TIGTA exposes faults in operation of electronic payments system

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2026

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement


TIGTA exposes faults in operation of electronic payments system

fotoflexer-phototigta.jpg

Business taxpayers in the US were not always told by the IRS when they were in breach of a new federal regulation enabling them to pay their taxes online or by telephone, a report from the Treasury Inspector General for Tax Administration (TIGTA) has found.

The Electronic Federal Tax Payment System (EFTPS), which allows businesses and individuals pay their federal taxes electronically via the internet or telephone 24 hours a day, seven days a week took effect on January 1 2011. And the Internal Revenue Service is supposed to operate the Federal Tax Deposit (FTD) Alert Program to help taxpayers manage their liabilities so they do not become unable to pay mounting debts that arise from their failure to use the electronic payments system in time.

However, while TIGTA found that the IRS had taken the necessary steps to inform businesses about EFTPS . The tax authorities sent an intention letter to 3.8 million taxpayers affected by the change in November 2010 and a mandate letter the following month to 1.4 million who had not yet activated their EFTPS enrolment or were still making deposits by coupon instead of electronically.

But TIGTA found that in a sample of 96 high priority FTD alert cases, revenue officers were often not assigned the alerts promptly and, when they were, did not always make timely contact with the taxpayers concerned.

“I am pleased by the IRS’s action to communicate and educate business taxpayers about this new regulation, but the Service must then ensure that revenue officers contact all business taxpayers about problems in a timely manner, since business taxpayers who are not contacted timely accrue more interest and penalties,” said J Russell George, the Treasury Inspector General for Tax Administration

The IRS said it agreed with, and would implement steps to comply with, TIGTA’s recommendations that it should create rules for timely group manager assignment of FTD Alerts to revenue officers and emphasise to group managers the need to ensure that revenue officers contact business taxpayers within 15 calendar days of FTD Alert assignments.



more across site & shared bottom lb ros

More from across our site

Brazil's tax system is being reshaped by VAT , pillar two and TP reform. Fallet explains why those changes convinced him to lead a new practice
The agreement with Daribatech, alongside recent high-profile investment in talent, suggests the firm is gearing up for a significant push in the region
Several factors have led to a steady transition of TP work away from traditional advisers and towards full-service law firms, DLA Piper’s new TP leader says
Julian Balson's departure from EY's Tier 1 tax controversy practice for lower-ranked Fieldfisher represents one of the more eye-catching UK hires of the year
Former IRS commissioner Danny Werfel argues that the biggest obstacle to AI adoption in tax is not technology, but trust, and introduces a practical AI risk framework to help
Howell takes a deep dive into how he led the landmark PepsiCo dispute, discusses the ATO's enforcement priorities, and emphasises KordaMentha's market ambitions
Global tax leader David Linke said that the TaxSim gaming programme could replace aspects of traditional face-to-face learning
Former ATO economist Craig Silverwood is joining from Australian firm MinterEllison
The rebranding, which will see changes to signage, visual identity and digital properties, is scheduled to be completed by the end of this year
The software space was previously more fragmented, but that model is becoming more difficult to sustain as tax administration becomes increasingly digitised
Gift this article