I.R.S. Faces Backlog, Delaying Tax Refunds for Thousands and thousands of Individuals


Millions of tax returns are still waiting to be processed by the Internal Revenue Service, which is far more backlog than in previous years.

This means that any refunds due for these Americans have also been delayed. Approximately 70 percent of single returns processed to date have been refunded, with an average size of $ 2,827.

More than 35 million federal declarations for 2020 were waiting to be processed at the end of the filing season in mid-May – more than three times as many backward declarations as at the end of last year’s filing season, according to a report published on Wednesday independent advocacy within the Internal Revenue Service.

“For taxpayers who can afford to wait, the best advice is to be patient and give the IRS time to work on its backlog,” said Erin M. Collins, national taxpayers attorney, in her semi-annual report to the Congress. “But especially for low-income taxpayers and small businesses working on the margin, delays in reimbursement can create significant financial hardship.”

The IRS said in a statement that it has continuously processed tax returns, including amended tax returns, for the current and prior years. As of June 18, it had fully processed nearly seven million individual tax returns since the end of the tax season, and more than 15 million of the backward tax returns are in some state of processing, the agency said.

The report – which also included recommendations for the IRS and a number of goals the attorney plans to pursue over the coming year – said the backlog was largely due to a pandemic evacuation order that restricted staff access to the IRS facilities. In 2019, before the pandemic began, the agency was back 7.4 million returns by the end of the sign-up season. Last year that number had grown to 10.7 million.

In addition to performing its traditional duties, the IRS had to digest tax legislation enacted in the 2021 filing season, the report said. Then there was the third round of stimulus payments, which the agency started doing in mid-March. In the past 15 months, the agency processed 475 million stimulus payments worth $ 807 billion.

The IRS processed 136 million individual income tax returns by the end of the filing season and issued 96 million refunds totaling approximately $ 270 billion. The 35.3 million returns outstanding at the end of the registration season comprised individuals and companies. The taxpayers attorney said these declarations required some sort of manual assistance, which meant an employee had to be involved before they could be moved to the next stage in the processing pipeline.