Jan 25, 2022

PICPA and Practitioner Community Urging Response to IRS Service Issues

Alex Fabian McMahonBy Alex Fabian, PICPA Manager of Government Relations

It’s no secret that agencies such as the IRS have been operating understaffed and underbudgeted for years. In fact, organizations such as the American Institute of Certified Public Accountants (AICPA) have been urging modernization and asking for increased funding. But add a global pandemic to the hefty pile of issues already facing the struggling IRS, and you have the perfect storm of circumstances to derail the ability to simply operate.

According to the Coalition for Taxpayer Relief on IRS Service Issues, a coalition of 11 diverse stakeholder groups representing millions from the tax practitioner community, the IRS has an unprecedented number of unprocessed returns compared to prepandemic years. At a recent press conference, the coalition reported that the IRS currently has a 6-million-return backlog and upward of 5 million pieces of unopened mail, in addition to receiving the highest call volume in history (1,500 calls per second). Consequently, the IRS is only answering 9% of calls, and only 3% of calls regarding individual income tax returns. This is preventing taxpayers from resolving some nagging, but straightforward issues.

Internal Revenue Service buildingStephen F. Mankowski, CPA, CGMA, a PICPA member, tax chair at the National Conference of CPA Practitioners (NCCPAP), and a representative on the coalition, shared some important insight on the unfortunate situation. Mankowski describes it as a “snow-ball effect.” He explains, “The problems are highlighted by the fact that the IRS is sending out notices to taxpayers that did pay and, in fact, their payment has cleared. There are so many cases where people have responded but are getting automated letters putting actual levies and liens against people, and if they try to call, they can never get through. The IRS is so far behind that they can’t get to all of the issues.”

The PICPA, which is primarily a state-level organization, has joined with our federal counterparts at the AICPA in an attempt to reconcile the issues at the IRS, which Mankowski refers to as “Almost at the point of no return.” The PICPA sent a request to members of Pennsylvania’s congressional delegation to sign on to a letter urging Secretary of Treasury Janet Yellen and IRS Commissioner Charles P. Rettig to address the unprecedented challenges facing the agency. The letter requests that the IRS consider the following measures to bring immediate relief to taxpayers and reduce the backlog during this tax filing season:

  • Halt automated collections from now until at least 90 days after April 18, 2022.
  • Delay the collection process for filers until any active and pending penalty abatement requests have been processed.
  • Streamline the reasonable cause penalty abatement process for taxpayers impacted by the COVID-19 pandemic without the need for written correspondence.
  • Provide targeted tax penalty relief for taxpayers who paid at least 70% of the tax due for the 2020 and 2021 tax year.
  • Expedite processing of amended returns and provide Taxpayer Advocate Service and congressional caseworkers with timely responses.

Several members of the Pennsylvania congressional delegation have already signed on to the letter, demonstrating that legislative leaders are hearing our concerns and sharing in our frustration.

Additionally, the PICPA is in frequent communication with our IRS stakeholder liaison, Richard Furlong. We have a Q&A Session Scheduled with him on Feb. 3. Members can register now. 

The PICPA is proud to share in the recommendations made on behalf of coalition leaders and millions of taxpayers. Please know that we intend to continue fighting for a remedy. As Mankowski stated when describing the enormity of these issues, “We can’t fix the IRS, but we need to mitigate the damage; and one of the best ways to do that is to grant the IRS the time they need to get caught up.”

Sign up for weekly professional and technical updates from PICPA's blogs, podcasts, and discussion board topics by completing this form.

Leave a comment

Follow @PaCPAs on Twitter
PICPA Staff Contributors
Statements of fact and opinion are the authors’ responsibility alone and do not imply an opinion on the part of PICPA officers or members. The information contained in herein does not constitute accounting, legal, or professional advice. For professional advice, please engage or consult a qualified professional.