According to a report by the Treasury Inspector General for Tax Administration, the Covid pandemic caused a backlog of almost 8 million paper-filed business tax returns at the end of 2020. The IRS continues to have difficulty hiring enough staff to continue processing tax-year 2020 returns — the agency had only met 63% of its recruitment goal for processing operations as of July, NBC reports.

In today’s AICPA Town Hall — a special edition focused on tax issues — Melanie Lauridsen, Senior Manager of Tax Policy & Advocacy, drove home the point of how the inability of the IRS to fully process this backlog, answer the phones, or handle incoming snail mail in a timely manner is affecting taxpayers and their preparers. A case in point was the answer-rate of the phone lines — they are overwhelmed with substantially more calls than in the past, and only able to answer 2-8% of calls.

This has motivated the AICPA to introduce penalty relief recommendations to Congressional leaders. Underpayment and late penalty relief for 2020, as well as holding off on compliance adjustments and issuing account holds until all snail mail is processed and payments by check can be applied to accounts, would significantly reduce the number of calls to the IRS to resolve these issues (many of which are only a matter of correspondence crossing in the mail). By reducing the number of calls, we would be helping the IRS increase the rate at which they can answer existing calls.

In the meantime, you can check on the IRS status of operations in specific areas via this link — IRS Operations During COVID-19: Mission-critical functions continue | Internal Revenue Service — if you need to contact the IRS, try right at 7 am or shortly before 7 pm; and if after repeated attempts you have no luck, try contacting your local Taxpayer Advocate:
Local Taxpayer Advocate | Internal Revenue Service (irs.gov)

If you’re having challenges and want to help raise awareness to the situation at the IRS and promote penalty relief as one part of the solution, you can go to social media and:
• Share stories of pandemic-related hardships
• Tag members of Congress, media and gov’t officials on social media posts
• Include hashtag #COVIDPenaltyRelief in all social media posts
• Tag AICPA on your posts:
– Twitter: @AICPA
– Facebook: @AICPA
– LinkedIn: @AICPA
– Instagram: @theaicpa
• Find your rep: https://www.house.gov/representatives/find-your-representative
Members of Congress Twitter handles: https://twitter.com/i/lists/34179516/members
IRS Social Media: @IRS
• Share story or template post:
The pandemic has caused a lot of personal and economic suffering in our country. Taxpayers need relief from tax penalties now – we ask the @IRS to grant penalty relief. #COVIDPenaltyRelief @AICPA @[mediaoutlet] @[member of Congress

Thank you in advance for helping raise awareness to a situation that is causing serious hardship for many thousands of Americans.

---