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IRS Tax Refund Delays Are Likely in 2022: Taxpayer Advocate

IRS Tax Refund Delays Are Likely in 2022: Taxpayer Advocate
Written by Publishing Team

Tax season is set to officially begin on January 24. According to the Tax Advocate Service, an independent watchdog and advocacy group within the IRS, “the outlook for the upcoming filing season is bleak.”

The comments came in the group’s annual report to Congress, released by its president, national taxpayer attorney Erin M. Collins, on Wednesday. While it acknowledged the quick work the IRS did last year on the child tax credit and stimulus check payments, it did not mitigate the agency’s shortcomings. Collins described 2021 as “the most difficult year taxpayers and tax experts have ever faced.”

To date, the IRS is still handling millions of 2021 tax returns, unprocessed forms, and unanswered customer service requests. It is struggling to deal with pandemic programs such as stimulus checks and child tax credit payments. He is underfunded and confused. There is a good chance that all of this will lead to more chaos.

Revenue backlogs and the IRS’ meager budget are among the many factors likely to “negatively affect the 2022 filing season,” according to the report.

Case in point: The IRS is struggling to deal with the “historic” level of calls from confused taxpayers. Last year, only 11% of the 282 million phone calls the IRS received were answered by representatives.

Even more disturbing: the report used the word “delay” 277 times. In fact, she said, “the unprecedented handling and refund delays that taxpayers are experiencing in 2021 could be as bad, and possibly worse, in 2022” if some improvements are not made.

How to Avoid Tax Refund Delays in 2022

Don’t necessarily panic. Several tax returns and refunds have sailed through the IRS system without incident last year. The problem is that they didn’t really he did not do.

Typically, the IRS issues 90% of refunds within 21 days of receiving someone’s tax return. But as of December 23, the IRS had 6 million unprocessed individual returns; For those who have errors or who require special processing by IRS personnel, refunds can take up to 120 days, according to the agency. There are still over 2 million modified returns, which can take more than 20 weeks.

Collins has recommended a plethora of solutions, and it’s clear that the IRS is trying to get back up to speed as best it can. “IRS teams have been working nonstop for the past several months to prepare,” Commissioner Chuck Rettig said in a recent press release.

But there are steps you can take to increase your chances of getting your money back in a timely manner.

First, file your taxes electronically (if you can). Last year, the IRS got more than 17 million income tax returns on paper, some of which took “at least eight months” to process, according to the report.

Depending on your income level, you may qualify for the IRS Free File Program, which allows Americans to file their federal taxes for free using an online tax preparation service. The tax day deadline is April 18 for most people this year, and the sooner you apply, the sooner you can (in theory) get a tax refund.

Second, check your numbers. Arithmetic errors take time to resolve from the IRS. The report specifically highlights how people who do not settle items such as third stimulus checks and child tax credit payments may face delays.

To do this, you’ll want to look up Letters 6475 and 6419 from the IRS, which are mailed now. They’ll display how much money you’ve received and provide instructions on how to claim credits for any money you think you’re still owed.

Third, sign up for direct deposit. Taxpayers with direct filing information on file with the IRS usually get refunds faster than those who have to wait for paper checks in the mail. It’s secure, and you can split the refund between accounts if you like. In addition, it will assist you with any future stimulus checks and/or child tax credit payments owed to you.

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