A a few days before tax season begins This year, the Internal Revenue Service (IRS) is better able to process returns than it has been in recent years, a new report has released.
This year’s report from the National Taxpayer Advocate says the IRS has made significant progress in reducing its huge backlog of 4.7 million individual statements raw at the end of 2021 to 400,000 as of December 23, 2022.
According to the report, the IRS also had 3.2 million original paper statements of companies. By December 23, those numbers had dropped to 1 million.
For amended returns, the IRS reduced its order book from 2.4 million to 600,000 for individuals and from 1.2 million to 900,000 for businesses.
The IRS also reduced its inventory of mail/account management cases, that is, inquiries received by mail or phone, from 6.3 million to 5.1 million. These 5.1 million cases will carry over to fiscal year 2023, according to the report.
He further noted that increased federal fundsstaff recruitment and new digital solutions helped address deficiencies in processing and customer service.
Still, millions of American taxpayers suffered lengthy refund delays last yearand some are still waiting, with the report predicting that it will take until the middle of the year before major service improvements are seen.
Delays in refunds, a constant in 2022
In 2022, about two-thirds of individual taxpayers were eligible for tax refunds. around $3,200 on average. However, the IRS failed to pay refunds on time to millions of taxpayers for the third year in a row, according to the report.
Overall, approximately 13 million individual taxpayers filed paper returns, which faced delays of six months or moreas discovered by the National Taxpayer Advocate.
Millions more who had filed returns electronically had their returns suspended because the agency’s processing filters they did not work correctlywhich required a manual review.
Last year, the number of returns in suspended status jumped from 4.2 million to 5.9 million, due to an increase of 1.3 million cases of suspected identity theft. In mid-December, approximately 2.9 million returns were still suspended due to identity theft.
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