IRS wraps up tax season

The Internal Revenue Service reported stronger performance on Monday, April 15, as it concluded this year's tax filing season, saying it had answered 1 million more phone calls from taxpayers and helped 170,000 people in person compared to last year.

The IRS has been improving its technology and taxpayer service, thanks to the extra boost in funding from the Inflation Reduction Act of 2022. The agency said it received 75 million more visits to its IRS.gov site, driven by improvements to its "Where's My Refund" tool that provided more details about refund status and notifications about when the IRS needs more information. The website had nearly 500 million visits, an 18% jump over last year.

The "Where's My Refund?" tool received over 275 million of those visits, up 62 million from 2023 for a 29% increase. The IRS also began testing a free tax program called Direct File in 12 states, and the agency reported Monday that it met its goal of enabling 100,000 taxpayers to successfully file their returns using the new program.

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"Taxpayers continued to see major improvements from the IRS during the 2024 tax season," said IRS Commissioner Danny Werfel in a statement Monday. "A well-funded IRS is like night and day for taxpayers. With the help of more funding and added resources, service for taxpayers this filing season eclipsed levels seen during the past decade. This tax season meant real-world improvements for people looking for help, whether calling, visiting in-person or using IRS.gov."

The IRS is hoping to protect as much of its funding as it can. The extra $80 billion over 10 years designated under the IRA has already been reduced by about $20 billion after a deal last year to raise the debt limit, with most of the cuts targeting tax enforcement. 

Through April 6, the IRS processed more than 100 million individual tax returns. Tens of millions more will come in advance of the April deadline, the busiest time of the year for tax returns. The agency also projects about 19 million taxpayers will file extensions, which will be due Oct. 15.

Since the start of the January tax season, the IRS has delivered more than $200 billion in refunds through early April. The average refund was $3,011, a 4.6% increase from last April's average of $2,878.

The IRS added 5,000 new telephone assistors last year, and the level of service on its main phone lines exceeded 88%. That's above the 84% level seen last year and over five time better than during the pandemic, when the level of service dropped to just 15% in 2022.

The IRS answered more taxpayer calls on its live assistor lines this year, a 16.8% increase from 2023. Agency assistors handled 7,608,000 calls, up from 6,513,000 the year before. Automated lines handled another approximately 7 million calls, 280,000 more than the previous year. Taxpayers waited, on average, just over three minutes for help on the IRS main phone lines. That's down from four minutes in 2023 and 28 minutes in filing season 2022.

The tax agency provided callback options on 97% of its phone lines this filing season, and offered callback for over 4 million taxpayers, more than double the 1.8 million calls in 2023. This option, offered when phone lines were busy, saved taxpayers nearly 1.4 million hours of wait time on the phones.

Taxpayers certainly needed help from the IRS: The National Taxpayers Union Foundation also released on Tax Day its annual tax complexity study, using the latest IRS data to estimate the compliance and time burdens associated with filing income taxes. The numbers are enormous: Americans have spent 6.5 billion hours preparing their income tax returns, with an "opportunity cost" of the time spent laboring over taxes exceeding $280 billion for preparation alone. The average American individual income tax return now requires nine hours to complete.