IRS in Crisis — 24 Million 2020 Returns Left to Go

 While we’re all starting to gather records and documents for the 2021 federal income tax season, the Internal Revenue Service still has a long way to go to finish its work for 2020.

The Washington Post took a long look at what the agency has been doing with 2020 returns and found — via the IRS’s taxpayer advocate service — that close to 24 million returns will need at least one action by an IRS employee before they’re considered filed and finished.

Four million returns were suspended because of errors with stimulus payments on them. Another six million returns have correspondence that needs addressed before the IRS and the taxpayer have all issues resolved.

Several people spoke anonymously to the newspaper about what’s happening at the IRS and the issues faced by the agency. Among them are providing relief for some taxpayers, a big backlog of unprocessed returns and — the usual these days for any agency or business — hiring and training new employees.

Much of the difficulty faced by the IRS has been outlined to Congress by IRS Commissioner Chuck Rettig.

“The IRS pursued significant actions during the 2021 filing season to address the return and correspondence inventory,” he wrote. “But, because the IRS lacked the resources it needed to reduce inventory to a healthy level, we are entering the filing season with a significant inventory of unprocessed returns and correspondence.”

Old technology is a big part of the problem. Funding — Rettig said — is also an issue. It’s hard to maintain and train staff without a “multi-year investment necessary to improve our technology and operating systems.”

He also defends the backlog and says the IRS is working overtime — mandatory in this case — and he has put together what he calls a surge team to take on time sensitive issues.

“These steps are making a difference. Refunds for tax returns and amended tax returns in the inventory continue to flow out to taxpayers,” Rettig wrote to Congress. “At the same time, the IRS successfully opened the 2022 tax season two weeks earlier than the year before, clearing the way for 160 million tax returns to be processed in a timely manner. We are working hard to meet taxpayers’ continuing needs and provide relief or assistance whenever appropriate.”

Some are wondering why such a big backlog when most people file their returns electronically. Electronic returns are easily handled and — unless they’re flagged for errors or other reasons — are doing quite quickly.

Just 17 million file their returns the old-fashioned way.

Source link: The Washington Post
Source link: The Hill

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