Tax Guru – Ker$tetter Letter

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Archive for March, 2022

Are IRS computer systems impossible to fix?

Posted by taxguru on March 9, 2022

Nobody should hold their breath expecting the wizards at IRS to get their act together with their computer systems any time this century.

A client just sent me this link to Americans For Tax Reform‘s handy list of just some of the IRS’s failed attempts to modernize their computer systems.

40 Years of Failure: IRS Unable to Fix Computer System

I remember 30 plus years ago, rather than hire outside tech experts to help them, they thought they could save money by drafting employees from various IRS departments, who had zero IT skills, to design more modern systems.  I don’t recall how many millions or billions of dollars they wasted on this project, but the whole thing had to be scrapped.

It may be amusing, but it’s definitely not funny when you consider how much money they have wasted and how much aggravation, expense and hassle their incompetence has cost all of us who are on the receiving end of their screw-ups.

Posted in computers, IRS | Comments Off on Are IRS computer systems impossible to fix?

Who knows when IRS will catch up with their backlog?

Posted by taxguru on March 5, 2022

This last item from the most recent issue of The Kiplinger Tax Letter is a bit depressing for all of us hoping that IRS will get back to normal in regard to processing returns and correspondence anytime soon.

“IRS will have trouble wiping out its backlog of 2020 returns and other filings,
despite its hopes of catching up amid the temporary personnel moves it made recently.
The agency shifted 1,200 personnel from other areas to assist with the backlog.
But there are over 20 million filings by individuals and corporations from last year
to sort through. IRS is begging Congress for more funding, but even if the agency
does get the money, any relief for taxpayers won’t be immediate. It will take months
or longer to hire new workers in this tight labor market and to onboard them.”

This will be the messiest Tax Season ever, to-date; something I have actually said each of the past two years.

Update 3/7/22
I’m much less optimistic about any timely resolution to the IRS backlog after reading the following in this morning’s newsletter from NCPE Fellowship.

“IRS to Hire 10,000 Workers to Help With Tax Return Backlog

The backlog includes at least 10 million individual tax returns and 4 million business tax returns going back to last year

The IRS is taking steps to relieve the backlog of tax returns.

The agency plans to hire 10,000 new full-time workers to play a direct role in that mission, according to Politico.

There are millions of unprocessed tax returns and other mail from individual and business taxpayers, according to the union that represents most of the IRS workforce.

The hiring process is scheduled to run through Dec. 31, 2023 and was first reported by the Washington Post.

In an effort to hire 5,000 new employees has fallen flat with less than 200 workers brought on board.

The new plan “sounds like an extension of that plan and its logic,” said Chad Hooper, president of the Professional Managers Association, a group that represents non-union personnel.

While he didn’t have the details of the plan, Hooper seemed skeptical about how easily it could be fulfilled.

“It’s unclear where the IRS believes these future employees are,” Hooper said.

There is a massive accumulation of paperwork going back to last year still awaiting processing, according to the report.

The mountain of paperwork includes at least 10 million individual tax returns and 4 million business tax returns, holding up refunds and credits going back to last year.

Starting this month, the IRS shifted 1,200 workers from their current jobs to deal with the backlog.

The IRS workforce currently sits at about 80,000, according to its website.”

Posted in IRS | Comments Off on Who knows when IRS will catch up with their backlog?