A representative for the Department of Government Efficiency (DOGE) on Thursday said that the IRS’ modernization program was significantly over budget and behind schedule.
Levels CEO and U.S. Treasury special advisor Sam Corcas told host Laura Ingraham on “The Ingraham Angle” that he has been brought in by President Donald Trump and Tesla CEO Elon Musk’s DOGE to “look at the IRS modernization program in particular, as well as the operations and maintenance budget.”
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“The IRS has some pretty legacy infrastructure,” he explained about the modernization program. “It’s actually very similar to what banks have been using. It’s old mainframes running COBOL and Assembly. And the challenge has been, how do we migrate that to a modern system? Virtually every bank has already done this, but we’re still using a lot of those same systems, and typically in industry, it takes a few years, maybe a few hundred million dollars, and we’re now 35 years into this program.”
Corcas claimed the “huge” IRS modernization program was 30 years behind schedule and “already $15 billion over budget.” It was supposed to be delivered in 1996, he said.
He did, however, express optimism about modernizing the IRS, saying the agency has “quite a lot of software talent,” but they “haven’t been in a position to be empowered to make those decisions.”
According to Corcas, the IRS processes “about the same amount of data” as a mid-sized bank, but uses significantly more people and resources to do it.
A midsize bank “will have somewhere between one and 200 people in IT, and it will have an operations and maintenance budget in the $20 million a year range,” Corcas told Ingraham. Meanwhile, he said the IRS employs 8,000 people in IT and “our operations and maintenance budget is $3.5 billion a year.”
“I don’t really know why yet, but I will tell you that 80% of that budget goes to contractors and licenses,” he added.
Treasury Secretary Scott Bessent, appearing with Corcas on “The Ingraham Angle,” called IRS consultants and contractors a “problem,” likening them to boa constrictors that have “constricted themselves around our government.”
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Corcas said the “main focus” was “how do we turn this around,” noting the IRS was “way beyond any reasonable cost for what you would expect of a private company” for such a modernization program.
Roughly $1.5 billion has been stripped from the IRS modernization budget so far, he told Ingraham.
Overall, DOGE is working to significantly pare back spending and boost efficiency across the federal government, with a goal of reducing spending by $2 trillion.
It claimed total estimated savings of $115 billion on its website as of Friday. That total, DOGE claimed, equated to $714.29 per taxpayer.
Last month, DOGE sought tips from the public about waste, fraud and abuse at numerous federal agencies by setting up DOGE affiliate social media accounts.
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Trump used an executive order on the day he became the 47th president to officially establish DOGE. The Musk-led initiative is expected to finish its cost-cutting efforts by early July 2026.
Eric Revell contributed to this report.
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