Tax return season is about to begin. The IRS has faced a backlog of work



Tax return season for 2021 tax returns will begin on Monday, January 24, 2022, the Treasury Department announced Monday. But amid the ongoing pandemic and a shortage of resources at the Internal Revenue Service, Treasury officials warn that this will be a challenge for taxpayers and tax preparers who are already facing a crisis. Disappointing filing season.

Normally, the IRS would have less than 1 million entries in its backlog as it enters tax filing season, but due to complications from the coronavirus pandemic, that’s not the case this filing season. Treasury officials did not give an exact figure for the backlog but said it was substantial, many times more than 1 million.

The IRS is continuing to play catch-up from the height of the pandemic. In 2020, mail centers were shut down for a month. Meanwhile, more than 20% of the IRS customer service workforce has been unable to work due to health reasons related to the pandemic in the past two years.

At the same time, the IRS faces shrinking resources: Over the past decade, the IRS budget has been cut by nearly 20%. Under the previous administration, staffing for Taxpayer Assistance Centers was also reduced to the point where less than a third of taxpayers could receive direct IRS assistance compared with 2016.

According to Treasury officials, the IRS workforce is now about the same size as it was in 1970, despite a 60 percent increase in population. Process technology dates back to the 1960s. And there are also fewer auditors than at any time since World War II.

“In many areas, we are unable to provide the amount of service and enforcement that our taxpayers and tax system deserve and need. This is frustrating for taxpayers, for IRS employees, and for me,” said IRS Commissioner Chuck Rettig. “IRS employees want to do more and we will continue into 2022 to do everything we can with the resources available to us.”

Treasury officials are urging taxpayers to get their tax returns as soon as possible. Taxpayers do not need to wait until previous returns are processed to file their 2021 return. Tax filing season will run through April 18, 2022.

Officials are encouraging taxpayers to file electronically with direct deposit to help ensure refund issuance is not subject to processing delays. They also urge taxpayers to check for accuracy when filing – especially to ensure that stimulus payments are received and enhanced child tax credit payments are accurately reported – to avoid potential fraud. delay.

If they opted for a direct deposit and had no problems with their tax return, the IRS predicts most taxpayers will receive their refund within 21 days of electronic filing.

Reaching the IRS for inquiries will continue to be a challenge this year, the agency said. In the first half of 2021, there were less than 15,000 people to handle over 240 million calls made, which breaks down to one person per 16,000 calls. Last year, the IRS was able to answer 30 percent fewer calls it received, according to Treasury officials.

The IRS has been working to create more online tools and resources for taxpayers to help answer questions that officials have encouraged taxpayers to use.

The Biden administration is pushing for more money and resources to help the IRS. The agency received $2 billion under the US Rescue Plan, which was passed in March last year. The proposed 2022 budget calls for increasing IRS funding to nearly 15%.

Meanwhile, the Biden administration has included $80 billion in money for the IRS over the next decade as part of the Better Rebuilding Act, which will focus primarily on tax enforcement but also on services to the IRS. tax payers. That provision as part of much larger legislation could have passed in the House, but hit a wall in the Senate.

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