Congress sends bipartisan letter urging IRS to handle backlog

A gaggle of 93 members of Congress signed a bipartisan, bicameral letter to IRS Commissioner Charles Rettig to induce the IRS to keep away from delays and workers shortages forward of the 2023 tax-filing interval, and is receiving help from the American Institute of CPAs. 

“We imagine that the IRS should take further steps to enhance customer support points, lower processing delays, and work-down the backlog of paper returns and correspondence by persevering with the utmost use of time beyond regulation and surge groups, in addition to the continued suspension of automated notices and collections,” mentioned the letter, led by Sen. Bob Menendez, D-New Jersey, and Invoice Cassidy, R-Louisiana, together with Rep. Abigail Spanberger, D-Virginia, and Brian Fitzpatrick, R-Pennsylvania. 

Monday’s letter cited a Nationwide Taxpayer Advocate report stating that the IRS had a backlog of 21.three million unprocessed paper tax returns, which represents a 1.three million enhance in comparison with Might 2021. Moreover, the company was solely in a position to meet 12% of its hiring targets for customer support representatives. 

Inside Income Service headquarters in Washington, D.C.

Samuel Corum/Bloomberg

In June, Nationwide Taxpayer Advocate Erin Collins launched a midyear report back to Congress, the place she mentioned her issues about delays within the processing of paper-filed tax returns, and the way they affected taxpayer refunds. Earlier than the pandemic, it typically took the IRS round 4 to 6 weeks to ship refunds to paper filers, however over the previous 12 months, refund delays may simply exceed six months. The report mentioned the IRS must course of over 500,000 Kinds 1040 per week to erase the 2022 backlog, which is twice the present tempo. 

“The IRS’s paper processing delays have been evident greater than a 12 months in the past, and the IRS may have addressed them extra aggressively at the moment,” mentioned Collins in her report. “Had the IRS taken steps a 12 months in the past to reassign present staff to processing capabilities, it may have decreased the stock backlog carried into this submitting season and accelerated the cost of refunds to thousands and thousands of taxpayers.”

It is not the primary time that Congress acquired written suggestions to enhance the backlog and improve the shopper expertise. 

In March, lawmakers put strain on the IRS to supply additional reduction to taxpayers who’ve been receiving warning notices, and the AICPA expressed skepticism concerning the IRS’s insurance policies on delays and workers scarcity. On July 11, the AICPA submitted a letter to ask the Treasury Division and the IRS to guard professionals and taxpayers from processing delays and penalties for the 2023 tax season by offering higher stock ranges administration. 

“It is vital for the IRS to take quick steps to forestall one other tense and complicated tax season for taxpayers, practitioners and the IRS,” mentioned Edward Karl, AICPA vp of tax coverage and advocacy. “Till the backlog is really at a wholesome stage and the IRS’ service deficiencies are corrected, taxpayers and practitioners will proceed to be unfairly and unnecessarily burdened.”