IRS Still Stumbles on Processing Paper, Watchdog Says (1)

Paper processing remains a sore spot for the IRS as it uses the 2022 tax-and-climate law funds to catch up after decades of financial strain, the National Taxpayer Advocate Erin Collins said in an annual report to Congress Wednesday.

Though the IRS has eliminated its backlog of paper-filed 1040 forms, it still has outstanding amended tax returns and correspondence that can cause delays in issuing refunds, Collins said. Almost 70% of pending correspondence cases took longer than normal in 2023, the highest level in recent years, according to the report.

Collins attributed the setbacks to Treasury’s decision to concentrate on ...