In conformance with CDC guidelines, the IRS employees have been working remotely and/or have been limited in time spent in the office due to social distancing. This has generated a HUGE backlog of correspondence, paper-filed returns, tax payment deposits and matching issues for tax payments.
February: The IRS has 6.7 million returns in the pipeline. They are currently working on returns received during the summer of 2020. Do not void your tax payment; that action will lead to more correspondence. For detailed information, see this recent IRS Notice.
March: Dependent on your location or place of business, your Federal filings have been extended until May 17, 2021 or June 15, 2021. State filings are not uniform in following the changes.
April: Waiting for manual review or processing at the IRS:
- Over 8 million individual returns are in review related to errors in Recovery Rebate Credits,
- Additional 5.3 million of individual returns (2019 and 2020),
- Returns with processing errors or identity theft exceed 4.7 million, and
- 11 million business returns and correspondence.
Additional Resources:
IRS Blog
Forbes article on delays
In addition to processing returns, the IRS software has been mailing notices with past due payment and response dates. You cannot ignore the notices though they may not be correct. The IRS will work through the responses in order received. There will be delays due to the volume; follow-up correspondence or calls are not suggested.
As a CPA firm, we have seen a dramatic increase in notices; most of them are incorrect. We will respond on your behalf and then the waiting game begins. It is frustrating for you and us-we did our jobs. The IRS has been delayed with their portion of the process. One more COVID-19 headache we did not anticipate in planning the 2020 and 2021 filing seasons (for 2019 and 2020 returns). We will update this article as more information is available.
HoganTaylor Tax Service
In addition to general tax compliance and planning, HoganTaylor’s Tax professionals serve as business advisors to their clients. They offer expertise to assist individuals and organizations with planning, strategy, and a number of other senior management needs.
If you have any questions about the content of this publication, or if you would like to visit with a HoganTaylor Tax professional, please contact Tax Partner Denise Felber via email at dfelber@hogantaylor.com or by phone at 918.745.2333.
INFORMATIONAL PURPOSE ONLY. This content is for informational purposes only. This content does not constitute professional advice and should not be relied upon by you or any third party, including to operate or promote your business, secure financing or capital in any form, obtain any regulatory or governmental approvals, or otherwise be used in connection with procuring services or other benefits from any entity. Before making any decision or taking any action, you should consult with professional advisors.
