IRS would have delays in tax refunds this year
Tax season is just around the corner and the Internal Revenue Service (IRS) expects the agency to experience delays in the distribution of tax returns.
It's not the first year it's happened. Last year, the agency postponed the start of the tax period a month after Congress approved a plan that gave more time to adjust to changes in the tax code, reported La Opinion.
The changes also required the IRS to reprocess millions of returns that had been filed prior to the legislation's passage.
In addition, additional responsibilities such as child tax credit distribution strained the agency's capacity, compounding problems it was already facing.
This year the IRS will begin processing tax returns on January 24, but due to the pandemic, many taxpayers could face delays in receiving their refund.
Within the IRS is the Office of the National Taxpayer Advocate (NTA), which supports the public by ensuring that the agency carries out its mandate fairly and effectively.
In the office's annual report submitted to Congress, they detail the IRS's efforts in 2021, saying it was "the most challenging year taxpayers and tax professionals have ever experienced."
Last year, due to additional tax credits and benefits that can be claimed, more people filed a return and about 77 percent were able to receive refunds.
The report noted that processing delays for tens of millions of taxpayers translated into delays in refunds.
It also highlights how paper tax returns have created a slower functioning federal agency that has continued to grow in recent years.
The agency has reported that, through December, the backlog has reached more than 6 million original individual returns, 2.3 million amended individual returns, more than 2 million unprocessed quarterly employer tax returns, and about 5 million pieces of taxpayer correspondence.
“Paper is the kryptonite of the IRS, and the agency is still buried in it,” said National Taxpayer Advocate Erin M. Collins.
Collins has also stated that "the number of returns suspended and requiring manual processing is likely to be high again in 2022" because the tax landscape remains more complicated than in previous years.
Author: MiamiDiario JM 7:04 am