Rebecca R Schmidt, CPA
On July 1, 2021 Erin Collins from the Taxpayer Advocate's office released her annual IRS report. Here are the highlights that we feel are important for taxpayers to know:
• The IRS has a current backlog of 35 million unprocessed individual and business tax returns that require manual processing. This is more than 5 times as many as were manually processed in 2019.
- A little less than half of the backlog is paper tax returns awaiting processing and most of the remaining tax returns were suspended during processing and require further review.
- Ms. Collins observed that the only thing most taxpayers can do is wait for the backlog to clear!
- Also worth mentioning is that there was a sharp increase in the number of returns flagged as suspicious: 3.7 million as of May 2021, compared with just 1.3 million in all of 2019.
• The IRS received more phone calls during the 2021 filing season than it had ever received in a full fiscal year, with over four times as many calls as in the prior filing season.
- The IRS’s highest-volume phone line for individual income tax assistance clocked roughly 85 million calls, only 3 percent of which went through to a live IRS customer service representative.
Unfortunately tax preparers do not have a magical connection to the IRS so we are in the same boat as taxpayers when trying to contact the IRS. Our hope is that this will be a 2020/2021 issue and that the IRS will clear the backlog no later than 2022 Tax Filing Season.