As the U.S. economy recovers from the disruption and damage of Covid-19, the Internal Revenue Service is struggling through a filing season unlike any other in history. The agency is under tremendous strain thanks to the enormous extra burden associated with sending out three rounds of stimulus checks; coping with other pandemic-related changes to the tax code (such as the belated exemption of the first $10,200 in 2020 unemployment benefits from federal tax and new tax credits for employers); staffing shortages; the challenges of remote work by its own employees and a leftover backlog of still unprocessed 2019 paper tax returns.
That’s not to mention the abnormally high number of 2020 individual 1040s that will require special manual processing through the IRS’ so-called Error Resolution System (ERS) thanks to Congress’ decision to allow taxpayers to use their 2019 income—instead of their 2020 numbers—to claim the Earned Income Tax Credit or Additional Child Tax Credit for 2020.
All those factors are contributing to a growing backlog and frustrating delays for many taxpayers. “From a taxpayer’s perspective, it feels like their return has fallen into a black hole: they do not know what is going on, when they will get their refund, why it is being delayed, or how to get answers or help,” National Taxpayer Advocate Erin Collins wrote in a blog post last week.
Here are 10 numbers that sum up the scope of the IRS’s challenges right now.
7 in 100
That’s the tiny portion of calls the IRS is answering this filing season on its toll-free account management help lines, the national taxpayer advocate said. The agency has reported an official “level of service” of just 14% for the 115 million calls it has received on those lines overall.
2%
That’s the portion of calls the IRS is answering on its 1040 help lines—the lines that deal with individual tax returns—as of April 10, according to the taxpayer advocate’s blog post. That means that just 1 in 50 callers is getting through to a representative for help with an individual return. The IRS has reported an official “level of service” of 5% on those lines.
20 minutes
That has been the average hold time for the one in 50 taxpayers who is lucky enough to get through to the IRS’s 1040 lines for telephone assistance.
300%
That’s how much calls to the IRS’s accounts management phone lines have increased this filing season, the taxpayer advocate said. IRS Commissioner Charles Rettig told the Senate Finance Committee earlier this month that the agency had planned to hire an additional 5,000 customer phone representatives this year to help improve those numbers, but so far has only been able to hire 3,800 new employees due to low numbers of applications and delays in fingerprinting because facilities are closed during the pandemic.
29 million
That’s how many returns the IRS is now holding for some sort of manual processing, the national taxpayer advocate reported. That includes eight million individual returns awaiting extra error resolution, another 5.3 million paper 1040s from 2019 and 2020, 4.7 million individual returns flagged with errors or fraud alerts that need a response from taxpayers and 11 million business and other types of returns. “As one would expect,” Collins wrote, “IRS employees are stretched thin working through the manual processing of these returns, so if a taxpayer’s return is pulled for manual processing, there will be delays.” Collins told TaxNotes last week that this backlog is likely to last at least until summer.
2 million
That’s how many tax returns from before the current filing season were still in the IRS’s pipeline as of March 26.
21 days
That’s how long the IRS says on its website it normally takes to process electronically filed individual tax returns, although some taxpayers get their refunds much faster. Many returns this year are taking much longer.
$211 billion
That’s how much the IRS had sent out in individual tax refunds for the 2021 filing season as of April 16, according to data released by the agency. That money was distributed across 73.3 million returns. The average refund was $2,873.
$1.2 billion
That’s how much extra money President Biden wants to add to the IRS’s budget in the 2022 fiscal year—a 10.4% bump. That money is intended to both improve service and step up tax enforcement for high-income taxpayers and big corporations.
21 days
That’s how long until this year’s delayed deadline for filing 2020 individual tax returns on May 17.