The Internal Revenue Service is continuing to open its operations around the country, beginning with several states in June and most of the remaining states by the middle of July. “They’re not doing this blindly, but have established a systematic approach,” said Stephen Mankowski, immediate past president and current tax chair of the National Conference of CPA Practitioners, who recently attended virtual meetings with Washington officials.
“The majority of IRS employees were able to telework, but in areas where taxpayers and tax professionals needed direct assistance, such as the Practitioners Priority Service, they came back sooner,” he said. “The priority line had been down since mid-March, but started coming back in June.”
“While a lot of employees were teleworking, a lot were not. A number of collections and field personnel were still able to work on outstanding cases,” he said. “Parts of certain facilities could potentially close as a safety precaution. While there’s a significant backlog of work, as well as delays on phones, the IRS is getting back to its new normal, but taking the time to do so safely and securely,” he said.
The IRS Forums will be virtual this year, making it possible for preparers from all sections of the country to attend without being limited geographically, according to Mankowski. “Instead of having different speakers at some of the sessions, now everyone will hear the same message,” he said. “From that standpoint, it can be a positive.”
The stimulus payments took their toll, according to Mankowski: “There has been an enormous amount of time and energy spent on Economic Impact Payments with an all-out effort in Wage & Investment and IT,” he observed. “Over 150 million Economic Impact Payments have been sent. It’s amazing that the IRS could get this done in a virtual work-from-home position. Several million people without filing requirements may still be eligible — these individuals are urged to access IRS non-filer portals and tools.”
Now the IRS will have to come up with yet another new form because there needs to be reconciliation for the EIPs. A payment may have been based on 2018 rather than 2019 income, so there could be additional stimulus money available or there could be someone who had a child during 2020 so they’re due an additional $600 for the child. Or a student who was ineligible because they were claimed as a dependent by their parents may now have become eligible for a $1,200 payment.
“It will make [the] next filing season interesting,” Mankowski said.
Happily, repayments won’t be necessary, according to Mankowski. “If your stimulus payment was based on your 2018 return, but you would have gotten less if you had filed your 2019 return sooner, there’s no payback. But if you received a reduced amount based on 2018 and should have received a higher amount, you can add it in as an additional payment or a reduction in tax liability for 2020, so you would be made whole,” he said.
The IRS was dealt a very difficult hand, he noted: “Things keep getting thrust at them — tax law changes from the Affordable Care Act, the Tax Cuts and Jobs Act, the Taxpayer First Act, and the economic stimulus payments, all with declining budgets from year to year. With all of the negatives, they still go out and do a great job with what they have.”
