6/29/2023 0 Comments Government watch dogsThere was also a third Recovery Rebate Credit. As part of the American Rescue Plan Act of 2021 (ARPA), the Child and Dependent Care Credit, Child Tax Credit, Earned Income Tax Credit, and Premium Tax Credit were modified for the 2021 tax year. Changes In The LawĬomplicating matters, there were a lot of changes in tax laws for 2021. Thankfully, by October 1, 2022, inventory levels were reduced to more than 5 million. The IRS reported that more than 8 million cases remained in the Accounts Management inventory, with more than 7 million remaining as of May 7, 2022. Taxpayers were not having their cases addressed. Last fall, Treasury announced that the IRS would automate the scanning of millions of individual paper tax returns for filing season 2023-the one happening now-to speed up the issuance of refunds. Once validated, 95,724 (71%) of the scanned returns were processed, whereas 38,868 tax returns involved potential taxpayer errors requiring review in the Error Resolution function. That takes time: as of August 20, 2022, the IRS reports that 134,592 tax returns were scanned and required 12,187 hours to validate at an overall rate of approximately 11 documents per hour. The goal was to scan a paper tax return prepared using software to convert it to a format suitable for electronic processing.īut before a scanned return can be processed, the scanned image must be validated. To address some of these issues, the IRS collaborated with a third-party vendor to develop and test a scanning and digitalization solution to address the backlog of the tax year 2020 tax returns. It's no secret that technology at IRS is lagging.
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