US Tax Service:
Early Approaches: The US Tax Forms Simplification Project

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This case concerns one of the earliest attempts by design thinkers at designing a large, complex system. It shows that design approaches in the public sector can look back at a long history. And it reveals how design thinking within the organization must include members of the whole organization in the design process.

Design has a long tradition and a rich history in the public sector. Nearly 40 years ago, when the US Congress passed the Paperwork Reduction Act into law, the Internal Revenue Service (IRS) turned to designers in an effort to implement the new policy and to improve its relationship with taxpayers. The Paperwork Reduction Act required all government agencies to reduce the burden on people to collect information they needed. This was a serious problem for the IRS. At the time, American taxpayers spent up to 45 hours trying to report their annual income to the agency. There was a strong indication that the forms themselves posed a problem. What follows is a rather simplified version of what went on at the time. The full details and the complexities of the case are better explained in my forthcoming book Transforming Public Services by Design: Re-Orienting Service, Organizations and Policies around People (Gower).

 

High rate in erroneously filled out forms
Pointing to the tax forms as a problem was an easy guess. The forms were the direct interface between the organization and the individual person. The forms were the basis for information collection but also the means of interaction at the time. As with many forms we find today, the tax forms asked questions in ways people had difficulties to understand and therefore problems to answer correctly. Driven by the terminology and the legal codex IRS tax experts thought necessary, laymen taxpayers struggled because these terms and concepts remained meaningless and confusing for them. One of the results was a high rate in erroneously filled out forms caused additional work for IRS employees. Some of the cost was obvious: additional work-hours for IRS employees and, because of erroneous reporting, a failure to collect the right amount of tax money, which resulted in lost revenue. Another cost though included increased impatience and frustration with the tax office, which manifested itself in fewer people reporting their taxes. Both the credibility of the office and its ability to generate revenue for the government were at stake.

 

Design consortium conducts field studies and tests new forms with common tax payers
A design consortium under the leadership of a renowned design consultancy won the tender for the project to simplify tax forms. The interdisciplinary team included a graphic designer, a professional writer on the front of the plain language movement, a cognitive expert on reading ability, and experts in usability testing. This team began by weeding through the existing tax forms system and by conducting interviews with tax lawyers and different groups of tax payers. Almost 40 years ago, designers already included common taxpayers in the design process, frequently tested their redesigns in the field and generated innovative solutions for a government agency.
Among these was a strong recommendation for a short tax form for standard taxpayers, a medium tax form for people with slight deviations from the majority of taxpayers, and finally a long form for the exceptional cases.The design team found that the problem was not in the tax forms alone, which, admittedly suffered from poor design.
The bigger problem the design team identified was the absence of a medium length tax form. Many taxpayers had tax situations that forced them out of the short tax form and into the long tax form. The latter, however, rarely matched their situation which was far less complex than the form assumed. Based on their user research and their analysis of the tax forms system, the design team proposed the introduction of a new, third tax form in addition to applying basic design principles and plain language understandable by non tax experts.

 

Great solution – late implementation
In the end, the design team was able to justify their solutions with both quantitative and qualitative findings from user research. To their surprise, the IRS was satisfied with the visual and verbal upgrade of their forms but did not want to hear anything about redesigning the forms around the different kinds of users the design team had identified. What the design team missed, however, was a solid understanding of the users within the organization. Then as now, the IRS faced cuts in staff and budgets. When the design team proposed a third tax form, the IRS thought about it in terms of added workload it would have to cope with under shrinking organizational resources.
Roughly ten years later, the IRS introduced a new, short tax form, the 1040EZ (EZ stands for “easy”). The original design team, while frustrated at the time, found consolation that their work was not in vain after all.

 

Learnings
Among the things that can be learned from this case is that design thinking within the organization must include members of this organization in the design process. The organization’s participation in the process is a prerequisite for the acceptance of the solution into the organization. Staff are users, too. And their needs have to be met and their knowledge be integrated. One might simply state “Introducing the results of human-centered design efforts into an organization that has not managed the shift from organizational perspective to user perspective is doomed for failure.”


Introducing the results of human-centered design efforts into an organization that has not managed the shift from organizational perspective to user perspective is doomed for failure.

But this statement is a cop-out for designers. It is the task of the design team to invite, engage and enable the organization as much as it is the task of the design team to invite and engage every other user. In doing so, design is contributing to organizational changes on all levels, including its cultural understanding. Ignoring key organizational aspects can be detrimental to the sustainability of any particular design. In the public sector, we cannot afford such ignorance. Instead, we need to understand current design practices and current design thinking in order to build bridges for people to engage in new ways of doing and thinking.
A first version of this article was published at the Conference Proceedings of the 6th Annual Conference of the European Academy of Design, Bremen.


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Sabine Junginger

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