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urge them to implement a plan to
achieve automation of paper processing ‘The IRS has said it is aiming to crush the
in time for the next filing season,”
backlogged inventory this year, and I hope
Collins said in a preface to
the report. “Doing so is critical.” it succeeds. Unfortunately, at this point the
Without that and other innovative
approaches and better use of its existing backlog is still crushing the IRS, its employees,
resources, IRS Commissioner Charles and most importantly, taxpayers.’
Rettig’s stated goal of getting “healthy”
with respect to the backlog by the end
of 2022 “will be a difficult commitment National Taxpayer Advocate Erin Collins
to achieve,” Collins stated. The report
estimates that the Service would have
to process well over 500,000 individual On June 21, the IRS reported in its online accounts and digital channels
paper returns in the Form 1040 series own news release (IR-2022-128) that of communication with the Service.
per week, while its current rate is about it was on track to complete its process-
205,000 per week. That takes into ing of the 4.7 million original (not Hiring and training
account not only the current Form amended) Form 1040 returns it received While the Service was able to
1040 inventory but additional returns on paper in 2021 by the end of that hire 99% of its goal of 5,000
it will receive as the extended filing week and that business paper returns new employees in its Account
deadline of Oct. 17 approaches. filed in 2021 would be completed soon Management operation, a
“The math is daunting,” Collins afterward. However, the Service also corresponding plan to hire 5,473
wrote. Much of the problem arises noted that it had twice as many returns new staff members in Submission
from the paper returns’ current overall awaiting processing than at a Processing reached only 38% of
labor-intensive and error-prone similar point in a typical year, despite that goal, Collins reported. Paper
transcription methods, Collins said. having completed work on almost 1 mil- return transcribing is done only at
“Today, the digits on every paper lion more returns. the latter function’s sites at Austin,
return must be manually keystroked Texas; Kansas City; and Ogden, Utah,
into IRS systems by an employee,” she Errors and taxpayer she noted.
wrote. “In the year 2022, that doesn’t correspondence
just seem crazy. It is crazy.” If a return contains an error, Collins Telephone service
Although Rettig’s “healthy” wrote, processing it — whether or not IRS telephone operators were able
comment in a congressional hearing filed on paper — and issuing its refund to answer only 10% of taxpayer
accompanied his assurance that the can take still longer, sometimes well calls during the 2022 filing season,
Service would clear its backlog by over a year. If the IRS adjusts a return, marginally better than their 9% in
year’s end, Collins noted that he did it generally must correspond with the 2021 but with fewer than half as many
not define “healthy.” She suggested a taxpayer and allow a reply — generally, incoming calls (73 million in 2022
less ambitious measure than becoming both by postal letter. As of May 21, through April 23, versus 167 million
current with all inventory, one 2022, the IRS took an average of 251 in 2021 through May 21, 2021). The
keyed to how quickly taxpayers can days — more than eight months — in average wait time on hold increased
receive refunds. such instances, which was more than from 20 minutes to 29 minutes.
“From a taxpayer perspective, triple the 74 days in fiscal 2019, before “If a private company failed to
returning to a four- to six-week the pandemic. answer nine out of 10 customer calls,
refund delivery period is a reasonable The IRS should also remove customers would go elsewhere,”
definition of ‘healthy,’ ” Collins wrote. barriers to e-filing tax returns, Collins said in the news release.
Over the past year, Collins said in which include that some IRS forms “That, of course, is not an option for
the news release, refund delays on are not e-fileable, Collins said. It U.S. taxpayers, so it is critical that the
paper-filed returns have generally should also improve its hiring and IRS increase staffing in its telephone
exceeded six months, “with delays of training processes, particularly in its call centers to handle the volume of
10 months or more common for many Submission Processing and telephone calls it receives.”
taxpayers.” call centers, and enhance taxpayers’ From Paul Bonner

www.thetaxadviser.com September 2022 15