Tax Filing as Easy as Mobile Banking: Creating Product-Driven Government
Americans trade stocks instantly, but spend 13 hours on tax forms. They send cash by text, but wait weeks for IRS responses. The nation’s revenue collector ranks dead last in citizen satisfaction. The problem isn’t just paperwork — it’s how the government builds.
The fix: build for users, not compliance. Ship daily, not yearly. Cultivate talent, don’t rent it. Apple doesn’t outsource the creation of its products; the IRS shouldn’t outsource taxpayer experience. Why?
The goal: make taxes as easy as mobile banking.
The IRS, backed by a Congress and an administration that truly wants real improvements and efficiencies, must invest in building its tax products in house. Start with establishing a Chief Digital Officer (CDO) at the IRS directly reporting to the Commissioner. This CDO must have the authority to oversee digital and business transformation across the organization. This requires hiring hundreds of senior engineers, product managers, and designers—all deeply embedded with IRS accountants, lawyers, and customer service agents to rebuild taxpayer services. This represents true government efficiency: redirecting contractor spending to fund internal teams that build what American taxpayers should own rather than rent.
This is about more than broken technology. This is a roadmap for building modern, user-centric government organizations. The IRS touches every American, making it the perfect lab for proving the government can work.
Transform the IRS first, then apply these principles across every agency where citizens expect digital experiences that actually work.
Challenge & Opportunity
It’s April 15th. For the first time, you’re not fretting.
You finished filing your taxes on a free app. It took 15 minutes. Your income? Already there. Your credits? Pre-calculated and ready to claim. Your refund? Hitting your bank account tomorrow.
For millions around the world, swift, painless tax filing isn’t a dream. It’s the norm. It should be for Americans, too.
But in the U.S., the IRS experience is still slow, opaque, process-heavy, and frustrating. Tax filing is one of the few universal interactions Americans have with their government—and it’s not one that earns much trust.
It doesn’t have to be this way. We were on the path to delivering that with IRS Direct File and needed to recommit. To deliver wildly easier taxes for Americans, we can, and must, build an IRS that meets high modern expectations: fast, transparent, digital-first, and relentlessly taxpayer-focused.
The Diagnosis
Each year, the IRS collects more than 96% of the revenue that funds the federal government—$5.1 trillion supporting everything from Social Security, defense, infrastructure, veterans’ services, and investing in America’s future.
The quote from Justice Oliver Wendell Holmes, carved into the limestone face of the IRS headquarters in D.C., captures the spirit well:
“Taxes are what we pay for civilized society.”
It is not only essential to the functioning of government—it is also a major way most Americans interact with it. And that experience? Frustrating, costly, and confusing. According to a recent Pew survey, Americans rate the IRS less favorably than any other federal agency. The average taxpayer spends 13 hours and $270 out of pocket just to file their return.
The core problem: The IRS needs to be user-focused.
Despite the stakes, the IRS operates far behind what Americans expect. We live in a world where people can tap to pay, split bills by text, or trade stocks in slick apps. But that world does not include the IRS.
A staggering 63% of the 10.4 billion hours Americans spend dealing with the federal government are consumed by IRS paperwork. But much of the source of that pain isn’t the IRS, but Congress with the crushing complexity of decades long tax code changes, sedimented on top of each other. This year was no different. The “One Big Beautiful Bill” runs 331 pages, with large swaths devoted to new, intricate tax changes.
Dealing with the IRS still often involves paper forms, long phone waits, chasing down documents, and confusing processes.
If you’ve dealt with the IRS for anything beyond filing, it feels impossible to get a task finished. Will someone pick up the phone? Can I get an answer to my questions and resolve my situation? Would I expect the same answer if I talked to someone else? Last year the IRS answered just 49% of the 100 million calls it received, including automated answering.
This underperformance is beyond outdated technology—it’s structural and institutional. The IRS’s core systems are brittle and fragmented. Ancient procurement rules and funding constraints have made sustained modernization nearly impossible. Siloed organizations sit within siloes. In place of long-term investment, the agency leans heavily on short-term contractor fixes, band-aids applied to legacy wounds.
This complexity has stymied scaled change.
The root cause: The IRS has never treated world-class technology and product development as mission-critical capabilities core to its identity, to be hired, owned, and continually improved by internal teams focused on user outcomes.
A modern service agency builds end-to-end experiences for users—from pre-populating data through to filing and refunds. Empowered teams building these features have a holistic viewpoint and control over their service to ensure taxpayers are able to repeatedly and reliably complete their task.
Today’s reality is different: federal agencies like the IRS treat technical and product expertise as afterthoughts—all nice-to-haves that serve bureaucratic processes rather than core capabilities essential to their mission. Strategy and execution get outsourced by default. This creates a growing divide between “business” and “IT” teams, each lacking a deep understanding of the other’s work, despite both being critical to delivering services that actually function for taxpayers.
This outsourcing has hollowed out the agency’s internal technical capacity. Rather than building technical competency in-house, and paying that talent a salary approaching private companies, the IRS grows more dependent on vendors. It no longer knows what it needs technically, what questions to ask or which paths to pursue. Instead they must trust the vendors–companies financially incentivised towards ballooning scopes, lock-in, and complexity.
The result: a siloed experience that mirrors a siloed organization, one that is risk-averse, paper-heavy IRS, too slow to meet modern expectations.
The agency approaches service delivery as a compliance and bureaucratic process to digitize, rather than a product to design. “Never ship your org-chart” is a common refrain you’ll hear at tech companies, to explain how products tend to take on the communication style of their builders. Yet IRS product faultlines visibly follow its org structure and thus fail to deliver a holistic experience.
There were bright spots. Direct File showed what’s possible when empowered teams build for users. A dead simple idea: let Americans file taxes directly on the IRS site was a reality. It worked. It was well regarded. In surveys, users beamed about Direct File: 9 out of 10 gave it an “excellent” or “above average” rating, 74% said they preferred it over what they used before, and 86% said it increased their trust in the IRS.
The government actually delivered for its citizens, and they felt it.
But it didn’t last. The project was abruptly dismantled due to political ideology, not taxpayer experience or feedback.
Many of the people with the technical skills and vision to modernize the IRS have left, often without a choice. The agency will likely slide further backward—into deeper dependence on systems built by the lowest bidder or those currying political favor, with poorer service and diminished public trust in return.
We’ve seen this up close.
Both of us worked at The White House’s technology arm; the U.S. Digital Service. One of us helped lead Direct File into existence and built the Consumer Financial Protection Bureau’s digital team. The other previously led Google’s first large language model products and prototyped AI tools at the IRS to streamline internal knowledge work.
In our work at the IRS, we witnessed how far the agency must go. Inside the IRS Commissioner’s office, with leaders across the agency, we built a collaborative digital strategic plan. This memo details those proposals since left by the wayside after seven different IRS commissioners rotated in the seat, just this year.
The IRS needs more than modernization. It will need a systemic rebuild from:
- compliance, to user-centered design and product thinking
- vendor dependence to empowered internal product teams
- once-a-year panic to real-time, year-round services
- fragile mainframes to composable platforms and APIs
- waterfall contracting to iterative, continuous delivery
We’re sharing these recommendations for a future Day One—when there’s a refocus on rebuilding the government. When that day comes, the blueprint will be here: drawn from inside experience, built on hard lessons, and focused on what it will take to deliver a digital IRS that truly works for the American people.
What we need is the mandate to build a tax system that makes Americans think: “That was it? That was easy.”
Plan of Action
The IRS must rebuild taxpayer services around citizen needs rather than compliance and bureaucratic processes. This requires in-housing the talent to strategically build it. We propose establishing a Chief Digital Officer directly reporting to the Commissioner, with the authority to oversee digital and business transformation across the organization, hire hundreds of senior engineers, product managers, and designers. The goal, a team empowered to deliver a tax-filling product experience that meets modern expectations.
The Products
Build for Users, Not Internal Compliance
We’ve become accustomed to a user-focused fit-and-finish in the app era. Let’s deliver that same level for taxpayers.
It all starts around building a digital platform that empowers taxpayers, businesses, and preparers with the information, tools and services to handle taxes accurately and confidently. A fully-featured online account becomes the one-stop, self-service hub for all tasks. Taxpayers access their complete tax profile, updated in real-time, with current data across income sources, financial institutions, and full tax history. The system proactively recommends tax breaks, credits, and withholding adjustments they’re eligible for.
Critically, this can’t be built in a vacuum. It requires rapid iteration with users as part of a constant feedback loop. This digital platform runs on robust APIs that power internal tools, IRS public sites, and third-party software. Building this way ensures alignment across IRS teams, eliminates duplicate efforts, and lifts the entire tax software ecosystem.
This is what we need to build for Americans:
Online tax filing: From annual panic to year-round readiness
Reboot Direct File. Stop forcing everything into tax season. Let taxpayers update information year-round—add a child, change addresses, adjust withholdings, upload documents. When April arrives, their return is already 90% complete.
This is a natural evolution of Direct File and the existing non-editable online account dashboard into a living, breathing system taxpayers optimize throughout the year. And not just for individuals—this should be extended to businesses—reducing this burden for as many filer types as possible.
Pre-populated returns: Stop making people provide what the IRS already knows
The IRS already has W-2s, 1099s, and financial data. Use it. Pre-populate returns to cut filing time from hours to minutes. Deliver secure APIs so any tax software can access IRS data (with taxpayer permission), and use machine learning to flag issues including fraud before submission. This increases accuracy, reduces errors, and spurs competition by making it easy to switch between tax-filing programs.
Income verification as a service: Turn tax data into financial opportunity
The IRS sits on verified income data that could help Americans access government services, credit, mortgages, and benefits like student aid. Instead of weeks-long transcript requests, offer instant verification through secure APIs. This creates a government-backed source alongside credit bureaus, increases financial access, and reduces paperwork across all government services.
Tax calculator as a platform: One source of truth
Every tax software company recreates the same calculations, each slightly different. Across the organization, the IRS itself uses multiple third-party tax calculators in audits. This should be a core, integral service the IRS offers—build a definitive tax calculator as an API, the single source of truth that internal audits and checks use, and external software can access or run on their own. Make it transparent, auditable, and open source. Put up cash “bounties” to encourage the public to find bugs and errors and invite taxation-critics to review the code. Use generative AI to aid IRS accountants, lawyers and engineers translate tax law changes into code–speeding the roll out of Congressional tax changes.
When everyone calculates taxes the same way the IRS does, errors vanish. When everyone can see how the IRS does it, trust grows.
Modern MeF: From submission pipe to intelligent platform
Today’s Modernized e-File (MeF) is barely modern—it’s a dumb pipe that accepts tax returns and hopes for the best. Transform it into intelligent infrastructure that validates in real-time, catches errors immediately (not weeks later in confusing notices), and stops fraud before refunds are deposited. Build it like a real API, not XML dumps. Enable multi-part submissions so taxpayers can fix mistakes without starting over. This isn’t just a technical upgrade—it’s the foundation that makes every other improvement possible.
The Process
Ship Daily, Not Yearly
Taxpayer-first product development
The IRS is the single largest interaction point between Americans and their government. Every improvement saves millions of hours and builds trust. This requires abandoning bureaucratic processes for product thinking.
Build with taxpayers from day one through constant user testing and feedback loops. Organize around taxpayer journeys—”I need to update my withholdings” or “I’m checking my refund”—not org charts.
Measure what matters: time-to-file, satisfaction scores, error rates, not only compliance metrics. Internal Objectives and Key Results planning makes priorities clear and syncs the organization towards focused goals. Publish Service Level Objectives on external products to ensure we target creating systems that others can confidently rely and build on.
Give full-stack product teams the authority to make integrated technical, design, policy and legal decisions together. Staff these teams with internal technologists embedded alongside accountants and lawyers in functional organizations, building IRS competency while reducing contractor dependence. Today’s IRS is highly siloed across functions with authority so fragmented it’s unclear who “owns” what. Yet go to any top tech organization and you’ll see what we’re pushing for: aligned and cross-functional teams whose job is delivering with clear ownership. Inherently we’re pushing for more than a new team, we’re factoring out unclear ownership in general away from IT and Business Divisions.
When teams own outcomes, we can better ensure taxpayer experience transforms from painful to painless.
API-first architecture
The IRS is fundamentally a data organization, yet information flows through siloed systems that can’t talk to each other. Amazon solved this with a simple mandate: all teams must expose their data and communicate through APIs. (This mindset set in motion the seeds of Amazon Web Services, the company’s most profitable division).
The IRS needs the same revolution.
Every team exposes data and functionality through standardized REST APIs—no direct database access, no per-department clones of the data, no exceptions. Design every API to be externalizable (with strong access controls) from day one, unlocking government APIs to become platforms for innovation. When systems communicate through versioned APIs instead of tangled dependencies, teams can ship improvements daily without compromising everything else. This isn’t just technical architecture—it’s how modern organizations move fast without breaking things.
The People
Cultivate it, Don’t Outsource It; Build a Delivery Culture
A digital IRS that delivers for Americans cannot be built by the lowest bidder. Its core capability isn’t digitized forms–it’s people who can understand taxpayers’ needs, imagine solutions, design thoughtfully, ship them fast, listen to users, and keep improving based on feedback.
Silicon Valley understands this instinctively on two fronts. The fight for great engineers is the fight to build teams that can deliver great products. And two, no leading tech company outsources its own R&D. Delivering well-functioning and beloved products requires tight ownership of the product iteration loop.
Businesses long learned to never outsource a core competency. OpenAI would never outsource the training of its models, Apple its industrial design, Google its search algorithm, or Facebook its social graph. The same should be true for the IRS.
Yet, despite accepting 93% of its tax returns digitally, it still does not consider itself to be a digital-first agency. Building great teams is inseparable from building great taxpayer experiences. For decades, the agency has outsourced its technical mission and vision.
What we witnessed at the IRS was often vendor theater. Consultants transformed routine meetings into sales presentations that should have been dedicated to improving the products. Solutions specialists added layers of proprietary middleware, despite readily available enterprise-grade open source solutions running on commodity servers could easily meet the objectives. All of this unfolded within an organizational culture where securing contracts took precedence over delivering meaningful outcomes. Contracts that, of course, cost multiples more than the price of a competent internal team.
Commodities like cloud infrastructure or off-the-shelf software that serve broad, generic needs should absolutely be acquired externally. But the IRS’s critical, taxpayer-facing products—the systems at the heart of filing, payments, and taxpayer accounts—must be built and owned internally. There is only one agency that collects taxes for the United States of America.
When everything is handed to vendors, the IRS sends more than money out the door; it loses institutional memory, technical craft, quality systems, and the ability to move quickly. A modern IRS cannot be built on rented skills.
Talent: Build a Permanent Product Core
This transformation starts with the people: build and keep an in-house corps of top-tier technologists—engineers, product managers, designers, user experience researchers—working in small, empowered, cross-functional teams hand in hand with fellow IRS accountants, auditors, customer service representatives and lawyers. Not a handful of digital specialists scattered in a bureaucracy as it was, but several hundred people whose full-time job is delivering and evolving the IRS’s core taxpayer experiences and services.
- Create a dedicated Digital Profession inside the IRS, led by a Chief Digital Officer with the authority to hire, fire, and shape teams and technology stacks.
- Break the straitjacket of outdated civil service rules by creating specialist pay bands to compete for top talent like the CFPB has done.
- Empower cross-functional teams to ship without endless escalation. Start small, test early, iterate quickly, and make product decisions by those close to the work.
Funding: Invest in Teams, Not Projects
Current funding locks the IRS into one-off projects that end when the money runs out, leaving no path for iteration. A product-centered IRS needs enduring funding for enduring teams. Long-lived services, not short-lived milestones. This should be no surprise for a tax organization. There are two certainties in life; death and taxes. We should properly set ourselves up to manage the latter.
- Fund continuous development rather than one-and-done “delivery.”
- Tie funding to taxpayer outcomes like faster filing, fewer errors, higher satisfaction, instead of compliance checklists.
- Secure multi-year budgets for core product teams so they can improve services year-round, not scramble for appropriations each cycle.
This shift will reduce long-term capital costs and ensure that every dollar invested keeps improving the taxpayer experience.
Quality & Standards: Build Once, Build Right
Owning our products means owning their quality. That requires clear, enforceable service standards, like performance, usability, scalability, and accessibility, that every IRS product must meet.
- Establish service performance benchmarks and hold teams accountable to them. These should be highly taxpayer centric; time to file, support response time, ease of use.
- Create communities of practice inside the organization to share patterns, tooling, and lessons learned across the agency.
- Apply spend controls that tie contract renewals to measurable outcomes and prevent redundant vendor builds.
Culture Eats Strategy: Time to Invest in a Delivery Culture
“Culture eats strategy for breakfast,” as Peter Drucker famously said. Yet government agencies too often treat culture-building as off-limits or irrelevant. This is backwards. Creating a shared, collaborative culture centered on delivery isn’t just important; it’s the foundation that makes everything else possible. The hardest and most critical step is investing in people. Give employees space to collaborate meaningfully, contribute their expertise, and take ownership of outcomes. Leadership must empower teams with real authority, establish clear performance standards, and hold everyone accountable for meeting—or exceeding—those benchmarks. Without this cultural shift, even the best strategy becomes just another plan gathering dust.
When every product meets the same high standard, trust in the IRS will grow—because taxpayers will feel it in every interaction.
A template for all agencies
The IRS touches more Americans than any other federal agency–making it the perfect proof point that the government can deliver digital products that work seamlessly. The principles–build for users, not compliance, shipping daily, not yearly, and keeping the talent in house is not unique to the IRS.
We believe these goals and strategies apply to nearly every agency and level of government. Imagine Social Security retirement planning tools that lead to easy withholding adjustments, a Medicare/Medicaid that is easy to enroll in, or a FEMA with easy to file disaster relief disbursement.
Transform the IRS this towards this path, and then use these lessons to reset and lift up expectations between Americans and their government. One so easy citizens say: “That was it? That was easy.”
Americans trade stocks instantly, but spend 13 hours on tax forms. They send cash by text, but wait weeks for IRS responses. The nation’s revenue collector ranks dead last in citizen satisfaction. The problem isn’t just paperwork — it’s how the government builds.
While it seems that the current political climate may not incentivize the use of evidence-based data sources for decision making, those of us who are passionate about ensuring results for the American people will continue to firmly stand on the belief that learning agendas are a crucial component to successfully navigate a changing future.
In recent months, we’ve seen much of these decades’ worth of progress erased. Contracts for evaluations of government programs were canceled, FFRDCs have been forced to lay off staff, and federal advisory committees have been disbanded.
At a recent workshop, we explored the nature of trust in specific government functions, the risk and implications of breaking trust in those systems, and how we’d known we were getting close to specific trust breaking points.