With the reduced federal funding budget and threadbare Covid-related IRS staffing levels some taxpayers are experiencing the frustrating result of an inaccessible IRS. Compounding the problem of unopened mail piling up at IRS offices around the country, the postal service’s slow delivery times are causing many taxpayers grief. Even when phone lines are attended to at a reasonably helpful volume and returns have a timely postmark, tax payments and responses take several months to be opened and processed. The IRS is still mailing out late filing and payment notices, assessing penalties, and proposing seizure of assets.
But help is on the way!
When all else fails and you’re not getting through to the IRS to resolve issues, the Taxpayer Advocate Service is more important and helpful this year. The TAS is an independent organization that jumps in — usually within 48 hours in our past experience — to navigate and resolve IRS issues on your behalf. However, this response time has recently stretched to 5 days, to navigate and resolve your IRS issues on your behalf.
How can you avoid timing issues?
Many clients have experienced unreasonable errors and slow communication times with the IRS this year.
One client filed his 2019 tax return on time, mailing a check for the full amount due, one week before the due date. Thinking ahead, he kept the postage receipt. Months later he received an IRS notice about late payment penalties and interest. His local post office was unable to help, as they do not guarantee delivery without the purchase of Priority Mail Express postage.
We often advise our clients to pay the extra delivery confirmation fee, so they can be sure when their tax filing or payment was received by the IRS. As the IRS does not actually open and process all mail by the due date, you may still receive a late penalty, before they get to processing their piled-up mail. If you can provide proof that the item was postmarked on time, the IRS will waive assessed penalties and interest based on the postmark date. This task is a tedious exercise in patience, sorry. Mailing responses that take several months to be read and waiting on hold for hours before getting to speak to an IRS agent are commonplace these days.
The slowdowns and understaffing due to Covid-19 and the postmaster general Louis DeJoy’s cost-cutting measures implemented mean that taxpayers will need to be better informed about what they can do to avoid mail-delay-related IRS issues. In our opinion, the less correspondence needed with the IRS, the better.
In our opinion, the less correspondence needed with the IRS, the better.
If you are not having any luck getting your issue resolved after a reasonable effort, it may be time to contact the Taxpayer Advocate Service if you have a tax issue and the lack of accessibility with the IRS is causing you financial hardship.
The best way to avoid this situation altogether is to file tax returns and pay any estimates or tax due electronically and always keep copies and records just in case the IRS still manages to lose your filing or payment!