Taxpayer advocate warns millions could face delays in having returns processed by IRS

The IRS’s taxpayer advocate testified on Tuesday that millions of taxpayers could see delays in their tax returns being processed due to an accumulation of unprocessed returns from last year.

Erin Collins warned that the 2022 tax season is already starting off with an “unprecedented” stockpile of unprocessed returns, according to the Los Angeles Times.

“This past year has been the most challenging for taxpayers and tax practitioners I’ve ever experienced,” she reportedly told the House Ways and Means Committee. “Millions of taxpayers are still waiting for their refund from last year.”

“There are millions of tax returns and pieces of correspondence that the IRS received last year but could not process,” she added, according to the Times.

Collins noted that when the IRS was forced to shut down during the beginning of the coronavirus pandemic in 2020, it resulted in the agency becoming backed up on its inventories.

“And it is still struggling to catch up,” she told the House Ways and Means Committee, according to the Times.

She also added that IRS staff at the time were required to redirect their attention toward administering various COVID-19 relief programs.

While Collins reportedly acknowledged that the agency acquired a backlog of roughly 35.3 million returns, she said that paper returns made up most of those that remained unprocessed. 

“Paper is the IRS’ kryptonite, and the agency is buried in it,” Collins said, adding that paper returns can take months to process. “Paper remains at the heart of the agency’s challenges in processing tax returns.”

Collins also told the committee that if taxpayers could struggle to get answers to questions, as only 11 percent of the nearly 282 million calls placed to the IRS are fielded by customer service representatives, the news outlet noted.

“As a result, most callers could not obtain answers to their tax law questions, get help with account problems,” she reportedly said.

According to Collins, Congress would need to supply more funding to the IRS so that it can tackle its current problems. The agency’s workforce has decreased by about 17 percent since 2010, while its workload during the same time frame has expanded by almost 20 percent, the Times reported.