Mar
Laying off IRS employees is not in the best interest of taxpayers. While no one enjoys dealing with the IRS, it’s important to recognize that IRS employees are public servants responsible for ensuring the tax code is fairly implemented. Adequate staffing at the IRS leads to better tax enforcement, improved customer service, and faster processing of payments and refunds. With the funding from the Inflation Reduction Act, the IRS was able to reduce massive backlogs and improve service levels significantly. However, with recent budget cuts leading to layoffs, these improvements are at risk.
Why Are IRS Layoffs Happening?
The Inflation Reduction Act provided significant funding to the IRS, allowing the agency to hire more employees and improve customer service. However, recent budget cuts have forced the IRS to reduce staffing levels, affecting multiple areas of tax administration.
Potential Impacts of IRS Layoffs
Extended Hold Times
- With fewer IRS employees available to answer phone calls, wait times could increase significantly when taxpayers attempt to resolve issues.
Manual Processing Backlogs
- Many tax returns, especially paper-filed ones or those flagged for additional review, require manual processing. With reduced staffing, these backlogs could grow, leading to delays in refunds and issue resolution.
Increased Risk of Errors
- The IRS has quality control and error-checking functions in place, but fewer employees may mean mistakes slip through more frequently, causing incorrect payments or extended refund delays.
Delayed Payment Plan Approvals
- Taxpayers who need to set up installment agreements for outstanding balances may experience longer approval times due to staffing shortages.
How to Minimize Potential Issues
- File Early: The earlier you file, the less likely you are to be caught in processing delays.
- Double-Check Information: Ensure all information, including Social Security numbers and income statements, is correct to avoid unnecessary scrutiny.
- Use E-Filing and Direct Deposit: Electronic filing and direct deposit help minimize delays associated with manual processing.
While IRS layoffs are expected to impact taxpayers, careful planning can help mitigate potential issues. If you have questions or need assistance with your tax return, our office is here to help.
