IRS Warns of Bumpy Tax Filing Season Ahead

News January 11, 2022 at 12:41 PM
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The Internal Revenue Service said Monday that the nation's tax season will start on Jan. 24, when the tax agency will begin accepting and processing 2021 tax year returns.

However, IRS Commissioner Chuck Rettig warned that "the pandemic continues to create challenges" for the tax filing season and urged taxpayers to tax steps to mitigate processing and refund delays.

"Planning for the nation's filing season process is a massive undertaking, and IRS teams have been working non-stop these past several months to prepare," Rettig said in a statement. "Filing electronically with direct deposit and avoiding a paper tax return is more important than ever this year."

Rettig urged "extra attention to those who received an Economic Impact Payment or an advance Child Tax Credit last year. People should make sure they report the correct amount on their tax return to avoid delays."

The filing deadline to submit 2021 tax returns or an extension to file and pay tax owed is April 18, instead of April 15, for most taxpayers.

"The due date is April 18, instead of April 15, because of the Emancipation Day holiday in the District of Columbia for everyone except taxpayers who live in Maine or Massachusetts," the IRS explained.

Taxpayers in Maine or Massachusetts have until April 19 to file their returns due to the Patriots' Day holiday in those states.

Taxpayers requesting an extension will have until Oct. 17 to file.

Rettig noted that IRS employees continue to work hard on "critical areas affected by the pandemic," including processing of tax returns from last year and record levels of phone calls.

"In many areas, we are unable to deliver the amount of service and enforcement that our taxpayers and tax system deserves and needs. This is frustrating for taxpayers, for IRS employees and for me," Rettig said.

Online resources should be used before calling. Last filing season, as a result of COVID-era tax changes and broader pandemic challenges, the IRS phone systems received more than 145 million calls from Jan. 1 – May 17, more than four times more calls than in an average year, the IRS said.

The IRS continues to reduce the inventory of prior-year individual tax returns that have not been fully processed.

As of Dec. 3, 2021, the IRS said it has processed nearly 169 million tax returns.

All paper and electronic individual 2020 refund returns received prior to April 2021 have been processed if the return had no errors or did not require further review, according to the agency.

Last year's average tax refund was more than $2,800. "More than 160 million individual tax returns for the 2021 tax year are expected to be filed, with the vast majority of those coming before the traditional April tax deadline," the IRS said.

Overall, the IRS states that it anticipates most taxpayers will receive their refund within 21 days of when they file electronically if they choose direct deposit and there are no issues with their tax return.

President Joe Biden's fiscal 2022 discretionary budget proposal for the IRS provides $13.2 billion, an increase of $1.2 billion, or 10.4%, above the 2021 enacted level, with $340 million devoted to enforcement.

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