IRS Operations During COVID-19: Mission-Critical Functions Continue

We are opening mail within normal time frames, and we’ve processed all paper and electronic individual returns in the order received if they were received prior to October 2022 and the return had no errors or did not require further review.

As of December 23, 2022, we had 1.91 million unprocessed individual returns received this year. These include tax year 2021 returns and late filed prior year returns. Of these, 1.49 million returns require error correction or other special handling, and 414,000 are paper returns waiting to be reviewed and processed. This work does not typically require us to correspond with taxpayers, but it does require special handling by an IRS employee so, in these instances, it is taking the IRS more than 21 days to issue any related refund. 

How long you may have to wait: We continue to process tax returns that need to be manually reviewed due to errors. For returns received in the current year, we process individual tax returns for which refunds are due first. Tax returns reflecting tax owed are processed last, but if a payment is mailed with the tax return, the payment is separated upon receipt and deposited to ensure the taxpayer account is credited for the payment. 

As the return is processed, whether it was filed electronically or on paper, it may be delayed because it has a mistake, is missing information, or there is suspected identity theft or fraud. If we can fix it without contacting you, we will. If we need more information or need you to verify you sent the tax return, we will send you a letter. The resolution of these issues could take more than 120 days depending on how quickly and accurately you respond, and how quickly we can complete the processing of your return. Taxpayers are encouraged to check Tax Season Refund Frequently Asked Questions.

What you should do: In most instances, no further action is needed. Whether you filed electronically or by paper, we will contact you by mail if we need more information or if we made a change to your return. If you filed electronically and received an acknowledgement, you do not need to take any further action other than promptly responding to any requests for information. If you are due a refund, filed on paper more than six months ago, and Where’s My Refund? does not indicate we received your return, you should resubmit your tax return, electronically if possible.

Make sure it includes an original signature, and include all documents submitted with the original return. Otherwise, please do not file your tax return again.  Check Where’s My Refund?, or view your account for possible updates.

Status of Processing Form 1040-X, Amended Individual Tax Return: Status of Processing Form 1040-X, Amended Individual Tax Return: As of December 24, 2022, we had 454,000 unprocessed Forms 1040-X. We are processing these returns in the order received and the current timeframe can be more than 20 weeks. Please don't file the same return more than once. Taxpayers should continue to check Where's My Amended Return? for the most up to date processing status available.

Status of the 2020 Unemployment Compensation Exclusion Corrections:  The IRS has completed systemic adjustments of these accounts. The IRS corrected 14 million returns and issued 12 million refunds totaling $14.8 billion. Some taxpayers received refunds, while others had the overpayment applied to taxes due or other debts. The IRS mailed a letter to affected taxpayers to inform them of the corrections, generally within 30 days from when the corrections were completed. See the 2020 Unemployment Compensation Exclusion FAQs for more information, including details on whether filing an amended return is needed.

Status of Processing Form 941, Employer’s Quarterly Federal Tax Return: As of January 5, 2023, we had 512,000 unprocessed Forms 941.  If you filed electronically and received an acknowledgement, you do not need to take any further action other than promptly responding to any requests for information. These tax returns are processed in the order received. Please don’t file a second tax return.

As of January 4, 2023, our total inventory of unprocessed Forms 941-X was approximately 395,000, some of which cannot be processed until the related 941s are processed.  While not all of these returns involve a COVID credit, the inventory is being worked at two sites (Cincinnati and Ogden) that have trained staff to work possible COVID credits.

How long you may have to wait: While we are opening mail within our normal timeframe, processing these responses is taking longer than usual due to resource restrictions. The exact timeframe varies depending on the type of issue. 

What you should do: Once you’ve answered the letter or notice, you don’t need to answer it again. We’re working through all taxpayer replies in the order we received them and will consider your reply as of the date it was received, not the date we reviewed it. 

The IRS is currently processing Form W-7s that were received in September 2022. We are processing requests in the order they were received. You will be notified once your ITIN is assigned or if additional information is needed. Original identification documents that are submitted with the Form W-7 will be returned to you at the mailing address of record as quickly as possible. The associated tax return will then be submitted for processing.

Other than responding to any requests for information promptly, there is no action you should take. Do not file a second Form W-7 or tax return. Eligible taxpayers who need to obtain or renew an ITIN may submit Form W-7 and the related tax return and documentation now if they have not previously filed. Please refer to the Instructions for Form W-7 for eligibility requirements.

You will receive notification that your case has been resolved. This is generally within 120 days, but due to extenuating circumstances caused by the pandemic our identity theft inventories have increased and on average it is taking about 360 days to resolve identity theft cases. The IRS is committed to resolving identity theft cases as quickly as possible and we are taking steps to reduce this timeframe to 120 days or less.

What you should do: Other than responding to any requests for information promptly, there is no action you should take. You will be contacted when your case is resolved. Please do not submit duplicate Forms 14039 or 14039-B, nor contact the IRS about the status of your identity theft claim. 

Additional resources:

• How IRS Identity Theft Victim Assistance Works
• What to do if you’re assigned an Employer Identification Number (EIN) you did not request

How long you may have to wait: We continue to experience processing times longer than the normal 90-day statutory period. Currently, we cannot provide a timeframe. Submissions are processed in the order in which they are received. 

What you should do: Please consider the significant additional approval time and plan for it. Do not submit duplicate claims. Duplicate filings will only cause more delays.

How long you may have to wait: Currently, the processing timeframe, is 15 weeks with the majority of applications being processed carrying received dates of May 2022. Delays in processing can occur due to applications missing information – most often a copy of the individual income tax return. Other issues include missing pages of Form 8802 and Social Security number mismatches. If this occurs, we send a letter requesting the missing information and temporarily hold the case to allow for a response. In many circumstances, responses are not received, and the cases are then closed.

To mitigate this type of delay, please verify accuracy of information and submit all supporting documents with your application. Page 4 of  IRS instructions for Form 8802PDF recommends customers submit a copy of their return to aid in processing. Write “COPY — do not process” on the tax return.  

The United States Residency Certification Program will temporarily accept a signed copy of the base return (for example, page 2 of Form 1040, page 6 of Form 1120, page 5 of Form 1065, etc.) in order to process the Form 8802. The base return will be kept as part of the Form 8802 application and will not be forwarded for processing. The base return will be used to process the Form 8802, rather than requiring the taxpayer to submit a copy of their full return. By filing a signed copy of the base return with your Form 8802, you are attesting that you have previously filed the income tax return with the IRS as shown on the signed copy.  This temporary deviation is effective April 4, 2022 and will continue for a pilot period of two years, after which, a determination will be made whether this deviation will be made permanent.

What you should do: If you receive a letter from IRS requesting additional information, please respond with the requested information timely to aid processing and prevent us from closing the application. If it has been longer than 15  weeks since an application has been submitted and you have not heard from us, please call  267-941-1000 (option 3) to ask for a status.

If you prefer for the certificate(s) to be mailed by a Private Delivery Service (PDS), provide a prepaid label and envelope/box and refer to Private Delivery Services for a list of available PDS locations.

We’re processing applications for recognition of exemption for tax-exempt organizations and continue to work rulings and determinations for employee plans and closing agreements for municipal issuers.

We’re processing payments for Forms 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds, on a priority basis.

Due to processing center reduced staffing, we’re working tax exemption applications and filed information returns (for example, Form 990 series) but the paper filed information returns are delayed in uploading to the Tax Exempt Organization Search tool on IRS.gov. The approved determination letters and electronic return filings are being uploaded to the Tax-Exempt Organization Search tool.

How long you may have to wait: Currently, we cannot provide a timeframe. Submissions through mail, fax, or online submission platform are processed in the order in which they are received. 

What you should do: Please consider the significant additional approval time and plan for it. Do not submit duplicate authorizations. Duplicate filings will only cause more delays.

Consider filing Form 2848 and 8821 online through Tax Pro. Tax Pro allows individual tax professionals who have a previously assigned Centralized Authorization Number (CAF) Number to securely request authorizations online in lieu of mailing or faxing paper forms.  Once necessary steps are completed and approved, the authorization is automatically loaded to the CAF Database.

The "Submit Forms 2848 and 8821 Online" tool allows both Form 2848 and Form 8821 authorizations containing electronic signatures to be securely uploaded online but still requires manual processing.

We’ll temporarily allow digital signatures on certain forms that can’t be filed electronically.

What you should do: You can send us the following forms with digital signatures if they are postmarked from August 28, 2020, through October 31, 2023:

• Form 11-C, Occupational Tax and Registration Return for Wagering
• Form 637, Application for Registration (For Certain Excise Tax Activities)
• Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return
• Form 706-A, U.S. Additional Estate Tax Return
• Form 706-GS(D), Generation-Skipping Transfer Tax Return for Distributions
• Form 706-GS(D-1), Notification of Distribution from a Generation-Skipping Trust
• Form 706-GS(T), Generation-Skipping Transfer Tax Return for Terminations
• Form 706-QDT, U.S. Estate Tax Return for Qualified Domestic Trusts
• Form 706 Schedule R-1, Generation Skipping Transfer Tax
• Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return
• Form 709, U.S. Gift (and Generation-Skipping Transfer) Tax Return
• Form 730, Monthly Tax Return for Wagers
• Form 1042, Annual Withholding Tax Return for U.S. Source Income of Foreign Persons
• Form 1066, U.S. Income Tax Return for Real Estate Mortgage Investment Conduit
• Form 1120-C, U.S. Income Tax Return for Cooperative Associations
• Form 1120-FSC, U.S. Income Tax Return of a Foreign Sales Corporation
• Form 1120-H, U.S. Income Tax Return for Homeowners Associations
• Form 1120-IC DISC, Interest Charge Domestic International Sales – Corporation Return
• Form 1120-L, U.S. Life Insurance Company Income Tax Return
• Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons
• Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return
• Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts
• Form 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies
• Form 1128, Application to Adopt, Change or Retain a Tax Year
• Form 2678, Employer/Payer Appointment of Agent
• Form 3115, Application for Change in Accounting Method
• Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts
• Form 3520-A, Annual Information Return of Foreign Trust with a U.S. Owner
• Form 4421, Declaration – Executor’s Commissions and Attorney’s Fees
• Form 4768, Application for Extension of Time to File a Return and/or Pay U.S. Estate (and Generation-Skipping Transfer) Taxes
• Form 8038, Information Return for Tax-Exempt Private Activity Bond Issues
• Form 8038-G, Information Return for Tax-Exempt Governmental Bonds
• Form 8038-GC Information Return for Small Tax-Exempt Governmental Bond Issues, Leases, and Installment Sales
• Form 8283, Noncash Charitable Contributions
• Form 8453 series, Form 8878 series, and Form 8879 series regarding IRS e-file Signature Authorization Forms and
• Form 8802, Application for U.S. Residency Certification
• Form 8832, Entity Classification Election
• Form 8971, Information Regarding Beneficiaries Acquiring Property from a Decedent
• Form 8973, Certified Professional Employer Organization/Customer Reporting Agreement
• Elections made pursuant to Internal Revenue Code section 83(b)

For more information, see details on using e-signatures for certain forms. 

If you were an employer who reduced your tax deposits because you planned to claim the sick and family leave credits, or employee retention credit in the second quarter of 2020, you may have received a notice stating there was a Failure to Deposit Penalty for Form 941.

Why you received this: When you reported the schedule of liabilities on Form 941, the liabilities didn’t match the reduction in deposits for every pay date. When this happened, you received a Failure to Deposit Penalty on the difference.

For more information, see Failure to deposit penalties on some employers claiming new tax credits.

Our telephone support is open, both for taxpayers and tax professionals, but we’re experiencing extremely long wait times due to limited staffing and extraordinarily high call volumes. 

To get help faster, try one of the following options.

IRS.gov: Our website is the best way to find answers to questions about tax law or check on your refund, tax payment, Economic Impact Payment, or Advance Child Tax Credit.

​​​​​You can go to IRS.gov for online tools such as: “Your Online Account,” IRS.gov/payments for various payment options – most of them free, and the Interactive Tax Assistant for answers to several tax law questions. 

For other issues, including how to get in-person help at our TACs, by appointment only, visit Let Us Help You to find a phone number for the office that can best answer your question.

Taxpayer Advocate Service (TAS): All local TAS phone lines remain open. TAS is committed to assisting taxpayers and advocating for their rights during this difficult period. Please call us at 877-777-4778 or visit Taxpayer Advocate Service – Contact Us to find your local TAS office phone number. We can determine if you qualify for our help, we can address your questions, or help set up an appointment.

Lien releases, certificates of discharge and other lien issues are being processed as normal.

How long you may have to wait: We’re assigning them within 10 days. You should receive a response within 30 days.

What you should do: Use the E-Fax line for our Advisory Consolidated Receipts (ACR) site (844-201-8382) for requests such as:

• Discharge of property from the federal tax lien
• Withdrawal of the notice of the federal tax lien
• Subordination of the federal tax lien

See Publication 4235, Collection Advisory Group Numbers and AddressesPDF for more information on the process for submitting applications for lien certificates, and related topics.

The Independent Office of Appeals (Appeals) is continuing to fulfill our mission of resolving disputes, without litigation, in a way that is fair and impartial to you and the government. If your case qualifies for an appeal, we will review the issues of your case with a fresh, objective perspective and schedule a conference with you. You have the option to meet with us in person or by telephone or video, or to conduct your appeal by correspondence. Many taxpayers prefer the convenience of a telephone or video conference. If you prefer to meet with us in person, we will do our best to identify a reasonably convenient time and location but you should know there are some limits and restrictions that may apply.

What you should do: An Appeals employee will contact you to schedule a conference in your case.  If you have already been contacted by an Appeals employee, direct any questions you have to that employee. 

How long you may have to wait: We are continuing to work through a high volume of cases that accumulated over the course of the pandemic and appreciate your patience. The amount of time you may have to wait to have your case heard in Appeals varies, but once you are contacted by an Appeals employee, you can help resolve your case timely by submitting all required information and scheduling a telephone conference or videoconference with the Appeals employee. 

The Office of Chief Counsel continues to resolve cases prior to trial and to litigate other cases. While the U.S. Tax Court has resumed in person proceedings, the U.S. Tax Court continues to conduct some trials and hearings virtually.  Taxpayers who wish to have their cases conducted virtually before the U.S. Tax Court, using Zoom for Government, may file a motion with the U.S. Tax Court requesting to be allowed to proceed remotely. Additional information is available at the United States Tax Court website.

Counsel is available to discuss your case by telephone, by videoconference, or meet with you or your representative face-to-face. Counsel continues to conduct both in person and virtual settlement days to provide additional opportunities for taxpayers to resolve their cases.

How long you may have to wait: The amount of time you may have to wait for resolution varies, but you may resolve your case quickly by settling prior to trial.

What you should do: If your case is docketed in the Tax Court, call the attorney assigned to your case. You can find that information on the document you received with the title “Answer.” Look in the signature block. Counsel attorneys can discuss your case by telephone, by arranging a video conference using Zoom for Government, or by meeting face-to-face.

Most Collection enforcement programs (including the systemic and automated lien and levy programs, and automated levy programs such as the Federal Payment Levy Program and the State Income Tax Levy Program) are currently paused. Field Collection revenue officers are assigned specific taxpayer cases and are operating with their normal authorities. Field and face-to-face contacts were restricted during the pandemic, but normal field activities resumed effective June 27, 2022.

The IRS is aware that some payments made for 2021 tax returns have not been correctly applied to joint taxpayer accounts, and these taxpayers are receiving erroneous balance due notices (CP-14 notices) or notices showing the incorrect amount. These are the first notices issued after a tax return is processed.

No immediate action or phone call needed: Taxpayers who receive a notice but paid the tax they owed in full and on time, electronically or by check, should not respond to the notice at this time. The IRS is researching the matter and will provide an update as soon as possible.

Aside from the first billing notice after a tax return is processed, we have paused the issuance of most balance due notices. Note however that revenue officers are operating with their normal authorities and may issue notices on the cases they are working.  

The IRS has expanded voice bot options to help eligible taxpayers easily verify their identity to set up or modify a payment plan while avoiding long wait times. Eligible taxpayers who call the Automated Collection System (ACS) and Accounts Management toll-free lines and want to discuss payment plan options can authenticate or verify their identities through a personal identification number (PIN) creation process. Setting up a PIN is easy: taxpayers will need their most recent IRS bill and some basic personal information to complete the process.

The IRS is transmitting certifications of seriously delinquent tax debt to the Department of State per its normal procedures. Affected taxpayers generally owe the IRS more than $55,000 (this figure is adjusted annually for inflation) in back taxes, penalties and interest for which the IRS has filed a Notice of Federal Tax Lien and the period to challenge it has expired, or the IRS has issued a levy. As of December 2021, taxpayers previously certified owe on average more than $240,000 in outstanding tax debt, often extending back more than 7 years. The great majority of these are pre-pandemic liabilities and are considered a priority for the IRS due to the amount owed and length of time the taxpayers have been delinquent without working with the IRS to resolve their debts. Per the law, the State Department generally will not renew their passport or issue a new passport after receiving this certification from the IRS, and in some cases may revoke the passport. 

IRS offers a number of programs to help taxpayers meet their tax obligations including payment agreements, Offers in Compromise, and, if the IRS determines a taxpayer cannot pay any of their tax debt, a temporary delay of the collection process. When the tax liability is paid in full, the taxpayer has been found to be currently not collectible, or the taxpayer has entered into an installment agreement or has a pending Offer in Compromise, the tax debt is no longer considered to be seriously delinquent and the certification to the State Department is reversed. 

• Payment agreements. Taxpayers can ask for a payment plan with the IRS by filing Form 9465. Taxpayers can download this form from IRS.gov and mail it along with a tax return, bill or notice. Some taxpayers can use the online payment agreement application to set up a monthly payment agreement without having to speak to the IRS by phone.
   
• Some taxpayers may qualify for an Offer in Compromise, an agreement between a taxpayer and the IRS that settles the tax liability for less than the full amount owed. The IRS looks at the taxpayer’s income and assets to decide the taxpayer’s ability to pay. Taxpayers can use the Offer in Compromise Pre-Qualifier tool to help them decide whether they’re eligible for an Offer in Compromise. 
   
• The IRS may temporarily delay the collection process by reporting the account as currently not collectible, if it determines a taxpayer is unable to pay any of their tax debt. To request a temporary delay of the collection process, taxpayers should contact the IRS at 800-829-1040 or call the phone number on their bill or notice. 

The denial of passports webpage has more information about the passport program.

As we continue operating while the COVID-19 virus is prevalent, our operations are affected in different ways. While we are engaged in critical tax administration activities, we’re considering the health and safety of taxpayers and our employees.

We’ve issued the following memos that cover a variety of issues for the tax professional community:

• TEGE Resumption of Exam Activities Guidance MemoPDF
• How to Know if it’s Really the IRS Calling or Knocking on Your Door