Where’s Your Refund? Veteran Taxpayer Advocate Offers Tips On Dealing With The Mess At The IRS

The Internal Revenue Service entered this tax filing season severely backlogged and shorthanded—the result of decades of underfunding exacerbated by Covid-19 related strains. As of early last month, the agency had 23.5 million tax returns and pieces of correspondenceawaiting manual processing, including some paper returns filed as far back as April of 2021. Last filing season, 160 million of 195 million taxpayer calls to the IRS didn’t even get through; only 11 million callers got to talk with an IRS employee while another 24 million callers got automated answers.

Nina E. Olson, a tax lawyer and the founder and executive director of the Center for Taxpayer Rights, describes the current problems at the IRS as the worst she’s ever seen. And she’s seen a lot. From 2001 to 2019, she served as the IRS’ National Taxpayer Advocate—an independent voice within the agency charged with helping individual taxpayers and making recommendations to Congress for change. Before that, she spent years representing clients and running a clinic for low-income taxpayers. The only thing that comes close to the current mess, Olson says, was 1985, when workers at tax return processing centers were struggling with a then new computer system (which is still in use) and fell so far behind that a few famously resorted to hiding returns in closets and in trash bags. “That was the worst to date. And I think this filing season and the last filing season have really shown that it's just far worse (now),’’ she said last week during a conversation for Forbes subscribers.

The good news is that the IRS’ problems won’t affect the majority of taxpayers—they can still file their 2021 1040s electronically and see their expected tax refunds appear in their bank accounts within a few weeks. (As of March 4th, the IRS had issued 38 million tax refundsaveraging $3,401 each.)