Plainly there are two very completely different views on the result of the 2022 tax submitting season. From the Inside Income Service’s perspective, issues appear to have gone fairly effectively. Ignoring in the meanwhile the backlog on 2020 tax returns, the IRS began the tax season on time and ended it on time for the primary time in three years. It processed extra returns by April 15 than it did in 2021, and issued extra and bigger refunds. The IRS was not interrupted midfiling season with extra laws impacting the tax returns already being filed. The service hopes to compensate for 2020 tax returns by the top of 2022. We aren’t fairly certain how the IRS is doing with 2021 paper returns, nevertheless it does proceed to confess that it’s affected by insufficient funding, and discovering that it’s having some bother attracting extra expertise.
From the tax practitioner perspective, nonetheless, the tax submitting season didn’t look so rosy. Ending the tax submitting season on time was not essentially a great factor. Sure, extending the submitting season creates issues when it comes to staffing and getting taxpayer data submitted in a well timed style. Nevertheless, returns have been typically extra difficult this yr, with the expanded Little one Tax Credit score and advance funds, the persevering with Financial Affect Funds and the Restoration Rebate Credit score, the persevering with charitable deduction for nonitemizers, the expanded Earned Earnings Tax Credit score, the expanded Little one and Dependent Care Credit score, and digital forex and nonfungible tokens. Tax return preparers continued to have points coping with unprocessed prior-year returns, the disconnect between IRS notices and former submissions to the service both not acquired or not learn, acquiring IRS transcripts in a well timed style, and coping with purchasers unfamiliar with a number of the adjustments required by the 2021 tax returns. Anecdotally, it seems that the variety of extension requests filed can be bigger than ever, persevering with a pattern from previous years.