Are you still waiting on your tax refund or stimulus check? If so, you’re not alone.
The IRS has a current backlog of 35 million unprocessed individual and business tax returns that require manual processing. This is more than 5 times as many as were manually processed in 2019!
Nearly half of the backlog is paper tax returns awaiting processing, with most of the rest being tax returns that were suspended or flagged during processing and require further review. Of the suspended returns, a large number were flagged because of discrepancies between recovery rebate credits claimed by taxpayers and what IRS records indicate the taxpayer qualifies for.
Also flagged were many returns of taxpayers who elected to use their 2019 earnings instead of their 2020 earnings to claim a larger earned income tax credit or additional child tax credit as allowed by the Cares Act. Of course, the very idea here was to quickly provide refunds where needed, but reality has meant that these poor taxpayers not only did not get the refund quickly, they also got boomeranged into a delay and still don’t have it! All they can do is wait for the backlog to clear.
Adding to the backlog is a sharp increase in the number of returns flagged as suspicious: 3.7 million as of May 2021, compared with just 1.3 million in all of 2019, according to a recent report by the National Taxpayer Advocate. Read more here >>
More Taxpayers Called the IRS Than Ever Before
Need more proof that the 2021 tax filing system process was more complex than any other in recent history?
The IRS received more phone calls during the 2021 filing season alone than it has ever received in a full fiscal year, with over four times as many calls as in the prior filing season.
The IRS’s highest-volume phone line for individual income tax assistance clocked roughly 85 million calls, only 3 percent of which went through to a live IRS customer service representative.
