The IRS Statistics of Income Division (SOI) has suspended its Joint Statistical Research Program (JSRP) due to resource constraints. As a result, there will be fewer independent analyses of how the US tax system is performing and how it could improve, just as significant changes from the One Big Beautiful Bill Act and an historic drop in IRS staffing go into effect.
If the Treasury Department does not restore staffing and resources to reinstate this important program, it risks losing critical insights that support effective tax policy development and enforcement.
What Are the SOI and JSRP?
SOI’s primary mission is to disseminate credible, timely, and relevant statistics on the tax system. Researchers, media, and governments at all levels use these data for tax and economic analysis. When disclosure laws and privacy concerns prevent the public release of statistical information, the National Academies’ Committee on National Statistics directs statistical agencies like SOI to make the data available for research and other statistical purposes through restricted access modes.
The JSRP, established in 2012, meets this requirement by enabling secure and limited use of anonymized tax microdata by qualified non-IRS researchers. Federal law requires statistical agencies to adopt a standard application process, including a common application website, when granting access to confidential data for statistical purposes. Current OMB guidelines require SOI to issue annual calls for new research proposals using these data.
Outside researchers must work with SOI and other IRS staff to provide new insights and advance the understanding of the ways that existing tax laws and administrative procedures affect individuals, businesses, and the economy. They also help develop new statistical products for public release. Since its inception, the program has supported almost 100 research projects in partnership with researchers representing about 70 institutions, including universities, other government agencies and think tanks, including the Tax Policy Center.
JSRP improves tax administration
As noted in a recent blog from the Tax Law Center, the JSRP has provided important insights that have improved tax administration and informed tax and economic policies. SOI’s Working Papers are all available on a public website, and they provide critical insights on topics like taxpayer responses to tax law changes, the evolution of the gig economy and crypto currency, ways taxpayers prepare for retirement, the effectiveness of various tax compliance strategies, and the impacts of refundable tax credits on lower-income taxpayers.
In addition, the JSRP increases SOI’s capacity to meet the ever-increasing demand for new products beyond what would be possible with existing staff. For example, JSRP projects have resulted in popular data products, such as new detailed earnings tabulations. Another JSRP product, synthetic income data (artificially generated information that mirrors the structure and patterns of real-world data) for those whose income is below the tax filing requirement has fostered a better understanding of household income dynamics for lower income individuals.
JSRP improves the quality of IRS work
The JSRP also provides important learning opportunities to SOI employees. Each project requires involvement of SOI staff, who help curate data needed for the project, track progress toward agreed goals, and often contribute to the analysis and final products.
In doing so, employees engage with leading researchers, learn new cutting-edge analytical methods, and contribute to research with broad public value. These experiences improve the overall quality of work produced by SOI and boost recruitment and retention of high-quality SOI professional staff.
SOI needs resources
Staff reductions, including layoffs of probationary employees, voluntary separation programs, and a hiring freeze, have shrunk SOI staffing to an historic low, impacting the JSRP in two ways. First, there aren’t enough employees left to oversee JSRP projects that have already been approved, much less review new applications. Second, external researchers, who are usually on loan to the IRS through an OMB program, have been prevented from working on JSRP projects due to a hiring freeze.
OMB rules require Treasury to work with OMB to ensure SOI has sufficient resources to fulfill its mission, including supporting the JSRP. But right now, SOI lacks adequate resources to backfill key positions, onboard approved JSRP participants, or resume annual calls for new research projects.
Without immediate action, the federal government will lose a key tool for improving tax administration by understanding how tax policies impact revenue and taxpayer behavior.
