Yeah but how do you get the information from the IRS into the systems that manage this hypothetical program?

Quite honestly, there should be various options. I guess IRS could run such a program itself. Alternatively, the US has SSNs as a universal ID and IRS could send over required data organized by SSN.

What about people who don’t file taxes?

I don’t know but that’s probably solvable.

The risk is that all that work falls on the applicant. Or if the program administrators do all that work, that’s where the overhead costs come in.

I am not convinced by that. An administrator-run program with a simple methodology and a good data basis might be a lot more efficient than an application-based program inviting human error and long back-and-forths.