IRS still processing millions of returns

 IRS still coping with millions of unprocessed tax returns

By  Michael CohnNovember 10, 2022, 2:52 p.m. EST4 Min Read

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The Internal Revenue Service had 4.4 million unprocessed individual returns received this year as of Oct. 28, including tax year 2021 returns and late-filed returns from the prior year, as IRS funding has become more of an issue during election season.

The IRS reported in the latest update this week on the status of its mission-critical operations during COVID-19 that of those 4.4 million unprocessed returns, 1.9 million require error correction or other special handling, while 2.5 million are paper returns still waiting to be reviewed and processed. The work typically doesn't require the IRS to correspond with taxpayers, but does require special handling by an IRS employee so, in those cases, it's taking the IRS more than 21 days to issue any related tax refund.

Internal Revenue Service headquarters in Washington, D.C.

Samuel Corum/Bloomberg

Some of the problems holding up tax returns come from amended returns that arrived at the IRS and problems with tax returns indicating pandemic-related benefits such as expanded unemployment insurance and employee retention credits, for which the rules and thresholds changed, and that were exploited in some cases by criminals and fraudsters. The IRS is also still trying to hire thousands more employees to fill the ranks as workers retire.