The IRS estimates that nearly 1.6 million taxpayers will receive more than $1.2 billion worth of penalty relief. The tax agency will automatically issue the refunds or credits for most of the fees by the end of September.
Treasury Secretary Janet’s memo, obtained by The Associated Press, outlines the importance of modernizing IRS computer systems and ensuring the agency has an adequately-staffed workforce now that the tax collector is set to receive nearly $80 billion over the next 10 years.
Now that the IRS is set to receive nearly $80 billion through the so-called “Inflation Reduction Act,” the agency has the means to develop new systems to help Americans pay their taxes.
Major changes to the Affordable Care Act. The nation’s biggest-ever climate bill. The largest tax hike on corporations in decades. And dozens of lesser-known provisions.
After digging out of a daunting backlog from 2021, the agency has an even bigger backup for this tax season than it did a year ago and its pace for processing paper returns is slowing down, according to a watchdog report released Wednesday.
The GAO report, issued Thursday, found that while 70% of taxpayers were eligible for the Internal Revenue Service’s free-filing program, only 3% of taxpayers actually use the service.
Monday is Tax Day—the federal deadline for individual tax filing and payments. About 40% of this year’s taxpayers still haven’t filed a return.
Tax season can be complicated for everyone, but as the April 18 filing deadline looms, small-business owners, contractors, entrepreneurs and others face a raft of ever-changing rules and regulations.
The moves, disclosed by a senior Treasury official not authorized to speak publicly, represent the agency’s most aggressive strategy to dig out from under the massive backlog, the result of lagging operations due to the coronavirus pandemic.
A government official said the IRS does not expect to resolve the backlog until the end of 2022. But it hopes the hiring surge, the largest at the IRS in decades, will galvanize a strong response to the mountain of unprocessed paperwork at the agency.
An IRS worker shortage and an enormous workload from administering pandemic-related programs will combine to cause taxpayers pain this filing season.
The proposal to go after taxpayers who skip out on income taxes initially had potential bipartisan appeal, but outside groups came forward to lambaste it as a way to enable the IRS to snoop around Americans’ personal finances.
The support line for individual income tax returns received about 85 million calls, with only about 3% reaching a customer service representative, according to the taxpayer advocate report.
Among the proposed changes, businesses that receive “cryptoassets” with a fair market value of more than $10,000 would have to report it to the IRS.
President Joe Biden is proposing that Congress build up the depleted and often-maligned agency, saying that a more aggressive collection of unpaid taxes could help cover the cost of his multitrillion-dollar plan to boost infrastructure, families and education.
The IRS announced the decision Wednesday and said it would provide further guidance in the coming days. The move provides more breathing room for taxpayers and the IRS alike to cope with changes brought on by the pandemic.
Simple tax forms being mailed to people who never collected unemployment benefits are revealing their identities were likely stolen months ago and used to claim bogus benefits that have totaled billions of dollars across the country.
The National Consumer Law Center estimates that up to 20 million Americans who filed their taxes with an online preparation service found that their payment did not make it to them directly.
President Donald Trump announced Wednesday night that he will instruct the Treasury Department to allow individuals and businesses negatively affected by the coronavirus to defer their tax payments beyond the April 15 filing deadline.
The agency said Wednesday that it is stepping up its efforts to visit high-income taxpayers who failed in prior years to file their tax returns on time.