Trouble at the Treasury

💰 The IRS will face “enormous challenges” during this year’s tax filing season, Treasury Department officials told reporters yesterday, warning of potential delays to refunds and other taxpayer services. 

• The agency cited factors that include budget cuts, the ongoing pandemic, and federal stimulus payments complicating last year’s returns.
• Officials also revealed the IRS is entering filing season with a large backlog of unaddressed returns. While the agency usually has ~1 million such returns, the number stood around 8.6 million in November 2021.
• National Taxpayer Advocate, an independent watchdog group, found the IRS ended the 2021 filing season with more than 35 million unprocessed individual and business tax returns, a three-fold increase from the previous year.
• During the first half of last year, there was one IRS staffer for every 16,000 calls to the agency. Only 9% of calls to the agency's hotline last filing season were answered by a customer service rep, and the answer rate of the 1040 support line for individual income returns stood at just 3%.

+The bottom line: According to the Treasury, those seeking a quick turnaround should file early, file online, and request their refund via direct deposit. Tax season this year runs from January 24 through April 18.