Tax implications far from nil for college athletes' NIL money
IRS releases drafts of 2021 Form 1040 and schedules

IRS reports progress in tax return backlog

Paper overload_cropped

Just about a month ago, the Internal Revenue Service reportedly had a backlog of more than 35 million individual and business returns that required manual processing. That was up from 29 million back in April.

Last week, however, the IRS said it's essentially caught up with early season individual filings.

Hey, don't shoot the messenger. That's the official word from the IRS, via its special IRS Operations During COVID-19: Mission-critical functions continue webpage.

In a July 23 update to a portion of the What You Can Expect section of that site, the tax agency says it "is opening mail within normal timeframes and all paper and electronic individual returns received prior to April 2021 have been processed if the return had no errors or did not require further review."

Tax ifs, ands, and buts: OK, that's a big "if" in that statement. "If the return had no errors or did not require further review" leaves the IRS a lot of tabulating wiggle room.

The IRS does not say how many of these error-ridden, review-required returns it's still working on. It did say, though, that, "As of July 17, 2021, we had 15.6 million unprocessed individual returns."

The IRS is a bit slow in updating its online filing season 2021 data. The latest entry there shows the agency has received through June 11 almost 152.5 million returns and had by that date processed slightly more than 141 million of those filings. That's a smaller unprocessed amount, just 11.4 million, than the COVID page's update.

Given the grumbling that continues, at least on Tax Twitter and other social media outlets, both return processing counts are, shall we say unexpected and, to many, overly-optimistic.

But those are the official IRS counts, and the 15.6 million is this weekend's By the Numbers figure.

Certain claims causing delays: The millions of still unprocessed filings, says the IRS, include tax year 2020 returns that require correction to the Recovery Rebate Credit (RRC) amount or validation of 2019 income used to figure the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC).

If that's your 1040, then you're likely not going to know it. What you will know is that you're still waiting for the resolution of your return. Again, from the IRS:

"This work does not require us to correspond with taxpayers but does require special handling by an IRS employee so, in these instances, it is taking the IRS more than 21 days to issue any related refund and in some cases this work could take 90 to 120 days." 

The IRS says that if it makes changes to any RRC, EITC or ACTC claims, then you'll get a written explanation.

The usual tax tracking advice: In the meantime, the IRS repeats its standard tax return status advice. Check the agency's Where's My Refund? online tracking tool.

I know, it's frustrating. And financially problematic for many taxpayers who've needed expected refunds based on their tax credit and added economic impact payment (EIP) amounts.

But frustrating has been the operative word for taxes, whether you're a taxpayer, tax professional or IRS employees, who've been given multiple new tasks during the 2020 and 2021 COVID-ridden filing seasons.

Here's hoping we all are rescued from this shared leaky tax boat soon.

You also might find these items of interest:

 

Advertisements

 

 

Comments

Feed You can follow this conversation by subscribing to the comment feed for this post.

Verify your Comment

Previewing your Comment

This is only a preview. Your comment has not yet been posted.

Working...
Your comment could not be posted. Error type:
Your comment has been saved. Comments are moderated and will not appear until approved by the author. Post another comment

The letters and numbers you entered did not match the image. Please try again.

As a final step before posting your comment, enter the letters and numbers you see in the image below. This prevents automated programs from posting comments.

Having trouble reading this image? View an alternate.

Working...

Post a comment

Comments are moderated, and will not appear until the author has approved them.

Your Information

(Name and email address are required. Email address will not be displayed with the comment.)