• IRS modernization program is 30 years behind schedule and $15B over budget.
  • Agency still relies on outdated COBOL and Assembly-based mainframes.
  • Political scrutiny intensifies as DOGE takes charge of addressing inefficiencies.

IRS Modernization: A $15B Overspend

The IRS's Business Systems Modernization program, originally slated for completion in 1996, is now approximately 30 years behind schedule and $15 billion over budget, according to Sam Corcas, a U.S. Treasury special advisor. Corcas, appointed by President Trump and Elon Musk's Department of Government Efficiency (DOGE), revealed these figures during a March 2025 appearance on Fox News' "The Ingraham Angle."

Outdated Tech Haunts Tax Collection

While most banks transitioned to modern systems years ago, the IRS continues to operate on antiquated mainframes running COBOL and Assembly—languages largely phased out by the private sector. "This isn't just outdated; it's museum-grade," one anonymous Treasury official remarked. The agency's tech debt has compounded operational risks, with system failures during peak filing seasons becoming increasingly common.

Funding Cuts Amid Rising Costs

The Inflation Reduction Act initially earmarked $80 billion for IRS upgrades over a decade, but Congress clawed back $20 billion by April 2025. Of the remaining funds, only $4.8 billion was allocated specifically to the Business Systems Modernization program—now dwarfed by its $15 billion cost overrun. DOGE officials confirm they're auditing all line items, with one insider noting, "Every dollar here could fund three SpaceX launches."

Political Lightning Rod

The revelations have reignited debates about government efficiency, with DOGE framing the overruns as symptomatic of broader bureaucratic bloat. When pressed for solutions, Corcas hinted at "public-private partnerships" but provided no specifics. The IRS declined to comment, though a leaked internal memo acknowledged "challenges in talent retention" as engineers flee for tech firms.

Correction: An earlier version overstated the total funding reduction from the Inflation Reduction Act. The correct figure is $20 billion, not $25 billion.