative” throughout the cost review. However, he noted that the agency’s IT costs significantly exceed those of private-sector banks that process comparable amounts of data.
