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Tax season kicks off as IRS begins to deploy $80 billion in funding

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Tax season kicked off for individual filers Monday with a much bigger IRS customer support team and enhanced technology because the agency begins to deploy its nearly $80 billion in funding. 

Over the past several months, the IRS has hired 5,000 recent customer support staff, aiming to “significantly increase” the variety of answered calls, Deputy Secretary of the Treasury Wally Adeyemo told reporters Friday.

IRS service was flagged as one in every of the agency’s “most serious problems” within the National Taxpayer Advocate’s 2022 annual report, with only 13% of callers reaching live assistance in the course of the 2022 filing season.

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The IRS will bolster in-person support at Taxpayer Assistance Centers across the country, putting the agency heading in the right direction to “triple the variety of Americans served,” Adeyemo said.

The agency also plans to enhance customer support through technology, including the power for filers to answer certain IRS notices online and for the IRS to scan paper returns. 

“These improvements showcase how we’re modernizing each technology and customer support to bring the IRS into the twenty first century and the way the IRS plans to deploy [Inflation Reduction Act] resources within the years to come back,” Adeyemo said.

Enacted in August, the Inflation Reduction Act allocated $79.6 billion to the IRS over the subsequent 10 years, and Treasury Secretary Janet Yellen outlined priorities soon after — resembling clearing the tax return backlog, improving customer support, overhauling technology and hiring employees.

The IRS goals to deliver a plan for the nearly $80 billion in funding to Yellen in February, in response to a Treasury official. 

Meanwhile, House Republicans in January voted to slash the newly enacted IRS funding after months of scrutiny of the agency’s plans. Nonetheless, the measure doesn’t have the support to pass within the Democratic-controlled Senate.

‘Light at the tip of the tunnel’ for the IRS

The 2023 tax filing season kicks off after a difficult period for the IRS. Despite guarantees to clear the backlog, as of Dec. 23 there have been still 1.91 million unprocessed individual returns received in 2022, in response to the agency.

Nonetheless, the IRS could also be primed for a greater 2023 filing season after making “considerable progress” in reducing the pileup, National Taxpayer Advocate Erin Collins said in her annual report.

“We’ve begun to see the sunshine at the tip of the tunnel,” she wrote. “I’m just unsure how much further we’ve to travel before we see sunlight.”

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