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February 03, 2022

IRS to Add 1,200 Employees as Agency Confronts Delays and Backlog

The Internal Revenue Service is temporarily re-assigning 1,200 employees to the frontlines of a challenging 2022 tax season to deal with a daunting backlog of last year’s paper returns and mail from taxpayers.

People who have worked as customer service representatives, tax examiners, and clerks in the IRS’s “accounts management” operations during the last two fiscal years are some of the existing staffers that the tax collection agency is gathering for its “Inventory Surge Team,” IRS Commissioner Charles Rettig explained in a message to staffers on Wednesday evening.

“This is an all-hands-on-deck situation to help people as quickly as possible, and reduce the stress on employees who have been and continue to face unprecedented levels of inventory to be worked,” Rettig’s message said.

The IRS is looking at various ways to help taxpayers and the temporary reassignment of 1,200 employees is one way to do it, a spokesman said. The employees will remain in their re-assigned roles through September, he said.

The IRS had almost 82,000 workers in the fiscal year 2021, including 10,530 temporary and seasonal staff, according to agency data. Though staffing has increased in recent years, they are still below the 2010 level, the data noted.

Pandemic-related backlog

The “inventory” being mentioned is the pandemic-related backlog of hard copy unprocessed 2020 income tax returns, amended returns, and mail.

By late December, the IRS had 6 million unprocessed individual returns, 2.3 million unprocessed amended returns, over 2 million unprocessed quarterly tax returns from employers, and 5 million pieces of correspondence from taxpayers, National Taxpayer Advocate Erin Collins said last month.

“Paper is the IRS’s Kryptonite, and the agency is still buried in it,” Collins said at the time.

Last month, the IRS said it would stop sending a certain type of notice in an effort to avoid taxpayer confusion. Though tax professional groups say the IRS has the power to halt more automated notices — which will cut down on mail and tamp down confusion — the agency has said it needs law changes first.

The IRS temporarily shut down operations during the pandemic’s early months. Meanwhile, it distributed three rounds of stimulus checks, six months of Child Tax Credit advance payments last year, and carried out two tax-filing seasons in 2020 and 2021.

The IRS is still coping with the “lingering effects” of all that work, Rettig said in his message.

The Biden administration has been pushing for $80 billion in extra funding to the IRS for over a decade. The cash infusion was one part of the president’s stalled Build Back Better bill. The social-spending initiative might get carved into smaller parts that could get through Congress, Biden said last month.

The 2022 tax season runs through April 18 and the backlog remains. Separate from the backlog, 2021 tax returns might present their own headaches. For example, refunds will likely get delayed if there are discrepancies between what a family says they’re still owed for the enhanced Child Tax Credit and what the IRS says is due.

Rettig on Wednesday said the IRS has to focus on what it has to do now and the re-assigned workers “are in the best position to provide the much-needed skills and support to serve the taxpayers represented in these inventories. The bottom line is we need this help.”

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