WASHINGTON --The Treasury Inspector General for Tax Administration (TIGTA) today publicly released its review of the electronic case management system used by the Internal Revenue Service's Tax Exempt/Government Entities (TE/GE) Division.

At the request of the IRS, TIGTA assessed whether implementation of the Tax Exempt/Government Entities Reporting and Electronic Examination System (TREES) led to expected improvements in the examination process and whether appropriate actions are being taken to improve the TREES.

The TE/GE division fully deployed the TREES case management system in 2008. TREES was intended to allow revenue agents and managers to work cases while electronically tracking the inventory of cases throughout all stages of the examination process.

TIGTA's review found the IRS has not achieved the expected improvements in the examination process due to software and hardware difficulties during system deployment and budget cutbacks that impeded delivery of its planned capabilities. Some of these capabilities pertain to core examination processes.

The review also identified opportunities to improve the examination process. TIGTA recommended that the IRS develop an action plan to address the issues identified during the audit, including reeducating and training users. This will allow the TE/GE division to gain increased acceptance and fuller use of the TREES. The IRS agreed with TIGTA's recommendation.

"The Tax Exempt division needs to take additional actions to transform its examination process from one that is paper intensive and inconsistent to an efficient electronic process," said J. Russell George, the Treasury Inspector General for Tax Administration. "This will help the Federal government receive the highest possible return from the $18.7 million of taxpayer funds spent on developing and implementing the system."