The IRS relies extensively on information technology (IT) to carry out its mission. For fiscal year 2012, IRS requested about $2.67 billion for IT. Given the size and significance of these investments, this report evaluates IRS's capabilities for managing its IT investments. To address this objective, the report reviewed IRS policies and procedures and assessed them using IT investment management framework and associated methodology, focusing on the framework's stage relevant to building a foundation for investment management. The report also interviewed officials responsible for IRS's investment management process. Includes recommendations. Charts and tables. This is a print on demand publication.