IRS Backed Up Causing Incorrect Tax Notices

Like many businesses, the IRS had to alter their operations during COVID-19. Ultimately this has lead to them being severely backed up affecting the time it will take to process mail in tax returns as well as billing notices.

IRS Backed Up
Due to COVID-19 the IRS is backed up and has roughly 11 million pieces of unopened mail. This is causing billing notices to be inaccurate and increased wait time for any correspondence from the IRS.

Billing Notices

In June the IRS began to mail 20 million backlogged letters and  notices to taxpayers with past due payments or response dates.  In efforts to keep costs low they did not reprint the notices with the correct due dates, but instead included an insert with the corrected due date, which should be on the last page of the insert. 

Not only were due dates wonky, but the billing balances may be wrong as well. The IRS is so backed up they have 11 million pieces of unopened mail. (Imagine going through all of that!?)

If you receive a notice from the IRS saying you owe more taxes, just hold tight it could very well be an inaccurate notice. Your payment is probably sitting in the 11 million pieces of unopened mail they have to process.

Your next concern may be about late penalties and interest charges. Don’t worry about this, the IRS will post payments as the date they received the mail, rather than the date they processed the mail (Although, who knows how long it will take to process).

Mail In Tax Returns

Due to COVID-19 the IRS continues to experience long processing delays. Paper tax returns have always taken a bit longer than e-filing, but sometimes it is unavoidable. When possible we always recommend e-filing. 

It could honestly take months for mail in tax returns to be processed. 

Other IRS Operation Updates

  1. The IRS is waiving bad check penalties for dishonored checks the agency received between March 1st and July 15th due to delays in IRS processing.
  2. Taxpayers who mail correspondence to the IRS “should expect to wait longer than usual for a response.” You may be asking what are normal response times? Well, lets just say don’t hold your breath.
  3. Installment agreements continue to be available online for clients that need to make payment arrangements.
  4. Call-waiting continues to be lengthy. Get Transcript is available online and may help.
  5. CAF is backlogged. IRS says that we should expect a POA to take 15 business days to process.
  6. All in-person Taxpayer Advocate Services (TAS) offices are closed. Expect delays and interruptions in working cases due to limited IRS High call volume to TAS offices has resulted in delays in their response time. Visit the TAS webpage to locate your local office phone number.
  7. Appeals will not conduct any in-person conferences at least through August 31st, 2020. Appeals Hearings will be by telephone or by WebEx video conference technology. 

If you have any tax questions or need assistance book a call with us HERE

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