After months of updates on how to process the backlog and lowering expectations, the Internal Revenue Service (IRS) finally has some good news for taxpayers who have been waiting endlessly for refunds. The agency is about to process all 1040 tax returns.
not too well All from them. Only those who filed last year. But at least it is progress.
In an update on Tuesday, the agency Said it was on the track To complete its backlog of individual returns filed in 2021 by the end of this week, provided there is no error in the return. As we’ve written about in the past, the IRS started 2022 with millions of unprocessed paper returns, due to a confluence of factors including outdated technology, understatement and COVID-related office closures. Paper returns are cumbersome for the agency because – despite the fact that we are living in the year 2022 – humans still need to input those returns by hand.
The situation has produced monstrous mountains of paper in IRS processing centers, as well as increased demand for more money to modernize its systems. According to National Taxpayer Advocate, simple scanning techniques can seriously speed things up by reducing the need for manual input.
Without funding from Congress, however, the IRS must continue to do some things the old-fashioned way. Today’s update at least indicates that things are heading in the right direction.
“As of June 10, the IRS had processed more than 4.5 million of the more than 4.7 million individual paper tax returns received in 2021,” the agency said. “The IRS has successfully processed the vast majority of tax returns filed this year: in total more than 143 million returns have been processed, with approximately 98 million refunds being issued, totaling more than $298 billion. “
For the better part of the past two years, social media platforms and message boards dedicated to IRS issues have been filled with posts from taxpayers who say they’ve been waiting for tax refunds from last year or so, many people said. They have complained that they are not able to contact the agency over phone.
Today’s announcement will be welcome news to some, though it effectively doesn’t matter much to taxpayers whose returns have been flagged for review because of errors or other irregularities. The good news is that the IRS has said it is expediting that process as well. Till last week, 360,000 returns were awaiting correction, compared to 8.9 million returns at this time last year.
According to the IRS, employees will continue to work overtime for the rest of this year to address remaining unprocessed returns. With luck, they will end before next April.