What GAO Found To operate as effectively and efficiently as possible, Congress, the administration, and federal managers must have ready access to reliable and complete financial and performance information—both for individual federal entities and for the federal government as a whole. GAO’s report on the U.S. government’s consolidated financial statements for fiscal years 2025 and 2024 discusses progress that has been made but also underscores that much work remains to improve federal financial management and that the federal government continues to face an unsustainable long-term fiscal path. The federal government’s net costs were about $7.3 trillion in fiscal year 2025. Fiscal Year 2025 Net Costs of U.S. Government Operations ($7.3 Trillion) GAO found the following: Certain material weaknesses in internal control over financial reporting and other limitations resulted in conditions that prevented GAO from expressing an opinion on the accrual-based consolidated financial statements as of and for the fiscal years ended September 30, 2025, and 2024. Significant uncertainties, primarily related to the achievement of projected reductions in Medicare cost growth, and a material weakness in internal control prevented GAO from expressing an opinion on the sustainability financial statements (e.g., Statements of Long-Term Fiscal Projections and social insurance statements). Material weaknesses resulted in ineffective internal control over financial reporting for fiscal year 2025. Material weaknesses and other scope limitations, discussed above, limited tests of compliance with selected provisions of applicable laws, regulations, contracts, and grant agreements for fiscal year 2025. Three major impediments have continued to prevent GAO from rendering an opinion on the federal government’s accrual-based consolidated financial statements: (1) serious financial management problems at the Department of Defense, (2) the federal government’s inability to adequately account for intragovernmental activity and balances between federal entities, and (3) weaknesses in the federal government’s process for preparing the consolidated financial statements. In addition, several other significant federal entities, such as the Small Business Administration, were not able to obtain opinions on their fiscal years 2025 and 2024 financial statements. Efforts are under way to resolve these issues. The material weaknesses underlying the three major impediments and the other financial management challenges (1) affect the federal government’s ability to reliably measure the full cost, as well as the financial and nonfinancial performance, of certain programs and activities; (2) impair the federal government’s ability to adequately safeguard significant assets and properly record various transactions; (3) hamper the federal government’s ability to reliably report a significant portion of its assets, liabilities, costs, and other related information; and (4) hinder the federal government from having reliable, useful, and timely financial information to operate effectively and efficiently. Two other continuing material weaknesses are the federal government’s inability to (1) determine the full extent to which improper payments, including fraud, occur and reasonably assure that appropriate actions are taken to reduce them and (2) identify and resolve information system control deficiencies and manage information security risks on an ongoing basis. The fiscal year 2025 government-wide total of reported improper payment estimates was $186 billion, but it did not include estimates for certain government programs. Thirteen of the 24 agencies covered by the Chief Financial Officers Act of 1990 reported material weaknesses or significant deficiencies in information system controls. The Statement of Long-Term Fiscal Projections and related information show that based on current revenue and spending policies, the federal government continues to face an unsustainable long-term fiscal path. Since 2017, GAO has suggested that Congress develop a strategy to place the federal government on a sustainable fiscal path. In commenting on a draft of this report, Department of the Treasury officials expressed their continuing commitment to addressing the problems this report outlines. Why GAO Did This Study The Secretary of the Treasury, in coordination with the Director of the Office of Management and Budget, is required to annually submit audited financial statements for the U.S. government to the President and Congress. GAO is required to audit these statements. The Government Management Reform Act of 1994 has required such reporting, covering the executive branch of government, beginning with financial statements prepared for fiscal year 1997. The consolidated financial statements include the legislative and judicial branches. For more information, contact Dawn B. Simpson at simpsondb@gao.gov. or Robert F. Dacey daceyr@gao.gov.

What GAO Found The Water Resources Development Act of 2018, as amended in 2022 (the 2022 act), authorized the U.S. Army Corps of Engineers to use other transaction (OT) agreements to carry out certain projects to support research activities for its Civil Works program. OT agreements are generally not subject to the same federal laws and regulations as procurement contracts, cooperative agreements, and grants. OT agreements allow agencies more flexibility and help advance the development and use of new technologies more rapidly, which can help agencies to meet mission needs and project requirements. The Corps's first civil works OT agreement was for the design of a prototype model of a waterway channel. Once assembled, this model will allow for research on hydraulic structures, such as testing the operation of lock gates and how they could fail. The Corps reported to GAO that, as of October 2025, the design was roughly 20 percent complete. Should the Corps determine that the design is satisfactory upon its completion, planned for April 2026, Corps officials expect to proceed with assembly of the model as a separate follow-on project. These officials said that for assembly of the model, they could choose to award a new follow-on OT agreement consistent with Corps's authority or a traditional contract subject to the Federal Acquisition Regulation and other federal laws and regulations. Additionally, in September 2025, the Corps awarded three more OT agreements to examine effects of harmful freshwater algal blooms on Corps infrastructure. The research to be conducted under these OT agreements will investigate innovative, cost-effective, and scalable technologies for early detection and management of algal blooms. Why GAO Did This Study The 2022 act authorized the Corps to use OT agreements for research and development to support its civilian civil works missions and authorities. This research can aid the Corps's management of its water resources infrastructure, such as dams and levees, by, for example, helping to mitigate the risks posed by natural disasters and severe weather. The 2022 act includes a provision for GAO to annually report on the Corps's use of its OT authority for research supporting its Civil Works mission. In December 2024, GAO issued its second report on the Corps's use of this authority. This third report updates the status of the Corps's efforts since the 2024 report. GAO reviewed documents and conducted interviews with Corps and Department of the Army officials. Contact: Hilary Benedict at BenedictH@gao.gov.

What GAO Found The National Quantum Initiative Act requires a strategic plan to help direct federal efforts in quantum information science, including quantum computing. An entity known as the Subcommittee on Quantum Information Science (SCQIS), co-chaired by four federal organizations, is responsible for drafting this strategic plan. Among these organizations, the Office of Science and Technology Policy (OSTP) plays a central role. GAO found that, with respect to quantum computing, the current national quantum strategy does not fully address GAO’s desirable characteristics intended to help ensure accountability and more effective results. For example, the relevant planning and reporting documents do not include performance measures to gauge progress on quantum computing. They also do not specify the level of resources, including infrastructure, needed for the National Quantum Initiative. In addition, they do not describe federal agencies’ specific roles and responsibilities, and they do not integrate agency-level plans to implement the strategy. Updating the strategy to address these characteristics could improve interagency planning and coordination. Further, the outcomes of such updates could include more efficient use of federal resources, faster progress in delivering the technology, and better management of quantum computing efforts. Extent to Which the Quantum Computing Component of the National Quantum Strategy Addresses GAO’s Desirable Characteristics of a National Strategy Characteristic GAO assessment Purpose, scope, and methodology Fully addresses Problem definition and risk assessment Fully addresses Goals, subordinate objectives, and performance measures Partially addresses: Includes goals but not subordinate objectives or performance measures. Resources, investments, and risk management Partially addresses: Includes current but not future budgets. No assessment of federal infrastructure needs. Roles, responsibilities, and coordination Partially addresses: Lists agencies but not their specific roles. Integration and implementation Partially addresses: Links to other strategies but does not integrate across agencies. Source: GAO. | GAO-26-107759 The National Quantum Initiative Act also requires SCQIS to develop and assess the U.S. quantum workforce. During its initial assessment, SCQIS noted challenges such as a lack of (1) comprehensive data on the many occupational fields covered by the quantum workforce and (2) metrics for assessing the effectiveness of training programs. An ongoing National Science Foundation-funded study analyzing needed knowledge, skills, and abilities could begin to address such challenges. Why GAO Did This Study Quantum computing leverages physics at the atomic scale to potentially solve certain problems that today’s computers cannot. A future quantum computer may enable advances in drug development, materials, and scientific discoveries. But it also could pose risks. For example, adversaries might use it for cyberattacks or to decode encrypted financial transactions and military communications. In 2018, the President signed the National Quantum Initiative Act into law to help ensure the continued leadership of the U.S. in quantum information science and its technology applications. Multiple federal agencies are working to advance quantum computing, collectively spending about $200 million per year. GAO was asked to review federal efforts regarding quantum computing and cryptography. This report addresses (1) the extent to which the quantum computing component of the national quantum strategy addresses GAO’s desirable characteristics of a national strategy and (2) the status of federal efforts to develop and assess the U.S. quantum information science workforce. GAO analyzed key strategy documents, interviewed agency officials with leadership roles in advancing quantum computing, and interviewed nonfederal stakeholders.

What GAO Found No area of the federal government is immune to fraud, waste, or abuse. GAO estimates that the federal government loses between $233 billion and $521 billion annually to fraud, based on 2018-2022 data. Delivering foreign assistance can involve specific challenges that increase fraud, waste and abuse risks, such as the presence of conflict in a country and the urgency of providing life-saving aid. GAO’s work in this area has highlighted several instances of actual and potential fraud, waste, and abuse in foreign assistance in countries such as Somalia, Afghanistan, and Mexico. For example, GAO reported on a 2023 United Nations assessment in Somalia that found widespread and systemic diversion of aid, primarily cash assistance. As part of this diversion, beneficiaries reported being required or coerced into paying a significant portion of their aid to those managing the camps where the assistance was distributed, or others. Fraud, Waste, and Abuse Definitions and Examples GAO’s work has identified useful practices and controls in place to manage fraud risks at some agencies. For example, U.S. Agency for International Development’s (USAID) Bureau for Humanitarian Affairs tracked all reported allegations, including fraud, across its awards and identified trends to support its oversight efforts. The Department of State and USAID also maintained processes for reviewing past performance of potential prime partners. However, GAO also identified systematic weaknesses in agencies’ efforts to manage fraud and other risks. For example, State and USAID did not require fraud awareness training, limiting assurance that their staff could identify fraud risks. State and USAID also had weaknesses in their screening and vetting of international organizations and oversight of subawardees, which increased vulnerabilities to risks, such as fraud. Further, the U.S. African Development Foundation (USADF) lacked internal policies and processes to manage fraud and other risks. Treasury officials that supported USADF contracting told GAO that USADF procurement officials also engaged in questionable practices when making foreign assistance awards, such as steering contracts to former USADF contractual employees. USADF’s Director of Financial Management was later criminally charged by the Department of Justice. Why GAO Did This Study Foreign assistance is used to support U.S. foreign policy by providing resources to countries that policymakers have deemed to be strategically important, countries in conflict, and populations in need. The complex environments in which U.S. foreign assistance is often delivered have inherent risks for fraud, waste, and abuse. These risks must be recognized and better managed to fulfill programs and protect taxpayer dollars. Fraud prevention is key as attempting to prosecute individuals and entities after they have committed fraud addresses a small fraction of fraudulent activity, requires significant time and resources, and returns only a portion, if anything, of what was lost. Tactics of those who commit fraud are constantly evolving. As such, agencies should strive to continuously improve anti-fraud efforts to more efficiently and effectively prevent, detect, and respond to fraud. This statement focuses on (1) specific risks and examples of fraud, waste, and abuse associated with foreign assistance and (2) useful practices and weaknesses in fraud risk management in foreign assistance identified through past GAO work. This statement is based on a body of work of selected reports GAO published from July 2015 to January 2026 addressing fraud risk management in foreign assistance.

What GAO Found The U.S. Postal Service (USPS) continues to be in poor financial condition. It has lost money every fiscal year but one since 2007 (see figure). While accumulating $118 billion in net losses over that time, USPS has maintained enough cash reserves to continue operations. It has done so in part by borrowing from the U.S. Treasury the maximum $15 billion it is allowed by statute and by either not making or only partially making required annual funding payments towards its liabilities for retiree health and pension benefits. With billions in new expenses expected by 2031, USPS’s financial condition is at a critical point. The Postmaster General has stated that USPS could run out of cash in early 2027. U.S. Postal Service (USPS) Total Expenses and Total Revenue, Fiscal Years 2007-2025 In 2021, USPS introduced a 10-year strategic plan designed to improve its financial condition while fulfilling its statutory mandates. Since then, USPS has taken several actions to increase revenue and reduce expenses, such as raising prices, realigning its transportation network, and redesigning its processing operations. In addition, Congress provided some financial relief through the Postal Service Reform Act of 2022. However, these actions have not been enough to fix USPS’s unsustainable business model. As GAO has reported, USPS will need to continue to take actions within its own authority to increase its revenues and reduce expenses. Additionally, Congress should take timely action to determine the services it wants USPS to provide and the extent to which USPS should be self-sustaining, consistent with GAO’s prior recommendations. USPS’s service performance has continued to decline in recent years despite lower service standards. Specifically, in fiscal year 2022, USPS revised certain First-Class Mail service standards from a 1-to-3-day delivery window to a 1-to-5-day window. However, since then, USPS data shows that on-time performance has generally declined. For example, First-Class Mail on-time performance declined from 91 percent to about 86 percent from fiscal year 2022 to 2025. Both the USPS Office of the Inspector General and the Postal Regulatory Commission have raised concerns about USPS’s service standards and performance, including possible service impacts on customers in rural areas. Why GAO Did This Study USPS’s financial viability has been on GAO’s High-Risk List since 2009 as rising costs and lower mail volumes have made its business model unsustainable. There is a fundamental tension between the level of service Congress expects USPS to provide and the revenue USPS can reasonably be expected to generate. It is critical for USPS and Congress to address USPS’s unsustainable business model before it is responsible for billions in new annual expenses for retiree health care within the next 5 years. This statement discusses: 1) USPS’s current financial condition, 2) actions USPS and Congress have taken to address its financial condition, and 3) USPS’s service performance. GAO’s description of USPS’s current financial condition and the actions it has taken to address that condition is based on GAO’s prior work, including the 2025 High-Risk Update. GAO’s description of USPS’s service performance is based on GAO’s prior work and recent reports from the USPS Office of the Inspector General and the Postal Regulatory Commission.

What GAO Found Congress and the executive branch have taken steps to improve the transparency of information on federal spending and programs. However, GAO has found that challenges remain in various areas and has made recommendations to federal agencies and Congress to help address them. Federal spending data transparency. Agencies are required by law to report federal spending data to USAspending.gov, the government’s official public source of such data. While progress has been made to improve the data on USAspending.gov, GAO has continued to identify challenges. For example, federal agencies do not consistently report spending data for other transaction agreements—legally binding agreements other than standard contracts or grants that are not subject to certain federal acquisition laws and requirements. GAO also has identified issues with the completeness and accuracy of data on USAspending.gov describing subawards—awards provided by a recipient to a subrecipient to carry out part of a federal award. Improper payments. Improper payments—those that should not have been made or were made in the incorrect amount—have been a longstanding and persistent issue for the federal government. For fiscal year 2025, 15 federal agencies reported an estimated total of $186 billion in improper payments across 64 programs. However, that estimate does not include certain programs that agencies have determined are susceptible to significant improper payments and does not represent the full extent of government-wide improper payments. Federal Program Inventory. The Office of Management and Budget (OMB) is required to develop and update annually an inventory of federal programs on a publicly available website. In recent years, OMB has made progress developing a complete inventory. However, the inventory does not yet include all federal programs—such as acquisitions, defense, or foreign assistance programs—or provide all required information—such as each program’s contribution to its agency’s mission and goals. Freedom of Information Act (FOIA) request processing. FOIA seeks to improve public access to government information and requires agencies to provide the public with access to certain government records. Federal agencies have faced persistent challenges processing requests within required time frames, resulting in government-wide FOIA request backlogs. Improving the transparency of information on federal programs and spending is foundational for increasing the efficiency and effectiveness of the federal government as well as addressing persistent management challenges, such as preventing fraud and reducing improper payments. In addition, expanding the quality and availability of federal spending data opens the potential for federal program managers to make data-driven decisions about how they use government resources to meet agency goals. Improving transparency also provides taxpayers with key information on how their tax dollars are spent. However, to realize this promise, agencies need to continue to take steps to improve the transparency of federal programs. Congress can play a critical role by acting on needed legislation and continuing to exercise active oversight. Why GAO Did This Study The federal government is one of the world’s largest and most complex entities. About $7 trillion in outlays in fiscal year 2025 funded a broad array of programs and operations. Access to quality data on federal programs and spending is important for policymaking, oversight of federal dollars, and fostering public trust in government. It is also important for assessing whether federal agencies are meeting program objectives, for identifying and reducing fraud and improper payments, and for providing transparency to taxpayers on how their tax dollars are spent. This statement highlights efforts to improve the quality, transparency, and accessibility of information on federal programs and spending, as well as remaining challenges that require additional attention. The statement is based on prior reports from GAO’s large body of work on federal spending data transparency, improper payments, implementation of the Federal Program Inventory, and FOIA.

What GAO Found GAO’s work continues to make an impact. Executive branch agencies use GAO’s work to improve their operations, performance, and efficiency, and Congress uses it to inform key legislative decisions. For example, consistent with GAO’s recommendation to Congress, the Ending Improper Payments to Deceased People Act requires the Social Security Administration to permanently share its Death Master File with the Department of the Treasury to help prevent payments to deceased individuals. This will save millions of dollars each year. To meet congressional demand for GAO’s work, GAO is requesting $860 million in appropriated dollars for fiscal year (FY) 2027. This is a 5.9 percent increase over the FY 2026 enacted level. GAO’s FY 2027 budget request also uses $50 million in offsetting receipts, for $910 million in total budget authority for the fiscal year. The FY 2027 budget request will support 3,210 full-time equivalents, a reduction of 4.2 percent compared to FY 2026 and 10.2 percent since the end of FY 2024. With these resources, GAO will continue to focus on the priority needs of the Congress, including five key areas of importance: advancing efforts to address fraud, waste, and abuse in federal programs; evaluating national security activities; assessing the impacts of emerging science and technology issues; assessing efforts to address evolving cybersecurity threats; and analyzing health care spending. GAO also plans to make targeted, critical investments in its information technology systems, advanced analytic capabilities, and cybersecurity. To help drive efficiency, an important focus will be increasing the use of emerging technology, including artificial intelligence. Background GAO’s mission is to support Congress in meeting its constitutional responsibilities and to help improve the performance and ensure the accountability of the federal government for the benefit of the American people. GAO’s work spans the full breadth and scope of the federal government’s responsibilities. Congress relies on GAO’s nonpartisan, objective, and high-quality work to help inform congressional deliberations as well as oversight of the executive branch. GAO routinely conducts work for the Chairs or Ranking Members of over 90 percent of all standing committees. Since 2002, GAO’s work has resulted in over $1.51 trillion in financial benefits and almost 30,800 program and operational benefits that helped create or change laws, improve public safety and other services, and promote better management throughout the government. For more information, contact Dave Powner at pownerd@gao.gov.

What GAO Found From fiscal years 2022 through 2024, the Department of Homeland Security (DHS) granted humanitarian parole—temporary permission to stay in the United States—to approximately 259,000 Ukrainians and their eligible family members. The Department of Health and Human Services (HHS) received $3.78 billion across three Ukraine supplemental appropriations in fiscal years 2022 through 2024 to provide refugee assistance to Ukrainians granted humanitarian parole and other eligible populations. Refugee assistance can include short-term cash and medical assistance, as well as supports like employment services and language training. Nationwide, about 135,000 Ukrainian parole beneficiaries received refugee assistance through programs administered by HHS in fiscal years 2022 through 2024 based on the most recent data available. The number served in each state ranged from fewer than 50 to over 24,000. Number of Ukrainians Granted Humanitarian Parole That Received HHS Refugee Assistance by State, Fiscal Years 2022–2024 Combined Selected state agencies and other HHS grantees GAO interviewed reported conducting outreach to Ukrainians and providing assistance with initial resettlement, housing, and legal services. Grantees also reported expanding service availability to underserved geographic areas and sometimes providing remote services. HHS allocated almost half of the appropriated funds ($1.79 billion) based on population estimates of Ukrainians granted humanitarian parole and the remaining funds ($1.99 billion) based on estimates of other populations eligible for services from HHS, such as certain eligible Cubans and Haitians. It allocated most of the funds to state-administered programs that provide cash and medical assistance and refugee support services, such as employment services, language training, and case management. HHS generally oversaw grantees serving Ukrainians within its existing framework for program oversight. HHS required grantees to report certain program and financial information, reviewed grantee reports and data, and conducted program monitoring reviews. GAO searched 31 selected monitoring reports from fiscal years 2022 through 2024 for findings specific to Ukrainian beneficiaries or instances of fraud overall. Across the selected reports, GAO identified one corrective action specific to serving Ukrainians, in which HHS required the grantee to update its eligibility training curriculum. Why GAO Did This Study Russia’s February 2022 full-scale invasion of Ukraine has caused devastating loss of life and a humanitarian crisis. Almost 6 million people have fled Ukraine as of December 2025, according to the United Nations High Commissioner for Refugees. The Consolidated Appropriations Act, 2023, includes a provision for GAO to conduct oversight of refugee assistance provided under Ukraine supplemental appropriations. This report addresses who Ukrainian parole beneficiaries are, the HHS refugee assistance they received, how HHS allocated refugee assistance funds from Ukraine supplemental appropriations, and how HHS provided related technical assistance to and oversight of states and other grantees. GAO reviewed relevant federal laws and regulations, including the Ukraine supplemental appropriations. GAO also reviewed related HHS policy guidance, monitoring reports, and other documents. GAO analyzed HHS financial data from fiscal years 2022 through 2025 and program data from fiscal years 2022 through 2024, based on availability. GAO also analyzed available DHS data on the number of Ukrainians and their eligible family members paroled into the United States in fiscal years 2022 through 2024. Additionally, GAO interviewed HHS officials, officials from three states, and representatives from five national resettlement agencies that served large numbers of Ukrainian beneficiaries. For more information, contact Kathryn A. Larin at larink@gao.gov.

Why This Matters Chemical fertilizers account for up to 45 percent of input costs for some crops. Engineered biofertilizers may reduce these costs and increase crop yields. Key Takeaways Engineered biofertilizers are made of microbes and other organic materials that improve nutrient supply in soil. The lack of a clear definition for biofertilizers leads to uncertainty about whether existing regulations apply. Current regulations may also not be equipped for genetically engineered microbes, which may hamper U.S. competitiveness. The Technology What is it? Biofertilizer technology uses organic materials, such as microbes (bacteria, fungi, and algae) to make agricultural products that enhance plant growth, improve soil health, and increase nutrient supply. Engineered biofertilizers use genetic engineering and combine multiple strains of microbes to improve these effects. These products may increase crop yield by 5 to 20 percent, although results vary by crop and local conditions. How does it work? Biofertilizers are typically applied to seeds as a coating or to soil as a powder or liquid. They work through several direct and indirect mechanisms (see figure). For example, biofertilizers can convert soil nutrients, such as potassium and phosphorus, into soluble forms accessible to plants. With genetically engineered biofertilizers, microbes are altered to be more effective. For example, tools such as CRISPR (a gene-editing technology) can be used to transfer a beneficial trait from one microbe species to another or to tailor a microbe for specific crop types or environments. How Biofertilizers Work – Selected Mechanisms How mature is it? Biofertilizers have been used in commercial agriculture since the 1890s. We identified two engineered biofertilizers containing genetically engineered microbes introduced in the 2020s. While engineered biofertilizers appear promising in the lab, real-world effectiveness is unclear. According to researchers, biofertilizers containing multiple strains of microbes can enhance plant health more than single-strain formulations can. Researchers have also found that genetic engineering can help to design and optimize various strains to work synergistically to enhance biofertilizer effectiveness. Studies suggest that biofertilizer use is more widespread in some South American countries than in the U.S. For example, Brazil uses biofertilizers in general on over 90 percent of its soybean acres, compared to 15 percent in the U.S. A 2020 study estimated that Brazil’s biofertilizer use provides over $15 billion in net savings annually on nitrogen fertilizer. The biofertilizer market is growing. According to a market intelligence firm, in 2025, the U.S. market stood at $640 million and is expected to reach $1.3 billion by 2031. In contrast, the U.S. chemical fertilizer market is expected to exceed $39 billion by 2031. Opportunities Economic benefits. Fertilizer costs have increased due to tight global supplies, energy shocks, and trade disruptions.Increased crop yields and reduced fertilizer costs could mean more profit for U.S. farmers. Because biofertilizers can reduce the need for chemical fertilizers, they may reduce the effect of price volatility, including for nitrogen and other fertilizers that can be derived from critical minerals, such as potash and phosphate rock. Environmental benefits. Biofertilizers may improve soil health and mitigate pollution by reducing the amounts of chemical fertilizers used and their associated runoff. Runoff can flow into rivers and oceans, causing harmful algal blooms and dead zones, which threaten human health and fisheries. Challenges Regulatory uncertainty. The U.S. lacks a clear regulatory definition for biofertilizers, which leads to uncertainty about whether they are subject to existing regulations. Failing to follow regulatory requirements can be costly for manufacturers. For example, the Environmental Protection Agency, in 2020, levied a $300,000 penalty under the Federal Insecticide, Fungicide, and Rodenticide Act to one company selling an unregistered biofertilizer. Regulation of engineered microbes. Researchers believe that the current U.S. regulatory system is not well equipped to regulate genetically engineered microbes, leading to a large burden on industry, which may impede innovation and further complicate reviews of biofertilizers that use these microbes. Unclear cost-effectiveness. In 2023, an industry survey found that farmers not using biofertilizers would use them if their profitability could be demonstrated. This survey also found that the lack of widespread acceptance of biofertilizers was associated with a need for further education. Policy Context and Questions What could improve the quality and reliability of engineered biofertilizers? How effective are engineered biofertilizer products in protecting U.S. farmers from the impacts of fertilizer price increases and volatility? To what extent can existing regulatory frameworks support effective development and use of new and existing engineered biofertilizers? Selected GAO Work Precision Agriculture: Benefits and Challenges for Technology Adoption and Use, GAO-24-105962. Selected Reference Esraa E. Ammar, Hadeer A. Rady, Ahmed M. Khattab, et al.. “A comprehensive overview of eco-friendly bio-fertilizers extracted from living organisms.” Environmental Science and Pollution Research, vol. 30 (2023), https://doi.org/10.1007/s11356-023-30260-x. For more information, contact Sarah Harvey at HarveyS@gao.gov.

What GAO Found In the 2025 filing season, the Internal Revenue Service’s (IRS) tax return processing and customer service performance were similar to prior years. IRS did not meet its 13-day goal to process paper returns but took fewer days to do so in 2025 (16) than in 2024 (20). IRS also answered about 9 million phone calls in both years. IRS’s backlog of taxpayer correspondence remained above pre-pandemic levels at the end of filing season and fiscal year 2025 as IRS continued to struggle balancing demands of phone service and correspondence. But IRS does not have a plan to reduce the backlog. Without a plan, IRS risks not effectively reducing its backlog and may provide less timely service to taxpayers. In 2025, IRS experienced large-scale changes to its workforce. IRS adjusted operations to comply with new directives, including return to in-person work. IRS data show that 17,047 employees—around 17 percent of IRS’s workforce as of January 2025—left IRS via deferred resignation and early retirement programs in 2025. This included 5,162 filing season staff in units that process returns and provide customer service. However, the 2025 filing season was mostly insulated from these changes. IRS required filing season staff who accepted deferred resignation or early retirement to stay until after the filing season. IRS officials told GAO that IRS is developing a new strategic workforce plan to align with the current administration’s priorities, and its prior plans are on hold. If IRS’s new plan does not address its workforce challenges, IRS will be unable to systematically identify future workforce needs and strategies for related goals. IRS 2025 Separations via Deferred Resignation and Early Retirement Programs Note: For more details on IRS’s 2025 separations data, see figure 9 in GAO-26-108116. IRS had vacancies and turnover in leadership roles throughout 2025, including having seven different commissioners through August. IRS officials were uncertain about the status of some workforce changes like agency reorganization plans, and some modernization efforts for filing season functions have been in flux, such as activities to digitize paper documents. However, IRS lacks a team that is responsible for day-to-day management of agency reforms and ensuring quality information is shared across IRS. Without such an implementation team, IRS may struggle to ensure that reform efforts are successful and sustainable, which could in turn hinder IRS’s ability to provide quality services to taxpayers. In addition, in December 2025 amid implementing the One Big Beautiful Bill Act (OBBBA), an IRS internal report stated that critical technology systems would not be ready for the 2026 filing season start. It also stated that return processing and customer service functions would enter the season undertrained or understaffed, which could result in errors and poor service for taxpayers. Why GAO Did This Study During the annual tax filing season, IRS processes millions of tax returns and issues hundreds of billions of dollars in taxpayer refunds. IRS also provides customer service to tens of millions of taxpayers. IRS carried out the 2025 filing season and its plans for 2026 during a time of swift, immense change for the federal workforce. IRS’s workforce changes and recent tax law changes could exacerbate the agency’s long-standing challenges to process tax returns on time and meet customer service demands. GAO was asked to review IRS’s 2025 filing season performance. This report assesses IRS’s (1) staffing levels and processing and customer service performance during the 2025 filing season, and (2) through the end of fiscal year 2025, and (3) workforce planning and modernization efforts for future filing season operations. GAO reviewed IRS and Department of the Treasury documentation, executive orders, and OBBBA tax provisions. GAO analyzed IRS staffing and performance data related to tax return processing and customer service during and after the 2025 filing season. GAO visited one IRS processing facility and interviewed IRS officials and stakeholders from three tax industry groups.