Improving Digital Identity Act of 2021 This bill establishes the Improving Digital Identity Task Force to establish a government-wide effort to develop secure methods for governmental agencies to validate identity attributes to protect the privacy and security of individuals and support reliable, interoperable digital identity verification in the public and private sectors. The National Institute of Standards and Technology (NIST) shall develop and periodically update a framework of standards, methodologies, procedures, and processes as a guide for federal, state, and local governments to follow when providing services to support digital identity verification. The Department of Homeland Security (DHS) shall award grants to states to upgrade systems that provide drivers' licenses or other types of identity credentials to support the development of highly secure, interoperable state systems that enable digital identity verification. The Government Accountability Office shall submit to Congress a report that includes (1) an analysis of legal and regulatory requirements with respect to the collection and retention of Social Security numbers by nongovernmental organizations, and (2) a recommendation on the necessity and effectiveness of any such legal and regulatory requirement analyzed and the use of a form of identification other than a Social Security number. DHS shall issue binding operational directives to federal agencies to implement (1) the Digital Identity Guidelines published by NIST; and (2) the memorandum of the Office of Management and Budget issued on May 21, 2019, which includes the subject Enabling Mission Delivery through Improved Identity, Credential, and Access Management .