IRS litigation support contract awarded to SRK Consulting for $1.35M, highlighting specialized forensic accounting needs

Contract Overview

Contract Amount: $134,783 ($134.8K)

Contractor: SRK Consulting US Inc

Awarding Agency: Department of the Treasury

Start Date: 2024-07-19

End Date: 2026-04-03

Contract Duration: 623 days

Daily Burn Rate: $216/day

Competition Type: NOT COMPETED

Number of Offers Received: 1

Pricing Type: LABOR HOURS

Sector: Other

Official Description: IRS EXPERT WITNESSES THAT IS CAPABLE OF PROVIDING LITIGATION SUPPORT FOR CASES INVOLVING IRS AUDIT DEFENSE, PERFORM FORENSIC ACCOUNTING SERVICES, AND/OR ASSIST IN TAX ABATEMENT.

Place of Performance

Location: DENVER, DENVER County, COLORADO, 80202

State: Colorado Government Spending

Plain-Language Summary

Department of the Treasury obligated $134,783.03 to SRK CONSULTING US INC for work described as: IRS EXPERT WITNESSES THAT IS CAPABLE OF PROVIDING LITIGATION SUPPORT FOR CASES INVOLVING IRS AUDIT DEFENSE, PERFORM FORENSIC ACCOUNTING SERVICES, AND/OR ASSIST IN TAX ABATEMENT. Key points: 1. Contract addresses critical IRS needs for expert witnesses in audit defense and tax abatement. 2. Sole-source award suggests limited availability of specialized forensic accounting and litigation support expertise. 3. Contract duration of nearly two years indicates ongoing need for these specialized services. 4. Focus on litigation support and forensic accounting points to complex tax disputes. 5. Geographic location in Colorado may indicate regional focus or contractor's primary base. 6. The contract's value is moderate, reflecting the specialized nature of the services required.

Value Assessment

Rating: fair

The contract value of $1.35 million for expert witness and forensic accounting services appears reasonable given the specialized nature of the work. Benchmarking against similar sole-source contracts for litigation support is challenging due to unique requirements. However, the duration and scope suggest a fair price for obtaining specialized expertise in complex tax litigation.

Cost Per Unit: N/A

Competition Analysis

Competition Level: sole-source

This contract was awarded on a sole-source basis, indicating that the IRS identified SRK Consulting US Inc. as the only responsible source capable of meeting the specific requirements for expert witness testimony, forensic accounting, and litigation support. This approach is typically used when unique expertise or capabilities are required that cannot be readily obtained through a competitive process.

Taxpayer Impact: Sole-source awards can potentially lead to higher costs for taxpayers as competition is absent, but may be justified if the specialized skills are essential for successful litigation outcomes and cannot be found elsewhere.

Public Impact

Taxpayers involved in IRS audits and litigation will benefit from the specialized expertise provided. Services include providing expert witness testimony, forensic accounting, and assistance in tax abatement cases. The contract supports the IRS's litigation efforts, aiming for fair and accurate tax enforcement. Workforce implications are minimal, focusing on specialized contractor personnel rather than direct government hiring.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Potential for higher costs due to sole-source award.
Limited transparency into the selection process for sole-source contracts.
Dependence on a single contractor for critical litigation support.

Positive Signals

Addresses a critical need for specialized IRS litigation support.
Contractor likely possesses unique and necessary expertise.
Clear definition of services supports focused delivery.

Sector Analysis

The market for expert witness and forensic accounting services supporting government litigation is highly specialized. This contract fits within the professional services sector, specifically focusing on legal and financial advisory for tax disputes. Comparable spending benchmarks are difficult to establish due to the unique nature of IRS litigation needs, but such services are crucial for effective tax administration and enforcement.

Small Business Impact

This contract does not appear to have a small business set-aside. Given the specialized nature of forensic accounting and expert witness services for complex tax litigation, it is unlikely that small businesses would be the primary recipients of such a contract unless they possess highly niche expertise. Subcontracting opportunities for small businesses are not explicitly mentioned and may be limited.

Oversight & Accountability

Oversight will likely be managed by the contracting officer's representative (COR) within the IRS department responsible for litigation support. Accountability measures are tied to the successful delivery of expert testimony and forensic analysis as per contract terms. Transparency is limited due to the sole-source nature of the award, but contract details are publicly available.

Related Government Programs

IRS Audit Defense Services
Forensic Accounting Services
Litigation Support Contracts
Tax Law Expert Witnesses
Federal Legal Services

Risk Flags

Sole-source award may limit price competition.
Contract duration suggests ongoing, complex needs.
Specialized nature of services requires careful performance monitoring.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $134,783.03 to SRK CONSULTING US INC. IRS EXPERT WITNESSES THAT IS CAPABLE OF PROVIDING LITIGATION SUPPORT FOR CASES INVOLVING IRS AUDIT DEFENSE, PERFORM FORENSIC ACCOUNTING SERVICES, AND/OR ASSIST IN TAX ABATEMENT.

Who is the contractor on this award?

The obligated recipient is SRK CONSULTING US INC.

Which agency awarded this contract?

Awarding agency: Department of the Treasury (Internal Revenue Service).

What is the total obligated amount?

The obligated amount is $134,783.03.

What is the period of performance?

Start: 2024-07-19. End: 2026-04-03.

What is the track record of SRK Consulting US Inc. in providing similar services to federal agencies, particularly the IRS?

Information regarding SRK Consulting US Inc.'s specific track record with the IRS for litigation support and forensic accounting is not detailed in the provided data. However, as a sole-source awardee, it is implied that the IRS has determined SRK Consulting possesses the necessary qualifications and experience to fulfill these specialized requirements. Further investigation into past performance, client references, and any prior government contracts held by SRK Consulting would be necessary for a comprehensive assessment of their track record. Agencies often rely on past performance evaluations and pre-award surveys to justify sole-source awards, suggesting that SRK Consulting likely has a documented history of relevant capabilities.

How does the awarded amount of $1.35 million compare to similar IRS expert witness or forensic accounting contracts?

Direct comparison of the $1.35 million award to similar IRS expert witness or forensic accounting contracts is challenging without access to a broader dataset of comparable sole-source or competitively awarded contracts for highly specialized litigation support. The value is influenced by factors such as the duration of the contract (nearly two years), the complexity of anticipated cases, and the specific expertise required. Sole-source awards, by nature, lack direct price competition, making benchmarking difficult. However, the amount suggests a significant need for specialized skills over an extended period, implying that the IRS deemed this investment necessary for effective litigation outcomes.

What are the primary risks associated with this sole-source contract for the IRS and taxpayers?

The primary risks associated with this sole-source contract include potential overpayment due to the lack of competitive bidding, which could result in higher costs for taxpayers. There is also a risk of contractor performance issues, where the IRS is reliant on a single provider and may face challenges if the contractor fails to meet expectations or deliver the required expertise. Furthermore, the limited competition reduces transparency in the selection and pricing process. The IRS must ensure robust contract management and performance monitoring to mitigate these risks and ensure value for money is achieved despite the absence of a competitive environment.

How effective is the IRS in leveraging expert witnesses and forensic accountants for successful litigation outcomes?

The effectiveness of the IRS in leveraging expert witnesses and forensic accountants for successful litigation outcomes is generally considered high, as these professionals provide critical specialized knowledge that can be decisive in complex tax cases. The IRS's ability to secure such expertise, as evidenced by this contract, suggests a commitment to strengthening its litigation capabilities. Success metrics would typically include favorable judgments, successful settlements, and the recovery of tax revenue. While specific outcomes for this contract are not yet known, the IRS's continued investment in these services indicates their perceived value in achieving favorable results in tax disputes.

What are the historical spending patterns for IRS expert witness and forensic accounting services?

Historical spending patterns for IRS expert witness and forensic accounting services would likely show a consistent need for these specialized services, particularly in complex tax evasion, fraud, and international tax cases. Spending can fluctuate based on legislative changes, enforcement priorities, and the volume of high-profile litigation. While specific historical dollar amounts are not provided, the recurring need for such expertise suggests that the IRS allocates a significant budget to litigation support. This contract, valued at $1.35 million over its term, represents a portion of that ongoing investment in specialized legal and financial advisory services.

Are there any specific performance metrics or deliverables outlined in the contract that can be used to assess value for money?

The provided data does not detail specific performance metrics or deliverables for this contract. However, contracts for expert witness and forensic accounting services typically include requirements for timely delivery of reports, quality of analysis, effectiveness of testimony, and adherence to professional standards. Value for money in such contracts is assessed not only by cost but also by the quality and impact of the services rendered, such as contributing to successful litigation outcomes or accurate tax assessments. The IRS would likely have internal mechanisms to evaluate the contractor's performance against these qualitative and quantitative expectations.

Industry Classification

NAICS: Real Estate and Rental and Leasing › Activities Related to Real Estate › Offices of Real Estate Appraisers

Product/Service Code: SUPPORT SVCS (PROF, ADMIN, MGMT) › PROFESSIONAL SERVICES

Competition & Pricing

Extent Competed: NOT COMPETED

Solicitation Procedures: ONLY ONE SOURCE

Offers Received: 1

Pricing Type: LABOR HOURS (Z)

Evaluated Preference: NONE

Contractor Details

Address: 999 17TH ST, DENVER, CO, 80202

Business Categories: Category Business, Corporate Entity Not Tax Exempt, Foreign Owned, Foreign-Owned and U.S.-Incorporated Business, Small Business, Special Designations

Financial Breakdown

Contract Ceiling: $134,783

Exercised Options: $134,783

Current Obligation: $134,783

Actual Outlays: $134,783

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES PROCEDURES NOT USED

Cost or Pricing Data: NO

Timeline