I did contact work with the IRS from '06-'09, on the IMF and BMF (master file system) and I assure you there are no punch cards. Old school main frame assembly yes, but no punch cards.
The last I heard CADE2, the modernized (J2EE) system, had replaced the majority of the IMF functionality (IMF is the core of tax return processing). I'm not completely sure though as I haven't talked to those guys in over 4 years now.