That seriously harms our able to recruit the best i. T. And Cyber Security talent out there, or immediately ten of the last 14 miami on this authority are senior i. T. Executives who turn into pumpkins by this Time Next Year when their fouryear terms under the authority run out. In fact terry himself is. To we recognize the role as the taxpayers the dont have access to the Digital Economy where prefer not to conduct transactions with the irs of mind we remain committed and dedicated to providing services all tax pirate taxpayers need. For example, we will continue to offer more web base Services Taxpayers can always call the help line or obtain assistance in improving the online experience for those who want to deal that way will freeing resources to make it easier for those who want to visit in person. To in building towards this experience the taxpayers biggest challenge will be to make sure the online accounts are properly protected. Our concern is cybercriminals are becoming sophisticated and continually find new methods to steal personal information and gain access to the more Sensitive Data that in the past on a regular basis and for the reason we need to insure the authentication protocols become more sophisticated moving beyond asking for information that used to be known only to the individual but now is readily available to criminal organizations. I would note those are outside of the irs. There is a delicate balance to provide the strongest possible Authentication Services without making it almost impossible for legitimate tax payers to access their own data. As you can see theyre interesting challenges but it is an exciting journey. We believe the end result is a more effective approach in the irs can do a better job to meet their obligations. That is our story. I speak for the entire irs work force when i continue a record to continuing. And one last thought. If you havent done your tax is dead april 18 will be here before we know what. I am happy to answer as many questions as it can in the thai remaining. I would like to announce the chances of getting the 100 back is very slim. [laughter] this is a great opportunity to mention in that the National Press club is a taxdeductible organizations. [applause] if you make the contribution under tutored 50 you dont need recognition. I am also sorry for butchering your name and i look forward to my audit. [laughter] with the numerous budget cuts will that compliance rate naturally fall costing revenue making it more expensive to collect taxes . It is our ultimate concerned we do a lot of research on this that while we are a tax Compliant Society people think the system is fair but because they know we have a lot of information. We have the money already in our compliance rate is 98 real how the withholding so we have to ask for a but we have 30 but if we dont have the money or the information compliances in the range of 50 so what does remind you it is important for Taxpayer Services and enforcement are two sides of the claim that we need to ensure the system is fair but we also need to ensure that people understand if you try to be compliant but were trying to work with you but not if youre trying to cut corners or cheat either everybody feels they are not paying their fair share or because they think when the compliance rate starts to drop it is 81 . 01 drop cost 30 billion per year but we will never notice that. It will be a while it doesnt appear that the revenues are tracking the way they used to. And more importantly once the psychology changes in people think it is unfair then you look more like greece and italy. So with isnt an idle concern that is the integrity of the system because as noted in my talk be funded the entire government if revenues drop deficits continue to go up. While the fbi found no criminal intent with the targeting they did find that they did things wrong did you find anything wrong and was anyone disciplined . Working in reverse order order, the chain of command around the issue was all gone and they were gone pretty promptly with the commissioner to left that acting commissioner down to the Senior Executive level. So there has ben accountability. There was a Significant Management failure. Applicants should not have to wait months or years to get a response from the irs if there is that kind of backlog it should be identified early up the chain of command. And with that strong support is as we created that organization that they shared view themselves as a risk manager that if they see a problem than that is my problem or it is my mistake but it is critical to make sure that we know about it so as i said in my confirmation hearing and nobody would ever make a mistake but you heard about the 150 million taxpayers in the most complicated tax code. But that better standard is if somebody makes a mistake we will find it quickly and fix it quickly and be transparent and that is not what happened with that situation we accepted all ig recommendations of the bipartisan report designed to ensure that it doesnt happen again. The key factor going for is for people to feel comfortable that bad news is good news the answer is lets fix it to make sure it doesnt happen again. And what about the flat tax . The file is prefaced it is the domain of the congress but then to talk about tax policy that is not our domain. I have said from the start now with the individual taxpayer and the 20 years their corporate boards that it would be in everybodys interest and a think anybody gains from the tax code while those decisions are how you do what are the domain of others to try to make it clear what all meetings on the hill we will do whatever we can to provide Technical Assistance to analyze one way or another what with the administrative impact me on taxpayers . I am a strong believer in there is a growing coalition of people around the country in favor of tax reform. Some will get it from International Tax policies for corporations others understand you cannot deal with corporations without the pass through entities as run through partnerships or S Corporation that dont pay that Corporate Tax server betty elses in the same boat but i am intrigued to some extent an optimistic that there is a growing consensus something has to be done. With regard to flat taxes those our policy issues that the administration need to deal with the were prepared to be supportive from that standpoint of any direction people want to go. I remember there are many cyberthreats. How many millions of dollars are lost with fraudulent tax returns or refund stolen . What solutions are you looking for . Figuring how much got out the door is what you dont know is what you dont know. The estimates a couple years ago estimated slightly over 5 billion was going out of fraudulent returns we have been making significant progress since it exploded in 2010. So as to make more progress partly it is key live if they remember that talks about it next year now we have 2. 7 million and we wont have the numbers this year reduced even have last year if you take a look and all of the returns filed but we think the number is decreasing significantly but even in the billions that is a significant problem we are equally concerned about the inks created for a taxpayer to discover someone has stolen their personal identification and we cannot work to the process. It is as much to protect taxpayers. 11 with almost 200 filters to see what are the anomalies and why is it with 2 million suspicious returns. 11 of because it can becomes clear to go around the entire system. And then to have a site to a computer and more importantly so in realtime we are sharing suspicious patterns. 11 talk about patterns of filing in suspicious concerns. We do that regularly in a way we have never done before. It is important to continue and then demanded to make it permanent because the work so well and we did that. Is not up partnership jointly with the states and will figure out where the neck steps. 11 and then be able to and dissipates to so jews talk about the private sector partners as we close down our system amfac of the next logical place was to attack the prepares a they cannot get the data from us they can get it from the upper pair with 200 clients. And s and is anyone discovers that and it seems odd that we your getting a strange refund request and then to their surprise they were packed and then to protect all others but denmark those accounts. The reason criminals want to get a transcript application they wanted to get your copy of last years return so we would look more logical and attract better because were getting more sophisticated to pick out those anomalies the reason theyre interested trying to attack because as it stops the returns they realize more and more were stopped. So it had nothing to do with us directly but to more private Sector Companies would of the most recent fishing expeditions was the Payroll Department saying i need got following data. And instead went to organized crime all around the world. With those very sophisticated and then it comes up over there and we need to be more and more aggressive how to be close them down at the next point of interface . The. To have those data breaches. And then to be as transparent as we can. We want to make sure individual taxpayers are aware. I would stress because we use the word breach there hasnt been a breach since he has done a great job of protecting it. We are attacked over 1 million times per day. You have a flash of light there is just a beam of light. It is a serious problem. And were dealing with it seriously and we need more funding. And then masquerading as taxpayers to be more sophisticated to get access to a particular application the reason is to figure out how to get around that we could discover those the we had the attack on our palins and the software allowed us to determine if we had that attack and you could see is we are shutting it down moving from country to country. It is important question and we try to respond publicly and quickly for the transcript we looked at within the last Filing Season to give the numbers out with that analysis of the year before there is another set of taxpayers affected but our position has been to let people as quickly as we can if we wait for the final numbers we really have an obligation to let them know. Treasury secretary says he wants to limit but you have any advice how . If we did we would have given it to him by now obviously. The secretary has made it clear there is a limit to what the irs and treasury cando under strut statutory authority. They made it clear that we need legislation. Ultimately with those driving forces we have to revise the tax code that includes everybody either buying or selling to do Something International the treasury has done everything they can but to go further we have to have legislation. Final question. Senator cruz said he would like to abolish the irs. You probably dont want to talk about the president ial contest but could one abolish the irs in one of the repercussions . That has evolved from the start and what that represents the is a frustration with the complexity of the code most people want to be compliant whether god affair in year of being caught or the price of democracy but the more complicated to make it the last estimate was 6 billion hours of individuals filing taxes. What constructive use could those be put to . It is stunning to think about. Clearly something needs to be done it hasnt been revised significantly in 30 years when you get to that point and there are proposals all over the place especially with the president ial primary, my sense abolish is shorthand to fix the tax code. The flat tax suggestion, it would be nice if they could do their return on one page. This somebody still faster read the numbers to make sure they are right. Somebody has to collect that 3. 3 trillion. So what i said last year if you want to call something other than the irs to make you feel better that is okay with me. [laughter] the you have to have somebody somewhere who collects the information to audit to make sure it is accurate and valid mcdonnell trump set donald trump would release his return but he cannot for the audit to they have to wait until it is completed . We take seriously our obligation to protect taxpayer privacy information whether their name or activities it is protected by statute so i cannot comment on anybody situation but even when dealing with someone that is their own possession. We need to understand that senators are respectful toward each other and that will be more conducive to getting real policy done instead of just after now make acrimony and vitriol. These are real people. La mesa president obama he had bags under his eyes. He was tired. Hes a real person dealing with real things and so i thought that was perhaps the most interesting. Washington post journalist capehart came to talk to us and i really loved the insight he gave us about being kind of the outside source, supporting back to us and the electorate about whats going on in our government. Ruth Bader Ginsburg was the most inspirational person we met this week we just been one of my idols for a long time. I either want to be in the Legal Profession or possibly a cemetery. Understand the need for bipartisanship at times but i also think its important that politicians go to washington or go to their state capitols with their eyes on the goal and they are determined to meet that goal instead of sacrificing it in the light of partisanship or whatever does. Winnie to have constructive discourse like a long weekend here. We need to respect all americans to matter what the background making the country more cycle plays where people are welcome to give their opinions. Here on cspan2 tonight the communicators is next with republican congressman Bob Goodlatte of virginia. Plus go Bob Goodlatte is the chairman of the house judiciary committee. He is our guest this week on the communicators. Chairman goodlatte hearings held on encryption fbi apple issue