IRS Is an Absolute Mess

Spring of 2021 may be the day the amassing woes of the IRS hit critical mass. Processing federal tax returns in 2021 is going to be slower than normal; we don’t know how much slower, because no one seems to know.

The IRS cites concern for those filing returns during the difficulties posed by Covid as the reason they are pushing the 2020 filing deadline back from April 15 to May 17 this year, though the sympathy may be better directed at the federal taxing authority.

The IRS’ complaints about a dwindling workforce, inadequate budgets and antiquated computer systems have fallen on deaf ears for years, but those systemic problems are meeting face to face with a year of pandemic delays, while 85% of households are being mailed stimulus checks, while more households are submitting their 2020 tax returns, though the rules just changed with the newly passed $1.7 trillion stimulus package and many of those returns will have to be modified and resubmitted.

And did we mention that they still have 24 million returns from last year they haven’t processed yet? When Covid lockdowns went into effect and the IRS sent their workforce home, it was discovered almost no one was able to work from home because the IRS computer systems are so outdated. Not many smartphones are compatible with computers programmed on COBAL.

What all this means is that there’s no telling when you’ll get a refund check.

CPA’s across the country are racing to incorporate the new rules of the American Rescue Plan into what they had already prepared to help clients navigate the labyrinth of tax loopholes. Companies like H&R Block and Turbo Tax are having to update their updated updates to answer questions about when stimulus checks will arrive, child credits and how unemployment income will be taxed.

If everything about 2021 taxes hasn’t thoroughly confused you, keep in mind that the filing deadline in Texas, as opposed to most of the country, is June 15. The extension was awarded as part of Governor Abbott’s disaster declaration in the February freeze.

photo: Getty Images

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