he following information is presented in order to illustrate the lack of responsiveness by the IRS in processing refunds, addressing correspondence, and even processing tax returns. The data relayed to you in this email was taken from Annual Report to Congress by the National Taxpayer Advocate, which is independent of the IRS and partially tasked with reporting to Congress regarding problems encountered by taxpayers when interfacing with the IRS.
During 2021, millions of taxpayers waited for an extraordinary time period for their returns to be processed, refunds to be issued (many have yet to be issued), and correspondence to be addressed. Often the correspondence was related to resolving issues with tax returns, delaying refunds and tax return processing for many taxpayers even into 2022. These IRS problems often have negative effects for taxpayers, many of whom see the refunds as critical to their financial wellbeing. Other taxpayers need their tax returns to be processed in order to obtain a mortgage, refinance a mortgage, or obtain student loans.
As of mid-December 2021, the IRS was faced with the following backlog going into the new tax filing season which begins in January 2022, Therefore, the unprecedented delays will most likely continue.
- 6.2 million unprocessed individual returns (Form 1040);
- 2.8 million unprocessed business returns (Form 941);
- 2.4 million unprocessed amended individual returns (Forms 1040-X);
- 427,000 unprocessed amended business return (Form 941-X); and
- Approximately 4.75 million pieces of general taxpayer correspondence.
Regarding unpaid refunds and unprocessed amended tax returns, the IRS has implemented an online tool called “Where’s My Refund?” and “Where’s My Amended Return?” for individual taxpayers. These do not provide specific information regarding the delay in paying the refund or processing the amended tax return. Therefore, these tools are of limited utility and provide no help in resolving issues regarding delayed refunds or unprocessed amended tax returns.
The National Taxpayer Advocate concludes that these issues have yet to be resolved. That means taxpayers will continue to encounter many of these same problems during 2022.