Massive IRS Backlog Continues to Delay Millions of Refunds for Americans

Millions of Americans are still waiting for their tax refunds to appear in their mailboxes or bank accounts months after rushing to meet the May 17 deadline.

And for some, the wait can take a long time. In early September, the IRS was still processing 8.5 million individual returns.

In a typical year, the tax agency takes about three weeks to process returns and pay refunds. But it’s not a typical year. Even an advocacy group created to help taxpayers has been crippled by the backlog.

If you were relying on quick repayment to help cover household expenses or pay off debt, you may need to look for other options.

How long you may have to wait

The IRS has been unable to keep up for a number of reasons related to the pandemic: a labor shortage, technology gaps, and a backlog of unprocessed paper returns from 2019.

The agency says it processed all error-free returns received before April, but is still working on those that need to be manually reviewed due to errors.

In some cases, the IRS says it can take up to 120 days to issue refunds because it has to correct “many more errors on tax returns than in previous years”.

Many of these errors relate to the extended children’s credit, missing information or identity theft or suspected fraud.

Returns are processed in the order they are received, says the IRS, which tries to minimize delays by redirecting returns and taxpayer correspondence from overdue facilities to those where more staff are available.

Where can you get help?

The Taxpayer Advocate Service (TAS), an independent office established within the IRS to help taxpayers resolve problems, can be a source of help. The group, however, is facing a backlog of its own.

“Due to the high volume of appeals and cases we have received, we have struggled to meet our own deadlines and expectations,” said national taxpayer lawyer Erin M. Collins in a recent blog post.

The story continues

The TAS says its workload has increased by more than 50% over the past five years – due to a higher workload, a smaller budget and reduced staff. This year, he expects 253,000 cases, against 167,000 in 2017.

If you’ve tried calling the office for help, you’ve probably felt a stalemate. Taxpayers, on average, must wait 80 minutes before reaching a representative.

This level of service is “unacceptable, especially for a function that is supposed to be the taxpayer’s safety net,” Collins said.

What else can you do if the IRS still owes you money?

Collins, for his part, offers little advice to consumers other than being patient.

“Our goal is to improve our response time, our completion dates and our ability to assist taxpayers, but we ask for your understanding as we resolve our backlog and resume providing the high levels of service that taxpayers deserve.” , she says.

The IRS encourages taxpayers to research their personalized refund status by viewing the “Where’s My Refund” tool on its website. You can also view your account.

If you filed electronically and received a receipt, you don’t need to take any further action. And it won’t help you file your taxes a second time. But if the IRS asks you a question or requests additional information, don’t dwell on your answer.

Collins says that over the past year, his office has streamlined procedures to help move cases through the system. The service’s low-income taxpayer clinics were also allowed to help with tax preparation so taxpayers could receive stimulus checks and child tax credit payments.

If your income has declined during the pandemic, you can get free or low-cost help from one of these clinics, which typically assist with IRS tax disputes like audits and appeals.

What if you need help right away?

The average tax refund in 2020 is $ 2,827, and many Americans are relying on that money to pay their bills or pay off credit card debt that has increased since the start of the pandemic.

If you can’t wait for your refund, there are other steps you can take to free up the money.

• Some auto insurers are offering customers a break if they don’t drive as much as they did before the pandemic. If yours doesn’t budge, look for a better deal.

• If you’re a renter, more than $ 46 billion has been set aside to help Americans behind on rent due to pandemic-related job losses, layoffs and pay cuts – and most of it that money is still available.

• If you’re a homeowner, refinancing your mortgage at today’s low rates and getting a better deal on your home insurance can easily save you hundreds of dollars a year.

• High interest credit card debt can quickly become overwhelming. A low interest debt consolidation loan can help you lower your interest costs and pay off your debt faster.

• Make sure you aren’t paying too much when shopping online. You can download a free browser extension that will scour the web for better prices and coupons before you checkout.

• It might be hard to imagine, but generating additional income through the stock market can be affordable and easy. A popular application allows you to invest your “spare currency”, turning pennies into a diversified portfolio.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.