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With the IRS backlog growing, millions of Americans are still waiting for their tax refunds

Millions of US taxpayers are still waiting for their returns to be processed, with an already massive backlog at the IRS growing even longer in the past year, according to a new report from a government watchdog agency.

The backlog of returns has risen to 12.4 million returns still in process as of September, an increase of 1.9 million returns from the previous year, the Government Accountability Office found. As a result, millions of Americans have experienced delays in getting their tax refunds, the agency noted.

The GAO findings come after three brutal tax filing seasons for many taxpayers, with million returns stuck in limbo as the pandemic posed a number of challenges for the IRS. The tax agency has subsequently hired thousands of new employees in hopes of being better prepared for the 2023 tax filing season, though the IRS recently warned taxpayers not to rely on receiving their refunds by a specific date when they file their returns. declarations in early 2023.

“The IRS is warning taxpayers not to rely on receiving a 2022 federal tax refund by a certain date, especially when making major purchases or paying bills,” the agency said in a November statement. “Some returns may require additional review and may take longer.”

In 2022, the median tax refund was about $3,100, more than most people’s typical paycheck. Repayment delays can put financial pressure on households that were betting on money to pay off debt, start an emergency fund or make a big purchase.

Tax season typically begins in late January, although the IRS has yet to announce the official start of the 2023 tax season. Many taxpayers plan to receive their refund within 21 days, even though last month’s IRS warning indicates that some Americans may have to wait longer.

Meanwhile, experts warn taxpayers that their refunds may be less in 2023 due to the expiration of many pandemic tax benefits, such as the expanded Child Tax Credit and federal stimulus checks.

The IRS did not immediately respond to a request for comment.

Few answered phone calls

The GAO’s findings echo a report released earlier this year by the National Taxpayer Advocate, an independent watchdog within the IRS that in June found the agency was facing a even higher backlog for the 2022 tax season than the previous year. The delays created “unprecedented financial difficulties” for taxpayers, the NTA said.

The IRS has received $80 billion in new funding through the Inflation Reduction Act, with about half of the money to be spent on improving technology and operations in an effort to avoid the kind of delays experienced in the past three years. The remaining funds will be spent on enforcement, such as hiring auditors who can go after tax fraud.

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Taxpayers struggled to get IRS employees on the phone in 2022, even though call volumes were lower than in 2021, the GAO report noted.

“However, even with fewer taxpayers calling the IRS for help, [customer service representatives] answered fewer than one in five calls during the 2022 filing season,” the GAO said.

The attrition rate among the agency’s return-processing staff stood at about 16% as of mid-June, more than double the overall IRS attrition rate, the GAO said. And about 1 in 5 new recruits leave the agency within two to three years.

“For every 10 newly hired return processing employees, the IRS needed about four additional employees to make up for the attrition,” the agency noted.

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