Tax Filing 2022: What to Expect

The IRS recently announced that the 2022 tax filing season will begin on Monday, January 24th, 17 days earlier than 2021. Many tax professionals, including every member of Weiss’s tax team, have described last year’s filing season as one of the most challenging ever – and 2022 is looking is looking very much like a repeat of 2021.

Recently, the IRS’s National Taxpayer Advocate Erin M. Collins describes some of those challenges in her annual report to Congress on the 2021 filing season. According to the report, tens of millions of American taxpayers saw delays in both the processing of their returns and the disbursement of tax refunds for the 77% of those taxpayers who filed for a refund in 2021.

Collins says one of the most significant factors contributing to the delay is the severe labor shortage the IRS is currently facing. The report states that since 2010, the IRS workforce has shrunk by 17% while the workload has increased 19%. The shortages appear to stem mainly from federal budget cuts that have been further exacerbated by the pandemic. With no staffing relief in sight, 2022 is shaping up to likely be a repeat of 2021.

Another challenge is the ongoing COVID-19 pandemic and contending with the many complexities of related tax relief measures. Collins’ annual report indicates the IRS issued 478 million Economic Impact Payments (EIPs) totaling $812 billion as well as Advance Child Tax Credit (AdvCTC) payments to over 36 million families totaling $93 billion. The number of discrepancy claims has dramatically increased as well, the most typical of which involve Recovery Rebate Credit (RRC) claimsl which are filed by taxpayers who did not receive their EIPs in 2021. Discrepancies need to be manually reviewed by the IRS, causing extensive delays in the tax filing process.

All told, the report concludes, COVID-related tax changes coupled with processing delays caused 2021 customer service call volume to triple from 2020. The IRS fielded a record 282 million phone calls in 2021, with only 11% answered by customer service representatives.

“There’s no question that last year’s tax season was a challenging one for all involved, but I’m extremely proud of how our team met that challenge,” says Weiss Managing Partner Dan Fortman. “While we’re expecting more of the same for 2022, the good news is we’re ready.” He notes the firm has implemented a variety of new tools and systems to streamline tax workflow, and has advised clients to get their tax information organized and in work as soon as possible. “Our mantra this year is ‘the earlier, the better’,” he says.

To speed up refunds, the IRS urges all taxpayers to file their returns electronically with all direct deposit information, and to avoid paper submissions. The due date to file personal tax returns in 2021 or request an extension is Monday, April 18th. The due date to file for taxpayers who request an extension is Monday, October 17th.