The IRS processed more tax returns quickly this year, and phone service improved, says a congressional report released Wednesday.
However, there is a significant need for the agency to update its information technology services and increase the number of staff members dedicated to handling phone inquiries.
Significant Improvement in IRS Performance
Nonetheless, this represents a substantial improvement compared to previous years characterized by backlogs and inadequate funding.
National Taxpayer Advocate Erin M. Collins’s recent update reveals that the IRS has effectively decreased its backlog of unprocessed paper tax returns by 80%. The number of unprocessed returns dropped significantly from 13.3 million at the conclusion of the 2022 filing season to 2.6 million by the conclusion of the 2023 filing season.
Furthermore, the Internal Revenue Service (IRS) has achieved a significant improvement in its phone call response rate, now successfully addressing 35% of incoming calls. This represents a noteworthy increase compared to the previous rate of 11%. Collins emphasized the remarkable contrast between the 2022 filing season and the 2023 filing season, likening it to a return to pre-pandemic levels.
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Biden Administration’s Assurance
Last year, President Joe Biden’s environment, healthcare, and taxation legislation gave the Internal Revenue Service $80 billion for tax collection. Due to retirements, attrition, and low wages that failed to keep up with inflation, the agency used these monies to grow its workforce, which had shrunk to 1970s levels.
Once the president and Congress agreed to rescind over $20 billion to temporarily suspend the nation’s $31.4 trillion debt ceiling, the agency’s budget was reduced.
The Biden administration has pledged minimal impact on the agency’s operations in the coming years due to these spending cuts.
Collins’ study noted the IRS’s struggle to meet Treasury Department customer service goals with its current personnel. Identity theft cases now take 15 months to conclude.
The Internal Revenue Service transferred identity theft workers to account management and phone queries during the pandemic. The Internal Revenue Service unwittingly harms identity theft victims due to its diminished workforce.
Their plans include investing in new technology, hiring additional customer service professionals, and expanding high-net-worth taxpayer auditing.
Collins’ assessment advised the IRS to modernize obsolete technologies to improve taxpayer experiences.
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