The Treasury Inspector General for Tax Administration (TIGTA) found that the Internal Revenue Service (IRS) expanded taxpayer chat services without establishing reliable performance measures or data controls.
In a June 15 report, TIGTA concluded that IRS management “has not taken sufficient steps to evaluate the effectiveness” of the Automated Collection System (ACS) function’s live chat and chatbot services. The ACS function within the Small Business/Self-Employed (SB/SE) Division primarily resolves taxpayer inquiries related to balances due or delinquent returns.
The IRS first piloted live chat in 2017 and added automated chatbots in 2021 as part of broader efforts to expand digital services under the Taxpayer First Act and other modernization initiatives.
The agency made the live chat program permanent in June 2025 and utilized Inflation Reduction Act funding to support the tools. According to the watchdog, the IRS spent about $7.2 million in Inflation Reduction Act funding on chatbot and live chat applications during fiscal years 2024 and 2025.
The TIGTA audit examined whether the IRS chatbot and live chat applications provide effective and efficient service to help taxpayers meet their tax obligations. TIGTA found that the IRS lacks performance measures for the ACS chat applications and relies on data that contains significant inaccuracies.
Specifically, the report identified statistical anomalies showing some employees handling as many as 603 simultaneous chats, despite system controls limiting live assistors to three concurrent chats. TIGTA said those discrepancies stem in part from calculation errors in key performance metrics and weaknesses in data collection practices.
The watchdog also found that more than half of the reported live chats during calendar years 2023 and 2024 were unresolved. TIGTA identified 635,684 live chats during that period, with only 290,181 classified as resolved.
However, auditors cautioned that data quality issues prevented them from determining precise resolution rates. The IRS also lacks sufficient information to determine why many chats were abandoned, disconnected, or referred back to IRS phone lines.
Customer feedback mechanisms were another area of concern. TIGTA reported that the IRS has not offered taxpayers a survey after live chat sessions since September 2022.
However, the IRS does offer a simple two-question survey when a taxpayer ends an automated chatbot session. It does not allow the taxpayer to provide written feedback.
At the end of the survey, “the final chatbot response states, ‘Thank you for your feedback. We are collecting the information to help improve our service.’ However, when we requested the results of these two survey questions, IRS officials stated that they do not collect or review these responses,” the report noted.
Office of Management and Budget guidance requires agencies to gather and assess customer feedback for designated public services. The ACS chatbot and live chat applications are identified as designated services, according to the TIGTA report.
The audit also found gaps in employee oversight. TIGTA determined that ACS management “only conducted nonevaluative performance reviews of live assistors since they considered live chat to be a pilot program.”
In addition, auditors found that 24 of 40 sampled live assistors worked multiple chats concurrently, which TIGTA said could increase the risk of service quality issues and inappropriate disclosure of taxpayer information.
TIGTA also identified shortcomings in the chatbot itself, including 29 responses that lacked sufficient information and 44 keyword searches that produced inadequate responses or were not recognized by the system.
The report makes nine recommendations, including establishing performance measures, validating chat application data, improving employee reviews, expanding customer feedback collection, and enhancing chatbot functionality.
IRS management agreed with all nine recommendations and said it has already implemented corrective actions for several of them.