Lending

MBA bankrolling IRS $10,000 challenge to 'reimagine' taxpayer experience

IRS launches crowdsourced competition; changes could ease income verification

Money Jar

The Internal Revenue Service is launching its first crowdsourced challenge, offering big money to anyone who can come up with the best idea to “reimagine the taxpayer experience of the future.”

But the money is not coming from the IRS itself. Rather, the funding for the IRS’ crowdsourcing challenge is coming from an interesting source – the Mortgage Bankers Association.

The IRS’ tax design challenge, which begins accepting submissions on April 17, offers participants a grand prize of $10,000 if their idea is chosen as the winner of the best overall design.

Other prizes include $5,000 for second place in the best overall design category, while first place in best taxpayer usefulness and first place in best in financial capability get $2,000 each. Second place in those two categories get $1,000 each.

And all of the money is coming from the MBA.

So what’s the purpose of this competition from the MBA and IRS perspective?

For the IRS, it’s about “developing new concepts for designing, organizing and presenting tax information in a way that makes it easier for taxpayers to understand their taxpayer responsibilities and effectively use their own taxpayer data.”

And they want the public’s help with that.

“Taxpayers have the right to be informed, which includes access to their personal taxpayer data,” the IRS states in the details of the Tax Design Challenge, which can be found here.

“Many taxpayers, however, might not know where to find this information or how to use it, as much of this information reads like a receipt and can be hard to understand for those who are not finance professionals,” the IRS continues.

“The goal of this challenge is to reimagine the taxpayer experience and design the taxpayer experience of the future,” the IRS. “With over 200 data fields at play, how might we design, organize, and present tax information in a way that makes it easier for taxpayers to manage their taxpayer responsibilities, and to use their own taxpayer data to make informed and effective decisions about their personal finances?”

For the MBA, it hopes that its involvement in the crowdsourcing challenge results in an improved experience for the taxpayer, which, in turn, would help to improve the consumer experience for lending, according to Rick Hill, the MBA’s vice president of industry technology.

Hill told HousingWire that the MBA’s involvement in the project was borne out of “ongoing conversations” between the IRS and the MBA on improvements to the process for obtaining tax transcripts, which Hill said are a “critical component” to the lending process.

Hill told HousingWire that the IRS reached out to the MBA to launch this project, which seemed like a logical undertaking for the MBA to be a part of.

“The competition will touch on aspects of the taxpayer experience that relate to the origination of a loan,” Hill said. “Specifically, the industry uses tax data obtained directly from the IRS to ensure that the potential borrower has the income necessary to qualify for their loan.”

Hill said that for both the IRS and the MBA, the idea of crowdsourced challenge of this kind presents an opportunity to tap into some new ideas.

“An event that is open to the public may generate ideas and concepts that otherwise would not have been considered,” Hill said. “If just a few of the ideas help the IRS improve the taxpayer experience, these ideas should translate into an improved experience for those who are seeking a new loan.”

According to the IRS’ posting in the Federal Register, the competition presents “an incredible opportunity for civic-minded technologists, designers, and innovative thinkers to improve and shape the user experience of one of the most visited government websites in the U.S.”

The IRS’ posting states that it is looking for entries that:

  • Improve the visual layout and style of the information for the taxpayer
  • Make it easier for a taxpayer to manage his/her taxpayer responsibilities
  • Empower a taxpayer to make informed and effective decisions about his/her personal finances

Hill said that he believes that the IRS and MBA have a shared objective and hope that this competition proves fruitful.

“I cannot speak for the IRS, but I believe both organizations have an interest in improving the consumer experience for the individuals we service,” Hill said. “The IRS calls them taxpayers. We call them borrowers. They are the same people.”

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