The IRS is announcing plans to hire 10,000 new workers to help reduce a massive backlog that the Biden administration says will make this tax season the most ch...
WASHINGTON (AP) — The IRS said Thursday it plans to hire 10,000 new workers to help reduce a massive backlog that the government says will make this tax season the most challenging in history.
The agency released a plan to work down the tens of millions of filings that includes speeding up the traditionally slow hiring process, relying more on automated processes and bringing on more contract workers to help with mailroom and paper processing.
Getting it done will be the big challenge, tax experts say.
The agency faces a backlog of around 20 million pieces of correspondence, which is more than 15 times as large as in a normal filing season, according to the agency. And the IRS workforce is the same size it was in 1970, though the U.S. population has grown exponentially and the U.S. tax code has become increasingly complicated.
Additionally, the need to administer pandemic-related programs has imposed an entirely new workload on the agency.
White House officials have said the agency is not equipped to serve taxpayers even in non-pandemic years. A senior administration official, speaking on condition of anonymity Thursday to preview the new IRS plan, said processing returns will continue to be a massive challenge so long as the agency operates on 1960s infrastructure.
The IRS’ latest plan to combat the current backlog includes creating a 700-person surge team to process new returns, adding 2,000 contractors to respond to taxpayer questions about stimulus and child tax credit payments and developing new automated voice and chat bots to answer taxpayer questions.
The plan also calls for several upcoming hiring fairs in Austin, Texas; Kansas City, Missouri; and Ogden, Utah, where the IRS will be able to use “direct-hire authority” to allow new hires to begin work within 30 to 45 days of their job offer.
There is no plan to extend the current April 18 filing deadline, the senior official said. Lawmakers have asked IRS Commissioner Chuck Rettig for that deadline to be extended, citing taxpayers’ economic challenges due to the pandemic.
The new IRS plan comes as lawmakers have made persistent calls for additional federal funding for the agency.
Congress’ mammoth $1.5 trillion omnibus package, released early Wednesday, would provide $14.3 billion to the Treasury Department, including $12.6 billion devoted to the IRS. That would be the largest funding increase for the tax agency since 2001.
However, Republicans have questioned the need for additional funding. Florida Sen. Rick Scott’s “ 11 Point Plan to Rescue America,” unveiled in February, proposes a 50% cut in funding and workforce at the IRS.
The White House and Senate Minority Leader Mitch McConnell have roundly rejected Scott’s idea.
Caroline Bruckner, a tax professor at the American University Kogod School of Business, said the agency is “at a competitive disadvantage” for finding new staff based on its reputation for employees being wholly overworked. She said she based this on her own survey of tax students she teaches.
Bruckner said, “It’s absurd we have put so much work on the IRS” without giving it the necessary resources to help Americans in the way that is expected.
Bruckner says along with increased funding, the IRS also “really has to change its narrative and the way it talks about its mission to one of service and being one of the most important anti-poverty systems that we have in the U.S.”
During the 2020 budget year, the IRS processed more than 240 million tax returns and issued roughly $736 billion in refunds, including $268 billion in stimulus payments, according to the latest IRS data. In that same time frame, 59.5 million people called or visited an IRS office.
Another barrier to hiring is the pay structure of many IRS positions.
In February, National Taxpayer Advocate Erin Collins, who serves as an IRS ombudsman, told a Senate Finance subcommittee that the current base pay for some IRS employees is $24,749.
“In this economy, it is not surprising that the IRS is having difficulty finding enough suitable job applicants,” Collins said.
Lisa Perkins, director of the Tax Clinic at the University of Connecticut School of Law, says the agency should bring in as many workers as possible to reduce the backlog, as it hurts low-income individuals who need their tax refunds quickly.
“This rush to hire 10,000 workers, it’s really not going to be effective until the next filing season,” she said, “but it is necessary.”
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