At this time last year, the IRS had a backlog of more than five million tax returns that needed to be processed.
Thanks in part to the $80 billion Democrats got through for the IRS, the backlog this year is less than half of what it was last.
IRS Process Tax Return Papers Longer
Daniel Werfel, the new Internal Revenue Service Commissioner, responded to worries that small firms will be the focus of IRS audits.
According to a Tax Notes article, the IRS received $79 billion under the Inflation Reduction Act, and half of that sum is designated for enforcement.
Republicans are concerned that this money will be used to target small businesses.
Democrats dispute this claim, arguing that the money will be used to hire employees to level the playing field and enable the Internal Revenue Services to compete with well-funded partnerships, corporations, and high-net-worth people.
Wealthy individuals who owe money frequently file their returns extremely late in the tax season and do so on paper rather than online since it takes the IRS longer to process paper returns, which allows the money to accrue interest for longer.
The tax payments that went along with them frequently took a while to reach federal coffers following Tax Day last year, when the government was dealing with a backlog of 5.2 million returns.
Read more: IRS Expense: $10M On Weapons, Ammo And Combat Gear Since 2020 Raises Questions
Lawmakers Don’t Anticipate Debt Deadline
According to the IRS, it has processed 98.1 percent of the 134,649,000 returns it has received this year as of April 21. 2.45 million people are still waiting for action.
The administration granted residents of California and other states affected by natural disasters until October to file, which may be in part to blame.
However, California has a large number of wealthy residents, and there is a financial incentive for those who owe money to put off making payments as long as possible.
This may be another factor in why lawmakers didn’t anticipate how quickly the debt deadline would approach.
Read more: The Way The IRS Works Will Soon Be Drastically Altered
