0123 Publ 5382 (PDF) — verbatim text

Official source: IRS Forms, Instructions & Publications (https://www.irs.gov/pub/irs-pdf/p5382.pdf), retrieved 2026-10-03. U.S. Government work (17 U.S.C. § 105).

Contents

Acting Commissioner’s Message

importance of the agency and our

perform its vital functions and be

defense.

also wrapped up disbursement of

tax filing season, but we continued to

“We continued our efforts to enhance service for all taxpayers, including people in diverse and under-served communities.”

– Acting Commissioner Doug O’Donnell

About the Internal Revenue Service

History

established the Bureau of Internal

History Timeline at www.irs.gov/ irs-history-timeline.

Mission

meet their tax responsibilities and enforce the law with integrity and fairness to all.

Vision

collaborative partnerships.

Strategic Plan Overview

received and a 22.0 percent increase in returns being filed electronically.

Additionally, we received more than 33.5 million business returns, an increase of over 13 percent from the same time last year. Of the total business returns filed, 25.5 million were filed electronically and 8.1 million were filed on paper.

one for taxpayers, tax professionals and for the IRS. For that reason, we worked diligently to provide taxpayers with tools to help them navigate the filing season.

For example, early in the filing season, we sent out more than 250 million letters

Economic Impact Payment for which they were eligible in 2021 and those who needed to reconcile advance payments of the Child Tax Credit on their

returns.

As FY 2022 ended and FY 2023 began, the IRS continued to make major progress on the inventory, a critical step to be ready to serve taxpayers during the 2023 tax filing season.

with an acceptance rate exceeding 57 percent. We estimate this feature has saved taxpayers more than 1.7 million hours. As FY 2022 closed, work continued to add 5,000 new customer service representatives to our phone lines. Extra funding means that the IRS will have a record number of employees on the phones helping taxpayers in 2023

asked questions. The IRS added voice bots for the advance Child Tax Credit toll-free line in February to provide similar assistance to callers who needed help reconciling the credit payments on their 2021 tax return. These voice bots have been used more than 9 million times with approximately 4 million taxpayers receiving successful self-service.

for military members on 25 military bases in the U.S., Europe and Asia.

To encourage volunteerism generally in the VITA/TCE program, during FY 2022 the IRS implemented a more streamlined volunteer recruitment process, allowing volunteers to use the IRS.gov portal to express their interest in volunteering and receive an invitation to attend a

to easily determine their potential eligibility for the credit. We provided translations for the tool so it could be used by taxpayers who speak Spanish, Haitian Creole, Russian, Simplified and Traditional Chinese.

We also made improvements to the Tax Withholding Estimator, to better enable users to perform a “paycheck checkup”

Facebook. In the last two years, our subscriptions to the IRS multilingual channel have nearly doubled. We’ve established new YouTube playlists in Chinese and Vietnamese and continue to have a strong social media presence in Spanish.

employees, Susan Leon and Teri Coley, with examples of new large-print IRS notices

in alternative media formats.

based defenses with a Zero Trust Model, which presumes that no actor, system, network, or service can be trusted – everything must be authenticated.

The IRS enhanced Vulnerability and Threat Management (VTM) capabilities

volunteer orientation session. This

through IRS.gov during the year.

high school participation in the VITA program. We invited high school

program in their schools.

efforts like VITA and TCE.

Improving Service to Diverse Communities

the IRS serves taxpayers in diverse

are most comfortable using. We are

of all taxpayers, including those who have limited English proficiency.

In FY 2022, we built on the 2021 milestone accomplishment of providing the Form 1040 in Spanish with a number of new offerings. For example, we completed conversion of 34 Spanish

conversation with a certified volunteer and a taxpayer.

Mississippi Delta Outreach Initiative. A key example of our efforts to reach out to diverse communities was the strategy launched in FY 2022 to educate taxpayers in Louisiana and Mississippi

interview with agents where no biometric data – including facial recognition – is required.

Tax-related Identity Theft. Along with protecting IRS systems, in FY 2022 we maintained our focus on protecting taxpayer data from the crime of tax

has been the work of the Information Sharing and Analysis Center (ISAC), formed by Security Summit partners in 2017. During FY 2022, the ISAC continued facilitating information sharing and analytics necessary to detect, prevent, and deter activities related to stolen identity refund fraud.

we continued our efforts to shut down abusive tax shelters and stop promoters of these schemes. It’s very important that we improve our ability to identify and deter promoters, and that we do so quickly – before they are able to widely market their transactions, as we have seen with syndicated conservation easements and micro-captive insurance.

patterns and trends continue to emerge in international tax avoidance schemes and cross-border transactions, particularly involving cryptocurrency. These activities have heightened our concern regarding the lack of tax compliance by individuals and entities with an international footprint. As international tax and money laundering

know about, but to finding the

stop those promoters quickly and efficiently.

There have been some notable successes during FY 2022. One

address abusive syndicated

the abusive nature of the underlying deduction in these cases. While continuing to investigate these

transactions and want to come into compliance. In other matters we have been pursuing fraud penalties, when appropriate.

Another great example involves abusive micro-captive insurance transactions. The IRS has been aggressively challenging these transactions in court, and in May 2022, an Appeals Court

is the work performed by the IRS Whistleblower Office. This office takes the lead in working with whistleblowers

people with firsthand knowledge of non-compliance who are willing to come forward and share what they know with the IRS so we can investigate it when warranted.

collaborative work through our 11 international attaché posts included our online “Around the Globe” campaign that highlighted activities from our attaché posts around the world, which received more than 100,000 views. The campaign featured operational results as well as summits and press conferences with partner countries including Palau,

information to efficiently identify potential transfer pricing issues. Our compliance enforcement strategy recognizes the importance of leveraging recent judicial guidance related to transfer pricing issues. LB&I’s efforts to enhance transfer pricing risk assessment and compliance strategies are complemented by equally robust efforts to prevent and resolve

CI investigates potential criminal violations of the Internal Revenue Code and related financial crimes to enforce accountability and maximize deterrence. This includes money laundering, currency violations, tax-related identity theft fraud and terrorist financing that adversely affects tax administration. Using its unique authority and financial

Newark Field Office Criminal Investigation special agents participated in a Police Unity Tour to raise awareness about law enforcement officers who died in the line of duty.

expertise, CI contributes to important national law

of tax fugitives, CI launched an initiative to identify fugitives who had absconded to Mexico and nearby countries, resulting in the location of 79 criminal fugitives and apprehension of eight by the end of the fiscal year. Additionally, CI joined Taskforce Kleptocapture in March 2022 to target Russian oligarchs and others who evaded sanctions. CI also

education, outreach and coordinated cross-functional publicity. During FY 2022, there were 175 RPP criminal investigations initiated, 93 prosecutions recommended and 129 sentencings, with an incarceration rate of 69%.

Cyber Crimes. The CI Cyber Crimes unit collaborates with other federal law enforcement agencies to identify the

of the Treasury to require brokers to report transactions in digital assets under IRC section 6045, added digital assets to existing reporting rules for transactions in excess of $10,000, and included digital assets in the types of assets for which the Secretary can require transfer statements under section 6045A for broker-to-broker and broker-to-non-broker transactions.

be unable to work during the pandemic. Working collaboratively with teams of seasoned enforcement employees who identified the questionable claims, OFE investigated the suspect claims and administratively disallowed the claims and/or referred cases for further investigation.

(FBAR) program. In collaboration with Research, Applied Analytics and Statistics (RAAS), SB/SE will analyze the data to enhance current case selection and identification methods.

topics ranging from tracing digital assets to basis computation and taxation treatment of virtual currency, nonfungible tokens and other digital assets. The IRS is expanding the depth and breadth of fraud detection to encompass these new technologies by acquiring the latest tools, training and expertise needed to ensure tax compliance in this rapidly evolving area.

culture that encourages creativity, innovation and strategic thinking. The team was instrumental in the creation and implementation of revamped web tools, process maps and other innovations to reshape and improve hiring processes. In addition, IRS Next oversaw the documentation of the consolidated Servicewide current state

continue to use it to hire up to 10,000 new hires through December 2023. This effort is already making a difference, helping us to hire 5,000 new telephone assistors in a few weeks in late 2022 – a process that took eight months the previous year.

November 2021, we started an innovative pilot program to help people in communities across America rise out of poverty by pursuing a career at the IRS as contact representatives, individual taxpayer assistant specialists and compliance personnel. We started in the Mississippi Delta region, an area of the country that currently has the

the January 2021 Report to Congress. Actions to advance the strategy included:

Designing the IRS University (IRSU) structure in collaboration with agencywide leadership.
Establishing an enterprise-wide approach to employee development and an enterprise-wide framework that

employees throughout all stages in their career. For example, the IRS established the Information Technology Workforce Strategy and executed on numerous activities to provide employees with the technology skills and training needed to support the future of tax administration. Key activities included a renewed IT-wide focus on training to improve

appropriate processes, delivery styles, formats, and practical application.

Employee Engagement. The IRS continued to implement various initiatives to engage employees. We developed a FY 2022 - 2025 Leadership Engagement Action Plan (LEAP) with some initiatives occurring in FY 2022

for Electronic Revenue Communication Advancement Board of Directors. These meetings provide a strategic forum to share high-level key messages and emerging issues and gather feedback.

As important as our partners in the tax community are, the IRS has continued building relationships with organizations outside of traditional tax communities

and elsewhere – government entities (international, federal, state, local and tribal), universities and volunteer organizations. During FY 2022, we continued to take steps to strengthen and expand our partnerships. The IRS continued to strengthen partnerships with other federal agencies such as the Department of Labor and the Pension Benefit Guaranty Corporation to improve tax compliance and the taxpayer

their return.

To increase awareness of the Earned Income Tax Credit and other important credits, the IRS and various national and local partners collaborated to hold the 16th annual Earned Income Tax Credit Awareness Day on January 28, 2022. Traditional media events as well as activities on social media helped us reach the broadest possible range of

organizations that serve multilingual taxpayers. These events included the Spanish Hearing All Voices event for the Hispanic community and the African Development Center/IRS Small Business Listening Session for the Somali community. Increasing partnerships in this critical area will have long-lasting effects in improving our service to all taxpayers.

an IRS recruiting event in Houston.

taxpayers is our new Taxpayer

identifies opportunities to make

taxpayers and the tax professional community.

During FY 2022, the Taxpayer

agency-wide taxpayer experience guidelines and expectations.

focuses on six areas:

Expanding Digital Services
Integrating digital tools with other

experiences

Undertaking proactive outreach and education by providing the information that taxpayers are seeking at the time, in the language, and through the method they prefer
Building on our longstanding and successful partnerships, to ensure we grow and nurture the community of partners

This is a major priority for the agency going forward.

Enterprise Case Management (ECM). The IRS’s ECM initiative is a major part of our agency’s transformation. ECM allows us to modernize key IRS business processes and migrate them to a common case management platform. We can then decommission as many

with these organizations.

enter IRS facilities. Despite challenges presented during COVID, the IRS was able to provide installation services and oversight to assure protection of taxpayer information.

Human Capital. Our ongoing efforts to support our workforce and improve the employee experience include increasing efficiencies in our human capital

Creating the comprehensive Data Warehouse that integrates data from multiple contract-writing systems and data repositories into a single platform, making it easier to access current and historical data. This has resulted in improved workload forecasting and tracking as well as improved obligation tracking.

The IRS received the 2021 Public Sector Innovation award for innovating IRS IT services through robotics process automation and Artificial Intelligence-based operations.

employees to focus on higher valueadded work, thereby cutting costs. During the first quarter of FY 2022 alone, the IRS deployed 16 attended automations for various IRS functions.

Cloud Technology. We continued to leverage the benefits of cloud technology in FY 2022, including

storage.

taxpayer account processing as well as data-centric technologies to improve service to taxpayers. CADE 2 is being developed in several stages. In FY 2022, we remained focused on the most critical part of this modernization effort —reengineering the core components of the legacy tax processing system (the Individual Master File). We have

This includes online accounts, secure two-way communications, text chat, expanded ability to check the status of returns and payments, and more. This area will be another major focus for the IRS going forward following passage of the Inflation Reduction Act, which will build off our successes in FY 2022.

improved the identity verification process to make it more secure and compliant with regulatory requirements. We also gave taxpayers the option to make a same-day payment to the IRS from their bank seamlessly through their online account, including payments for a balance, payment plan, extension or estimated taxes. Another improvement

and Form 8865, Return of U.S. Persons With Respect to Certain Foreign Partnerships, versions of the K-2 and K-3 schedules. To help communicate these new schedules, we met with the Council for Electronic Revenue Communication Advancement and third-party software companies about updates to the schedules and deployment dates.

profile page within Tax Pro Account where they can manage preferences related to their account and can opt in or out of email notifications for approved authorizations.

Enterprise Digitalization Initiative. Enterprise Digitalization facilitates our efforts to enable a digitally driven agency, which will improve operations

IRS Forms Online. A critical aspect of our modernization efforts involves our work regarding IRS forms and publications. Activities continue with the goal of implementing adaptive forms that are mobile, fillable and can be submitted directly to the IRS. During FY 2022, we worked to implement a hybrid staffing

Improvements in Data

the groundwork for continued

Tools and Services.

work begun in 2021 for the Large

The LPC team has expanded risk

and utilize far more risk attributes

Looking to the Future— Fiscal Year 2023

taxpayer service and technology.

The type and rule above prints on all proofs including departmental reproduction proofs. MUST be removed before printing.