IRS faces last-minute work to solve Y2K problem

Death and taxes remain certain even as the odometer of the years rolls over into 2000. Taxes will be collected, refunds remitted and benefits paid after Jan. 1, 2000. But first, intense last-minute work to fix the Y2K bug is required, federal officials told House lawmakers Wednesday.

Eleventh-hour testing and delayed development of Y2K contingency plans could put the IRS at risk for a millennial meltdown.

"We prioritized our schedules so that systems involved in the filing season will be converted and tested at a later date. Any problems that we encountered have not impacted taxpayers and were generally fixed within 24 hours of being identified," IRS Commissioner Charles Rossotti told the House Ways and Means Committee Wednesday.

The IRS has repaired 88 percent of its mission-critical computer systems and plans to replace 35,000 PCs by July. The agency will also begin its first phase of end-to-end testing, which will determine whether IRS computers in Washington will be able to interface with their counterparts in the states, in April. Contingency plans will be drawn up by the end of May, and the second testing phase will end in December.

The General Accounting Office says it still cannot provide a clear picture of IRS readiness because of how the agency has structured its remediation efforts.

"With so little time remaining and so much at stake for 260 million Americans, we must work together to rise to the Y2K challenge and make sure that vital services aren't disrupted," said Ways and Means Chairman Bill Archer, R-Texas.

While the Social Security Agency was declared Y2K compliant last month, the Health Care Financing Administration is still facing problems with making sure states, contractors and health care providers are up to speed.

SSA Commissioner Kenneth Apfel said that although SSA computer systems are Y2K ready, contingency plans are in place to ensure benefit payments are delivered. He estimated there could be a one-week delay for beneficiaries if their banks have trouble with electronic transfers, but in emergency situations checks can be cut in field offices.

Rep. Jerry Kleczka D-WI said he'd like to see no delay for any senior citizens, regardless of financial need. "The emergency is 'It's my money and I want it.' "