The Internal Revenue Service (IRS) is responsible for administering the nation’s tax system. This includes collecting taxes, providing taxpayer assistance, and enforcing tax laws. In recent years, the IRS has faced a number of challenges, including budget cuts, staffing shortages, and increased complexity of the tax code. As a result, the IRS has experienced a backlog of unprocessed tax returns and other correspondence.
Current Backlog Situation
As of the end of the 2023 filing season, the IRS had a backlog of approximately 6.1 million unprocessed tax returns. This is a significant decrease from the backlog of 16.4 million returns at the end of the 2022 filing season. However, the current backlog is still higher than the pre-pandemic level of 3.5 million returns.
The IRS is working to reduce the backlog, but it is expected to take several years to fully eliminate it. In the meantime, taxpayers may experience delays in receiving refunds, processing amended returns, and responding to correspondence.
Reasons for the Backlog
There are a number of factors that have contributed to the IRS backlog, including:
- Budget cuts: The IRS has faced significant budget cuts in recent years. This has led to a reduction in staff and resources, which has made it more difficult to process tax returns and other correspondence.
- Staffing shortages: The IRS is also facing a shortage of staff. This is due to a number of factors, including retirements, attrition, and difficulty in hiring new employees.
- Increased complexity of the tax code: The tax code has become increasingly complex in recent years. This has made it more difficult for taxpayers to file their returns correctly and for the IRS to process them efficiently.
Impact of the Backlog
The IRS backlog has a number of negative consequences for taxpayers, including:
- Delays in receiving refunds: Taxpayers who are due a refund may experience delays in receiving it due to the backlog. This can cause financial hardship for taxpayers who are counting on the refund to pay bills or other expenses.
- Processing delays for amended returns: Taxpayers who need to file an amended return may experience delays in having it processed. This can be frustrating for taxpayers who need to make changes to their return, such as correcting an error or claiming a refund.
- Delays in responding to correspondence: The IRS is also experiencing delays in responding to taxpayer correspondence. This can be frustrating for taxpayers who have questions about their tax return or need assistance with other tax-related matters.
What the IRS is Doing to Reduce the Backlog
The IRS is taking a number of steps to reduce the backlog, including:
- Hiring more staff: The IRS is hiring more staff to help process tax returns and other correspondence. The IRS has hired over 5,000 new employees in the past year, and it plans to hire an additional 5,000 employees in the coming year.
- Improving technology: The IRS is also investing in new technology to help process tax returns and other correspondence more efficiently. This includes new scanning and imaging technology, as well as new software to help automate tasks.
- Streamlining processes: The IRS is also streamlining its processes to make it easier to process tax returns and other correspondence. This includes reducing the number of steps required to process a return and making it easier for taxpayers to file their returns electronically.
What Taxpayers Can Do
There are a number of things that taxpayers can do to help reduce the IRS backlog, including:
- File your return electronically: Filing your return electronically is the fastest and most accurate way to file. The IRS encourages taxpayers to file electronically whenever possible.
- Use the IRS website: The IRS website has a wealth of information and resources that can help taxpayers with their tax returns. Taxpayers can use the website to get answers to their questions, download forms and publications, and make payments.
- Be patient: The IRS is working hard to reduce the backlog, but it will take time. Taxpayers should be patient and understand that there may be delays in processing their returns and correspondence.
The IRS backlog is a serious problem that is causing delays for taxpayers. However, the IRS is taking steps to reduce the backlog, and taxpayers can help by filing their returns electronically, using the IRS website, and being patient.
What the IRS backlog means for you
FAQ
How fast is the IRS processing tax returns 2024?
Why is my tax return taking so long?
How far behind is IRS processing amended returns?
Should I be worried if my refund is still being processed?
Does the IRS have a backlog?
TIGTA said the IRS is on-track to meet one of its backlog targets, but will once again operate through the upcoming filing season and accept new tax returns while processing its backlog of prior year returns. The IRS is on-target to process its backlog of about 3 million individual paper tax returns by the end of December.
When will the IRS clear a backlog of paper tax returns?
The IRS is on-target to process its backlog of about 3 million individual paper tax returns by the end of December. But TIGTA expects it will take the agency until January 2023 to clear its backlog of business paper tax returns, and won’t clear its backlog of rejected returns, unpostable returns and amended returns until June 2023.
Does the IRS have a backlog of unprocessed tax returns?
Still, it’s a vast improvement after years of backlogs and decades of underfunding. The latest update on the IRS from National Taxpayer Advocate Erin M. Collins said the agency cut its backlog of unprocessed paper tax returns by 80%, from 13.3 million returns at the end of the 2022 filing season to 2.6 million at the end of the 2023 filing season.
Why do tax returns have a backlog?
Communicating directly with taxpayers to ensure accurate returns: A large share of the backlog stems from small errors by millions of taxpayers on their tax returns, which then require manual review by IRS employees before they can be processed.