INSIGHTi

Challenges for Taxpayers Filing in 2022
March 10, 2022
In her latest report to Congress, National Taxpayer Advocate (NTA) Erin Collins described 2021 as the
“most challenging year taxpayers and tax professionals have ever experienced.” Central to those
challenges were large backlogs of unprocessed tax returns and unanswered taxpayer correspondence,
mostly from the 2020 tax year. The backlogs meant that millions of taxpayers encountered delays in 2021
in having their returns processed, receiving refunds, and corresponding with the IRS about tax issues.
Some are concerned that similar challenges could arise in 2022.
This Insight discusses key challenges many taxpayers may face during 2022 and the steps the Internal
Revenue Service (IRS) has taken and plans to take to lessen such challenges now and in the future.
Possible 2022 Taxpayer Challenges
Early in the 2022 filing season, many taxpayers have concerns about two issues in particular:
 the availability of helpful and timely IRS customer telephone service; and
 possible delays in having their returns processed, receiving refunds, and resolving tax
issues through correspondence.
IRS’s Telephone Assistance
One way the IRS helps taxpayers fulfill their tax obligations is through toll-free telephone assistance
during a filing season. IRS’s customer service representatives (CSRs) help taxpayers understand current
tax law, resolve tax account problems, and respond to IRS compliance notices.
IRS’s ability to provide timely phone assistance has long been a source of concern for many taxpayers
and tax practitioners. From FY2015 to FY2020, the percentage of taxpayer calls to customer service lines
that got through to a CSR averaged 60.5%. During FY2021, this level of service dropped to an
unprecedented low: According to the NTA, 11% of callers to IRS’s customer service lines were able to
speak with a CSR. Unusually high call volume and a shortage of CSRs explained much of this low level
of service.
Millions of taxpayers may encounter similar difficulties in obtaining timely phone assistance from the
IRS in 2022. Numerous taxpayers may seek information on the status of their returns and refunds from
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2021, as they did in 2020. Many may also need help getting the third round of economic stimulus
payments they should have received in 2021 but did not. Then there are those who received advance child
tax credit payments in 2021; many may need help reconciling the amount they received with the amount
they can claim on their tax returns. There is concern that CSR staffing will not be large enough to achieve
a relatively high level of phone service.
IRS Processing, Refund, and Correspondence Delays
A major source of frustration and confusion for many taxpayers in 2021 was lengthy delays in getting
their returns processed, receiving refunds, and corresponding with the IRS about a variety of tax matters.
Such delays may continue for many taxpayers in 2022.
The IRS entered the current filing season with an exceptionally large backlog of unprocessed 2020 tax
year returns (mostly paper) and unanswered taxpayer correspondence. According to the NTA, as of
February 5, 2022, the number of individual and business tax returns and taxpayer correspondence
requiring manual processing totaled 23.5 million. The NTA has stated that in an average filing season, the
return backlog is below 1 million.
The current backlog is partly a product of a backlog of 11.7 million unprocessed 2019 (mostly paper)
individual and business returns (including amended returns) and about 3 million unopened items of
taxpayer correspondence at the end of 2020. Working through this inventory led to delays in the
processing of 2020 (mostly paper) returns and taxpayer correspondence.
There are several reasons for this backlog. One was the slowdown in IRS’s operations in 2020 and 2021
caused by the COVID-19 pandemic. Additionally, the IRS took on added work to deliver three rounds of
economic stimulus payments in 2020 and 2021 and to implement an advance enhanced child tax credit.
On top of these developments were the significant cuts in IRS staffing and inflation-adjusted funding
since FY2010.
The IRS says that it is processing 2021 returns while it works through its backlog of prior-year returns.
Still, the agency’s workforce and technological constraints make it possible that 2022 may end with
another large backlog of unprocessed returns and unopened taxpayer correspondence. To minimize the
risk of processing and refund delays, the IRS recommends that taxpayers electronically file their 2021
returns and provide direct deposit information for refunds or payment of additional tax.
Steps the IRS Has Taken to Reduce Return and
Correspondence Backlogs
The IRS has taken several steps intended to accelerate the reduction of current tax return and
correspondence backlogs and prevent future large backlogs.
To speed up the elimination of those backlogs, the IRS has reassigned 1,200 employees from other
divisions with experience in accounts management to help process returns, amended returns, and taxpayer
correspondence from 2021. They make up an “inventory surge team” that could operate through the end
of September 2022. Other such teams may be formed. Employees assigned to work on inventory
reduction are subject to mandatory overtime.
The IRS has also taken several measures that might reduce the probability of future large return and
correspondence backlogs. It recently announced the cancellation of a planned closure of the IRS
processing center in Austin, TX, in 2024. The closure was part of a consolidation plan the IRS adopted in
2016. This decision retains IRS’s current processing capacity.

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Another measure is for the IRS to hire 10,000 employees in FY2022 and FY2023, through an expedited
process. The plan is to pay for the new hires with funds in IRS’s current budget. The new hires are to fill
80 different positions, ranging from entry-level clerical workers to software engineers and tax attorneys.
IRS management hopes such a hiring surge will trigger a stronger effort from current employees to reduce
the return and correspondence backlogs. Owing to the months of training required for many of these
positions and the reported difficulty the IRS has recently had hiring new employees for accounts
management, there may not be enough time for any new hires to greatly lower the probability of millions
of taxpayers encountering lengthy delays in 2022.


Author Information

Gary Guenther

Analyst in Public Finance




Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff
to congressional committees and Members of Congress. It operates solely at the behest of and under the direction of
Congress. Information in a CRS Report should not be relied upon for purposes other than public understanding of
information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role.
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