In her 2023 Annual Report to Congress, National Taxpayer Advocate Erin Collins, writes that “We have begun to see the light at the end of the tunnel.” Indeed, earlier this month the IRS announced that it had completed the automatic adjustments of 2020 tax returns related to the exclusion of unemployment income that was passed by Congress in the middle of the 2021 filing season. Progress is also being made on the backlog of paper filed returns and correspondence in the IRS inventory. And, despite House leadership in Congress attempting to repeal some of the IRS funding provided by the Inflation Reduction Act, additional phone service agents and in-person support staff have been hired and phone staff that were assigned to help with the paper backlog are returning to their regular assignments.
It seems that things are improving at the IRS, at least with respect to backlogged paperwork and taxpayer service. Anecdotal reports on social media are even beginning to indicate that service may be improving for tax professionals. Collins notes in her report “Because tax professionals prepare the majority of tax returns and often call with complex account-specific questions, the IRS has established a Practitioner Priority Service (PPS) telephone line to handle their calls. In FY 2022, IRS employees answered only 16% of PPS calls (fewer than one out of six), and the average hold time for those who got through was 25 minutes.” She notes that this poor service places tax professionals in the “difficult position” of having to bill clients for time spent trying to reach the IRS by phone or to write off that time (lose money). It also should be noted that the PPS is what representatives working at Low Income Tax Clinics (LITCs) across the country use to resolve IRS matters for their clients and that poor service on the PPS affects not only taxpayers who can afford to pay a representative, but many who can’t. Poor phone service on the PPS drains already scarce resources at the LITCs, which often rely on pro bono volunteer attorneys, EAs, and CPAS, in addition to paid staff to help provide services to low-income clients.
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