The Internal Revenue Service (IRS) is underway into the last stage of a devastating challenging tax season. It has had delays and backlogs due to COVID-19.
IRS to Conclude Searing Tax Season
The deadline for people who requested extensions to issue their 2019 tax returns is on Thursday. The news arrives mere three months following the non-extension filing deadline on July 15. It had also been pushed back from mid-April.
Progress on Backlog
The IRS has made developments in processing its paper tax returns backlog. This includes obtaining stimulus checks to eligible individuals. However, there is still much work to do.
"Millions of people who desperately rely on the IRS to receive much-needed financial assistance to pay for medical care, groceries, housing, are still waiting for those refunds and stimulus checks," according to Rep. Gerry Connolly (D-Va.), the chairman of the House Oversight and Reform Subcommittee on Government Operations, reported The Hill.
Rescheduling of Filing Deadline
Due to the arrival of the COVID-19 pandemic, the IRS augmented the filing deadline to July 15, while the traditional extension deadline of October 15 remained.
In late March, the IRS ordered most of its employees to remote work.
President Donald Trump also signed into law in March the $2.2 trillion CARES Act that permitted stimulus checks of a maximum of $1,200 per adult and $500 per child. The Paycheck Protection Program (PPP) offers loans to small businesses and other relief initiatives necessitating work from the IRS.
The merging of the prolonged deadline, new relief programs, and office closures have required the IRS to juggle numerous task which garnered both criticism and praise.
The IRS had processed over 153 million individual returns and issued almost 122 million refunds while giving stimulus payments and alleviating cyber attacks.
According to Rettig, the agency had a backlog of an estimated 5.3 million yet to be opened in the mail. He stated that tackling the mail; the agency attempts to prioritize processing tax returns and refunds.
IRS Issues IBOR Fallback for ARRC and ISDA Provisions
The IRS and Treasury Department issued Revenue Procedure 2020-44 on October 9. This provides that an alteration to a debt instrument includes fallback language published by the Alternative Reference Rates Committee (ARRC) or the International Swaps and Derivatives Association (ISDA). It does not result in a touted taxable exchange of that instrument, reported Cadwalader.
IRS Drafting Plan to Decommission Legacy Systems
The IRS is working on a method to decommission legacy IT systems. It is aiming to go beyond the actual plans to unplug machines.
According to IRS officials on Tuesday, the strategy to decommission its legacy systems is taking the form of a concert with the work of the Enterprise Digitalization and Case Management Office, reported Federal News Network.
IRS List Indicates States with Most Americans Who Did Not Receive COVID-19 Stimulus Payments
The IRS list had issued a breakdown per state of the estimated nine million people granted with a special mailing in September. The goal was to persuade them to see if they could be granted an Economic Impact Payment.
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