Erin Collins, nationwide taxpayer advocate on the Taxpayer Advocate Service, speaks at a Senate Appropriations subcommittee listening to in Washington, D.C., on Could 19, 2021.
Bloomberg | Bloomberg | Getty Photographs
There is a pileup of tax id theft circumstances on the IRS — however the company is engaged on a “vary of enhancements” to hurry up service.
As of April, the company had roughly 500,000 unresolved id theft circumstances, up from 484,000 circumstances in September, Nationwide Taxpayer Advocate Erin Collins reported final week. Id theft victims have waited greater than 22 months for decision, plus a number of weeks for refunds.
Tax id theft occurs when criminals use stolen private data to file a fraudulent tax return to assert a refund. If a felony recordsdata earlier than the taxpayer, the IRS rejects and freezes the second return for investigation.
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The wait has solely grown longer over the previous a number of months. Collins reported in January that id theft victims had been ready 19 months for decision and refunds, which stemmed from Covid-19 shutdowns and pandemic aid.
These delays have brought about “important hardship” for taxpayers, particularly decrease earners, she wrote.
Almost 70% of the circumstances concerned taxpayers with an adjusted gross revenue at or under 250% of the federal poverty stage.
“It has been 4 years from the onset of the pandemic, and the IRS’ delays in serving to victims are unconscionable,” Collins wrote final week.
Whereas taxpayer service has improved by means of the 2024 season, the backlog of id theft circumstances stays “one of the crucial important ongoing service gaps,” the IRS stated in a press release.
IRS plans for ‘sooner service’
The IRS stated it is engaged on enhancements to supply “sooner service” to id theft victims, together with extra assets to work circumstances.
The company additionally plans to overview its processes and have interaction with stakeholders to “establish and stop evolving tax-related id theft threats.”
“Id theft circumstances are advanced and take time to resolve,” however elevated funding has higher positioned the company to sort out these circumstances extra shortly, the IRS stated.
The company on Tuesday warned tax professionals to guard themselves from id theft criminals who may very well be concentrating on them and their shoppers.
“Safety threats in opposition to tax professionals and their delicate taxpayer data proceed to evolve, and it’s vital to remain on prime of the most recent developments to guard their enterprise and their shoppers,” IRS Commissioner Danny Werfel stated in a press release on Tuesday.