- Treasury Department requests $2.4 billion for IRS cloud technology in FY25
- Federal civilian agencies seek nearly $9 billion for cloud-related programs in FY25
- IRS accounts for $2 billion of Treasury’s total budget for cloud work in FY25
- Treasury outpaces other agencies in cloud technology funding requests
- Pentagon awarded a $9 billion enterprise cloud contract in 2022
Treasury’s Push for IRS Cloud Funding
The Treasury Department is making significant strides in embracing cloud technology, with a substantial funding request of approximately $2.4 billion for fiscal year 2025. This move is part of the department’s efforts to modernize its systems, particularly focusing on the Internal Revenue Service (IRS). According to an analysis by Deltek, the bulk of the funding is allocated towards programs at the IRS that utilize cloud technology. This highlights the Treasury’s commitment to leveraging cloud capabilities to enhance efficiency and effectiveness within the agency.
IRS at the Forefront of Cloud Adoption
Alex Rossino, an advisory research analyst at Deltek, emphasized that a significant portion of the Treasury’s budget for FY25 is dedicated to cloud-related programs at the IRS, amounting to $2 billion. Rossino noted that the IRS is leading the way in embracing cloud technology within the department, with a focus on modernization efforts. He highlighted the importance of adopting cloud-native capabilities and migrating existing systems to the cloud to optimize operations.
The emphasis on cloud technology within the IRS showcases the department’s commitment to staying at the forefront of technological advancements. By leveraging the cloud, the IRS aims to streamline processes, enhance data security, and improve overall service delivery to taxpayers. This strategic investment in cloud technology reflects the Treasury’s recognition of the transformative potential of cloud solutions in enhancing operational efficiency and effectiveness.
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Treasury’s Competitive Edge in Cloud Technology
The Treasury Department’s substantial budget request for cloud technology sets it apart from other civilian agencies, with a significant lead over the next highest agency, the Department of Health and Human Services, by over $1 billion. This ambitious funding request underscores the Treasury’s commitment to accelerating its adoption of cloud technology and driving innovation within the department. The focus on cloud technology not only enhances operational capabilities but also positions the Treasury as a leader in leveraging cutting-edge solutions to meet evolving demands.
Rossino highlighted that while the Treasury’s efforts to embrace cloud technology have been commendable, there was a lag in adoption compared to other civilian agencies. However, the department’s proactive approach in recent years demonstrates its commitment to closing this gap and harnessing the full potential of cloud technology. By investing significantly in cloud-related programs, the Treasury is paving the way for enhanced efficiency, agility, and cost-effectiveness within the department.
Opportunities for Cloud Providers
The report by Deltek also shed light on the broader landscape of cloud adoption across civilian agencies, with the Departments of Agriculture, Homeland Security, and the Social Security Administration already leveraging cloud technology extensively. While these agencies are also increasing their cloud-related program budgets, their growth rates align with the maturity of their cloud adoption. This indicates a more measured approach to integrating cloud solutions, emphasizing sustainability and optimization of cloud capabilities.
Rossino noted that civilian agencies present lucrative opportunities for cloud providers due to the easier acquisition process compared to the Department of Defense (DOD). He highlighted that small businesses looking to engage with government agencies in the cloud space may find greater success by targeting civilian agencies first. The DOD, despite its substantial cloud budget, poses challenges in terms of procurement processes, making it more complex for cloud providers to navigate.
The Treasury Department’s robust funding request for IRS cloud technology signals a significant commitment to driving innovation and modernization within the agency. By prioritizing cloud adoption and investing in cutting-edge solutions, the Treasury is poised to enhance operational efficiency, data security, and service delivery. This strategic focus on cloud technology not only strengthens the Treasury’s competitive edge but also sets a benchmark for other civilian agencies in leveraging cloud solutions for operational excellence.
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