US taxpayer database update suffers delay

The US Internal Revenue Service has delayed a project to modernise its taxpayer database, citing problems with the transition ...

The US Internal Revenue Service has delayed a project to modernise its taxpayer database, citing problems with the transition  from the old system to the new system.

The agency has launched an independent review of the project through the Software Engineering Institute of Carnegie Mellon University in Pittsburgh. The review will look at the performance of a team of contractors led by Computer Sciences (CSC), and the agency's management of the contract since it was signed more than four years ago.

The IRS has asked the institute to recommend changes to the project in 60 to 90 days.

The contractors being led by CSC include IBM, BearingPoint, Northrop Grumman Information Technology, Unisys and Science Applications International.

The IRS said the taxpayer database in question is based on DB2 technology from IBM. IBM declined to comment.

The new system, called the Customer Account Data Engine (CADE) is, eventually, intended to house tax information from more than 200 million US taxpayers. It will replace Master File, a magnetic tape-based system that the IRS began using about 40 years ago.

Master File, takes a week for records updates, causing delays in providing accurate account data on taxpayers.

After the first delay, the IRS renegotiated the terms with the contractors working on the CADE project. The IRS spokesman said he was unaware of any efforts to further renegotiate the contract.

  Grant Gross writes for IDG News Service

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