Having “enormous challenges” might be considered a major understatement if an agency still has to get through 24 million tax returns from last year. But that’s exactly the predicament the Internal Revenue Service is mired in amid another coronavirus pandemic-hit tax season.

In an op-ed published on Yahoo News earlier this week, IRS commissioner Chuck Rettig acknowledged that millions of Americans are still waiting for last year’s returns to be processed and refund checks that could amount to thousands of dollars. He added that the agency will take all necessary steps to return “to normal inventory levels before next year.”

Rettig continued, “We have taken extraordinary measures to work through unprocessed returns and correspondence, including mandatory overtime by IRS employees, creating and redirecting surge teams to address the inventories, temporarily suspending certain automated compliance notices and, where possible, modernizing operating systems to accelerate the manual processing of inventories.”

“Millions are waiting for their returns to be processed, and many won’t be able to reach us when they call with questions this filing season. This is frustrating for taxpayers and for us. We want to do more, but we face great challenges,” he wrote.

Staffing Issues Abound

Rettig also noted that the IRS is dealing with acute staffing shortages. Compared to 2010, the agency has roughly 20,000 fewer employees and 20 percent less funding when adjusted for inflation, according to the Congressional Budget Office.

In response to the challenges, the IRS recently made the decision to temporarily reassign about 1,200 employees to the frontlines of a daunting tax season to help out with the massive backlog.  

“Without long-term, predictable funding, the IRS will continue to face severe limitations, unable to provide the service taxpayers deserve and need,” Rettig wrote.

National Taxpayer Advocate Erin Collins recently issued a report to Congress further detailing the tax agency’s ongoing staffing issues and backlogs. The report stated that she is “deeply concerned about the upcoming filing season.” The remaining unprocessed returns are from the “most challenging year taxpayers and tax professionals have ever experienced,” she continued.

More Complex Returns

Making matters worse this particular tax season is the fact that the IRS needs to double-check any reporting mistakes associated with the enhanced child tax credits and the third stimulus checks.

Taxpayers “should pay extra attention if they received Economic Impact Payments or an advance Child Tax Credit in 2021,” Rettig claimed. “The IRS has sent out more than 150 million information letters this year. This will help assure information is reported accurately,” he added.

The IRS so far has issued 4 million tax refunds worth about $10 billion. The average refund comes in at roughly $2,200.

Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.

Image: Reuters.