Tax Submitting: A Preliminary Overview on the IRS’s Makes an attempt to Handle Persevering with Challenges


What did Gao discover?

The IRS skilled a number of challenges in the course of the 2021 submitting season because it struggled to reply to an unprecedented workload that included offering COVID-19 aid. The IRS started the submitting season with a backlog of 8 million private and enterprise returns from the prior yr to be processed together with incoming returns. The IRS lowered the backlog of returns for the earlier yr, however by the top of December 2021, there have been about 10.5 million returns in course of from 2021. For the present submitting season, the IRS might want to course of the remaining returns from 2021, with returns coming from 2022 and should have to depend on additional time to take action. The IRS additionally expects about 21 million returns to be closed for errors associated to current tax regulation modifications.

Challenges With IRS Buyer Service Throughout the 2021 Submitting Season

The IRS answered extra cellphone calls in 2021 than in recent times, however taxpayers discovered it troublesome to achieve the IRS because of excessive name volumes. The IRS expects customer support representatives to reply roughly 35 % of incoming calls in the course of the 2022 submitting season.

To assist handle excessive name volumes, the IRS urged taxpayers to make use of its “The place’s My Refund” on-line software to acquire refund standing data. This software supplies restricted details about refund standing and delays. The GAO’s preliminary feedback point out that the IRS has no plans to modernize “The place’s My Refund,” though it might assist the IRS higher serve taxpayers, decrease name volumes, and decrease prices. In ongoing work, GAO plans to evaluation this concern additional.

The IRS was additionally struggling to reply to taxpayer correspondence. The IRS’s correspondence listing has grown to greater than 8 million by the start of 2022. The IRS expects this stock to exceed 10 million by the top of fiscal yr 2022 — greater than triple what it was on the finish of fiscal 2020. This backlog can be troublesome to handle because the IRS balances prioritizing phone calls from taxpayers with answering correspondence coming in 2022.

Lastly, private service visits have declined considerably since 2015. IRS officers blamed the continuing results of the pandemic and the decline within the possibility for taxpayers to entry providers by way of cellphone and on-line.

Why did Gao do that examine?

Throughout the annual tax submitting season, sometimes January by mid-April, the IRS processes greater than 150 million private and enterprise tax returns and supplies phone, correspondence, on-line, and in-person providers to thousands and thousands of taxpayers. To accommodate the brand new tax regulation and supply further aid to taxpayers, the IRS prolonged the 2021 private submitting and cost deadline by 1 month to Might 17, 2021.

Gao was requested to testify on the IRS’s efficiency in the course of the 2021 submitting season. This assertion summarizes the GAO’s findings from ongoing work describing the IRS’s efficiency in the course of the 2021 submitting season (1) processing private and enterprise earnings tax returns, and the implications for the 2022 submitting season; and (2) offering customer support to the taxpayers.

GAO analyzed IRS paperwork and information on season efficiency, return curiosity funds, hiring and worker additional time; and interviewed the cognizable officers. GAO additionally up to date chosen data from the March 2021 (GAO-21-251), January 2020 (GAO-20-55), and March 2019 (GAO-19-176) studies.

For extra data, contact Jessica Lucas-Judy at (202) 512-6806 or lucasjudyj@gao.gov.



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