IRS Warns Americans to Expect Delays in Receiving 2022 Tax Returns

February 7, 2022 Topic: 2022 Tax Season Region: United States Blog Brand: Politics Tags: 2022 Tax ReturnTaxesIRS

IRS Warns Americans to Expect Delays in Receiving 2022 Tax Returns

For weeks, the IRS and Treasury Department officials have warned that this year’s tax season will be a challenging one.

 

Amid another pandemic-hit tax season, the Internal Revenue Service (IRS) has urged taxpayers to electronically file their returns as soon as possible.

But in the mad rush to file their returns, some taxpayers might be entering incorrect or outdated information that could potentially invite IRS scrutiny, according to tax experts.

 

The IRS has noted that it closed more than 450,000 individual audits during the 2020 fiscal year—which amounts to 0.29 percent of the nearly 160 million individual income tax returns filed.

“Some people play the audit lottery, meaning they’ll do whatever they want, and know that the chances of getting caught are slim,” John Apisa, a certified public accountant (CPA) and partner at PKF O’Connor Davies LLP, told CNBC. “That’s not a good philosophy to have, though,” he continued.

Claiming Too Many Deductions

Certified financial planner David Silversmith, CPA, senior manager of PKF O’Connor Davies, also told CNBC that taxpayers should be careful when trying to claim too many credits or deductions compared to their income.

Silversmith confirmed that the IRS utilizes a specific software that gives a numeric score for each tax return. The higher the number, the higher the chance that it will trigger an audit.

According to Preeti Shah, CPA, a certified financial planner at Enlight Financial in Hamilton, New Jersey, tax returns will also likely be flagged if the numbers entered in the forms don’t match one’s reported income, which will trigger an automated notice: “For example, the IRS may receive your full-time wages on Form W-2, contract earnings on Form 1099-NEC or unemployment income on Form 1099-G,” CNBC writes. “But you can avoid underreporting by double-checking forms with a free IRS transcript before filing.”

Refund Waiting Game

For those who are expecting sizable refunds this year, don’t be surprised if a long wait is in store. For weeks, the IRS and Treasury Department officials have warned that this year’s tax season will be a challenging one, as the agency is dealing with a huge backlog of 6.7 million unprocessed individual returns and 2.6 million unprocessed amended individual returns. Those numbers are a significant reduction from a backlog of 30 million seen in May, but still far higher than the one million unprocessed returns that are more generally typical for a start to the tax season.

In addressing this issue, the IRS recently made the decision to temporarily reassign about 1,200 employees to the frontlines to help out with the backlogs.

“This is an all-hands-on-deck situation to help people as quickly as possible and reduce the stress on employees who have been and continue to face unprecedented levels of inventory to be worked,” IRS commissioner Chuck Rettig wrote in an email to employees.

Ethen Kim Lieser is a Washington state-based Science and Tech Editor who has held posts at Google, The Korea Herald, Lincoln Journal Star, AsianWeek, and Arirang TV. Follow or contact him on LinkedIn.