Loading...

Senators Seek Taxpayer Penalty Relief Amid IRS Backlog

January 28, 2022 by Dan McCue
<strong></img>Senators Seek Taxpayer Penalty Relief Amid IRS Backlog</strong>
The seal of the U.S. Treasury Department. (Photo by Dan McCue)

WASHINGTON — Sens. Bob Menendez, D-N.J., and Bill Cassidy, R-La., are leading an effort to convince the U.S. Department of the Treasury and the Internal Revenue Service to provide penalty relief for taxpayers amid what they describe as the “extensive” and “ongoing” processing backlogs at the nation’s tax agency.

“While the COVID-19 pandemic has strained every federal agency, the impact on the IRS has been particularly severe,” Sens. Wyden, Merkley, both of Oregon, and about two dozen other senators wrote Treasury Secretary Janet Yellen and IRS Commissioner Charles Rettig this week. 

As of the end of December, they said, the IRS continued to have a backlog of 6 million Forms 1040 (Individual Income Tax Returns) and 2.3 million amended individual tax returns. 

“In addition, the IRS has 2 million Forms 941 (Employer Quarterly Tax Returns) that must be processed before the nearly 500,000 amended Forms 941 can be processed,” the senators wrote.

The lawmakers noted the delayed processing of amended returns has been particularly devastating to small businesses, whose applications for emergency loans from the Small Business Administration have been caught in limbo nearly two years after the COVID-19 pandemic began.

“Recognizing the extraordinary challenges of the COVID-19 pandemic, in addition to the IRS operating with antiquated technology and a constrained budget, we find the current situation alarming,” the senators wrote. “We stand ready to support the IRS and look forward to hearing how we can help you address any obstacles facing the agency. 

“However, we respectfully request the IRS consider the following measures to bring immediate relief to taxpayers, and reduce the backlog, during this tax filing season,” the lawmakers added. “… While we recognize no single action will alleviate issues that have resulted from difficulties at the IRS spanning administrations of both political parties, these steps would provide our constituents with greater certainty as we enter this year’s filing season.”

In addition to Sens. Menendez and Cassidy, the letter was signed by Sens. Ron Wyden, D-Ore., Jeff Merkley, D-Ore., Cory Booker, D-N.J., Michael Bennet, D-Colo., Richard Blumenthal, D-Conn., Sherrod Brown, D-Ohio, Ben Cardin, D-Md., Tom Carper, D-Del., Chris Coons, D-Del., Catherine Cortez Masto, D-Nev., Tammy Duckworth, D-Ill., Kirsten Gillibrand, D-N.Y., Tim Kaine, D-Va., Amy Klobuchar, D-Minn., Patrick Leahy, D-Vt., Cynthia Lummis, R-Wyo., Joe Manchin, D-W.Va., Chris Murphy, D-Conn., Jacky Rosen, D-Nev., Debbie Stabenow, D-Mich., Chris Van Hollen, D-Md., Mark Warner, D-Va., and Raphael Warnock, D-Ga.

Dan can be reached at dan@thewellnews.com and at https://twitter.com/DanMcCue

In The News

Health

Voting

Taxes

April 29, 2022
by Tom Ramstack
Justice Dept. Sues Trump Campaign Manager Saying He Hid $16M in Taxable Income

WEST PALM BEACH, Fla. — The Justice Department is suing Paul Manafort, the former presidential campaign manager of Donald Trump,... Read More

WEST PALM BEACH, Fla. — The Justice Department is suing Paul Manafort, the former presidential campaign manager of Donald Trump, after he allegedly hid taxable income he was paid as a consultant for business and political interests in Ukraine. Prosecutors are seeking $2.9 million of the... Read More

March 30, 2022
by Madeline Hughes
FTC Sues Creators of TurboTax for Allegedly Misleading Consumers

WASHINGTON —The Federal Trade Commission is suing the makers of TurboTax, Intuit Inc., over an allegedly “deceptive” ad campaign offering... Read More

WASHINGTON —The Federal Trade Commission is suing the makers of TurboTax, Intuit Inc., over an allegedly “deceptive” ad campaign offering “free” services and then having charges appear as Americans file their taxes with the online software. “TurboTax is bombarding consumers with ads for ‘free’ tax filing... Read More

January 28, 2022
by Dan McCue
Senators Seek Taxpayer Penalty Relief Amid IRS Backlog

WASHINGTON — Sens. Bob Menendez, D-N.J., and Bill Cassidy, R-La., are leading an effort to convince the U.S. Department of... Read More

WASHINGTON — Sens. Bob Menendez, D-N.J., and Bill Cassidy, R-La., are leading an effort to convince the U.S. Department of the Treasury and the Internal Revenue Service to provide penalty relief for taxpayers amid what they describe as the “extensive” and “ongoing” processing backlogs at the... Read More

December 17, 2021
by Reece Nations
Build Back Better Impasse Jeopardizes Child Tax Credit Benefits

SAN ANTONIO — Although the last Child Tax Credit payments were issued on Wednesday, social justice scholars like Rajni Shankar-Brown... Read More

SAN ANTONIO — Although the last Child Tax Credit payments were issued on Wednesday, social justice scholars like Rajni Shankar-Brown of Stetson University believe the program’s benefits far outweigh its costs. The Child Tax Credit was expanded earlier this year by the passage of the American... Read More

November 5, 2021
by Kate Michael
Money for Tech in Tax Compliance Initiative Could Combat Fraud, Prevent Frustration

WASHINGTON — As Congress finally looks ready to vote on infrastructure and spending bills, policy experts on both sides of... Read More

WASHINGTON — As Congress finally looks ready to vote on infrastructure and spending bills, policy experts on both sides of the aisle have focused on one key initiative that was put forward to pay for new government investments — tax compliance.  Biden proposed funding much of... Read More

November 5, 2021
by Dan McCue
In Win for Northeast Centrists, SALT Relief Included In Spending Bill

WASHINGTON — House Democrats agreed late Thursday night to modify the $1.85 trillion reconciliation bill to include a provision raising... Read More

WASHINGTON — House Democrats agreed late Thursday night to modify the $1.85 trillion reconciliation bill to include a provision raising the cap on the state and local tax deduction from $10,000 to $80,000. The measure, also known as the Build Back Better Act, is expected to... Read More

News From The Well