IRS Digitization Contract Awarded to Cherokee Nation Solutions for $17.36M to Modernize Tax Form Submission

Contract Overview

Contract Amount: $17,362,348 ($17.4M)

Contractor: Cherokee Nation Solutions Link, L.L.C.

Awarding Agency: Department of the Treasury

Start Date: 2024-09-30

End Date: 2025-09-29

Contract Duration: 364 days

Daily Burn Rate: $47.7K/day

Competition Type: NOT AVAILABLE FOR COMPETITION

Number of Offers Received: 1

Pricing Type: FIRM FIXED PRICE

Sector: IT

Official Description: THE AGENCY IS SEEKING TO TRANSFORM THE TAX ADMINISTRATION IN THE UNITED STATES BY PROVIDING TAXPAYERS OPPORTUNITIES TO SUBMIT FORMS AND DOCUMENTS TO THE INTERNAL REVENUE SERVICE ELECTRONICALLY BY DIGITIZING THE FORMER PAPER CENTRIC SYSTEM.

Place of Performance

Location: PHILADELPHIA, PHILADELPHIA County, PENNSYLVANIA, 19104

State: Pennsylvania Government Spending

Plain-Language Summary

Department of the Treasury obligated $17.4 million to CHEROKEE NATION SOLUTIONS LINK, L.L.C. for work described as: THE AGENCY IS SEEKING TO TRANSFORM THE TAX ADMINISTRATION IN THE UNITED STATES BY PROVIDING TAXPAYERS OPPORTUNITIES TO SUBMIT FORMS AND DOCUMENTS TO THE INTERNAL REVENUE SERVICE ELECTRONICALLY BY DIGITIZING THE FORMER PAPER CENTRIC SYSTEM. Key points: 1. The contract aims to digitize the IRS's paper-centric system, offering electronic submission for tax forms and documents. 2. Cherokee Nation Solutions Link, L.L.C. is the awardee for this significant IT modernization effort. 3. The contract is for 'Other Management Consulting Services' with a firm fixed price. 4. This initiative addresses a critical need for improved taxpayer experience and operational efficiency at the IRS.

Value Assessment

Rating: questionable

The contract value of $17.36M for a one-year duration is substantial. Without comparable contract data for similar IT modernization and digitization projects within government agencies, a precise pricing assessment is difficult. The 'Other Management Consulting Services' NAICS code is broad.

Cost Per Unit: N/A

Competition Analysis

Competition Level: limited

The contract was not available for competition, indicating a limited source selection. This approach may limit price discovery and potentially lead to higher costs compared to a fully competitive process. The rationale for limiting competition is not provided.

Taxpayer Impact: Taxpayers may benefit from improved services and efficiency in the long run, but the immediate impact of a limited competition on cost efficiency is unclear.

Public Impact

Modernization of tax form submission aims to streamline processes for millions of taxpayers. Digitization could lead to faster processing times and reduced errors in tax filings. Improved electronic services are expected to enhance taxpayer engagement and compliance. The project represents a significant step towards a more digital-first government agency.

Waste & Efficiency Indicators

Waste Risk Score: 50 / 10

Warning Flags

Limited competition raises concerns about cost-effectiveness.
Lack of transparency in the award process.
Potential for cost overruns in complex IT transformations.

Positive Signals

Addresses a critical need for IRS modernization.
Potential for significant improvements in taxpayer services.
Award to a company with potential for specialized expertise.

Sector Analysis

This contract falls under IT and Management Consulting services. Spending in this sector is high as agencies continue to modernize systems. Benchmarks for similar large-scale digitization projects are essential for evaluating value.

Small Business Impact

The data indicates this contract was not awarded to a small business (sb: false). There is no information on subcontracting opportunities for small businesses within this award.

Oversight & Accountability

The limited competition and lack of detailed justification for the award method warrant close oversight. Accountability for project delivery, cost control, and achievement of modernization goals will be crucial.

Related Government Programs

Other Management Consulting Services
Department of the Treasury Contracting
Internal Revenue Service Programs

Risk Flags

Lack of competitive bidding.
Unclear justification for limited competition.
Potential for cost overruns in IT modernization.
Absence of defined performance metrics.
Limited transparency in the procurement process.

Frequently Asked Questions

What is this federal contract paying for?

Department of the Treasury awarded $17.4 million to CHEROKEE NATION SOLUTIONS LINK, L.L.C.. THE AGENCY IS SEEKING TO TRANSFORM THE TAX ADMINISTRATION IN THE UNITED STATES BY PROVIDING TAXPAYERS OPPORTUNITIES TO SUBMIT FORMS AND DOCUMENTS TO THE INTERNAL REVENUE SERVICE ELECTRONICALLY BY DIGITIZING THE FORMER PAPER CENTRIC SYSTEM.

Who is the contractor on this award?

The obligated recipient is CHEROKEE NATION SOLUTIONS LINK, L.L.C..

Which agency awarded this contract?

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

What is the total obligated amount?

The obligated amount is $17.4 million.

What is the period of performance?

Start: 2024-09-30. End: 2025-09-29.

What is the specific justification for awarding this contract on a limited competition basis, and what steps were taken to ensure fair pricing?

The justification for limited competition is not provided in the data. Typically, such justifications might include urgency, unique capabilities, or specific government requirements. Without this information, it's difficult to assess if fair pricing was achieved through adequate market research or negotiation strategies. Further inquiry into the agency's procurement file would be necessary.

How will the success of this digitization initiative be measured, and what are the key performance indicators (KPIs) for taxpayer impact and cost savings?

Success metrics for this digitization initiative should focus on quantifiable improvements such as reduced processing times for forms, decreased error rates in submissions, increased adoption of electronic filing methods by taxpayers, and measurable cost savings in operational overhead. Key Performance Indicators (KPIs) should be clearly defined in the contract.

What is the projected return on investment (ROI) for this $17.36M contract, considering both the cost of implementation and the anticipated benefits of a modernized tax system?

The projected ROI is not explicitly stated. It would depend on the quantifiable benefits realized, such as reduced manual processing costs, improved accuracy leading to fewer audits or corrections, and enhanced taxpayer compliance through easier filing. A thorough cost-benefit analysis should have been conducted prior to award.

Industry Classification

NAICS: Professional, Scientific, and Technical Services › Management, Scientific, and Technical Consulting Services › Other Management Consulting Services

Product/Service Code: IT AND TELECOM - INFORMATION TECHNOLOGY AND TELECOMMUNICATIONS › IT AND TELECOM - APLLICATIONS

Competition & Pricing

Extent Competed: NOT AVAILABLE FOR COMPETITION

Solicitation Procedures: ONLY ONE SOURCE

Solicitation ID: 2032H524R00027

Offers Received: 1

Pricing Type: FIRM FIXED PRICE (J)

Evaluated Preference: NONE

Contractor Details

Address: 2 W 2ND ST STE 1500-39, TULSA, OK, 74103

Business Categories: 8(a) Program Participant, Category Business, Corporate Entity Not Tax Exempt, HUBZone Firm, Limited Liability Corporation, Minority Owned Business, Native American Owned Business, Self-Certified Small Disadvantaged Business, Small Business, Special Designations, Tribally Owned Firm, U.S.-Owned Business

Financial Breakdown

Contract Ceiling: $17,362,348

Exercised Options: $17,362,348

Current Obligation: $17,362,348

Actual Outlays: $17,362,348

Subaward Activity

Number of Subawards: 1

Total Subaward Amount: $9,550,000

Contract Characteristics

Commercial Item: COMMERCIAL PRODUCTS/SERVICES

Cost or Pricing Data: NO

Timeline