The Internal Revenue Service has way too many unprocessed tax returns from last year — and far too few job applications for workers who will help the agency dig out of the backlog.
Though the IRS is seeking to fill 5,000 positions at several campuses across the country, only 179 positions have been filled so far, according to Erin Collins, national taxpayer advocate at the IRS.
At same time, the IRS is facing a backlog that, as of late December, included 6 million unprocessed 2021 tax returns and another 2.3 million amended returns.
The pay for the clerical jobs wading through the paperwork isn’t exactly enticing, Collins said in congressional testimony Tuesday. Many of the roles connected to submission-processing start at a federal-worker pay grade that’s just under $25,000 a year, she said.
At a time when employers are raising wages to draw in and keep workers during a labor shortage, “it is not surprising that the IRS is having difficulty finding enough suitable job applicants,” she wrote in testimony to a House of Representatives Ways and Means Oversight Subcommittee.
“It is a challenge we have in the market,” Collins told lawmakers at the hearing, noting the jobs at the IRS facilities require workers to be physically present to handle the documents.
Austin, Texas, is the spot for one IRS campus, but Rep. Lloyd Doggett, a Democrat, said the low starting pay for the jobs will not work for his constituents. “Here in Austin, that’s not a living wage,” he said.
More pay, bonuses, hazard pay and other compensation perks are necessary steps, Collins said. But she still doesn’t think “we are going to be able to hire enough people to get us out of this hole.”
Last week, the IRS said it was temporarily reassigning 1,200 staffers as part of a “surge team” to help with the backlog. That’s “a good first step,” Collins said Tuesday. Still, she added, “we are going to need more than the 1,200.”
The IRS had almost 82,000 workers, including more than 10,500 seasonal workers, in fiscal year 2021, agency statistics show.
The backlog is an outcome of temporary IRS office closures early in the pandemic, juggled against the agency’s duties distributing three rounds of stimulus checks, Child Tax Credit payments and various tax-law changes. For years, the IRS workload has been increasing as its headcount has been contracting, the agency said.
With the 2022 tax-filing season underway, IRS Commissioner Charles Rettig says he’s all too aware of the 2021 backlog, and is taking “aggressive actions” to reduce it with the resources he has. That includes the “surge team” and mandatory overtime.
In a letter to lawmakers on Monday, Rettig wrote: “We must continue pursuing innovative strategies while supporting the hard work and dedication of our employees to fulfill our commitment to return inventories to a healthy level before entering the 2023 filing season.”