Thousands can get tax refunds as the IRS reviews old returns

Federal tax season begins Jan. 23, and getting refunds right away may be easier this year. (AP Photo/Mark Lennihan)

Federal tax season begins Jan. 23, and getting refunds right away may be easier this year. (AP Photo/Mark Lennihan)

AP

You may be able to get a refund on taxes you inadvertently overpaid three years ago.

And 2022 tax refunds may be easier.

That’s promising news from the Internal Revenue Service as it prepares for the new tax filing season. The deadline to file most tax returns for 2022 is April 18, though residents of many California stricken counties, as set by the Federal Emergency Management Agency, You have until May 15th.

Many consumers may have already seen new refunds that were owed to them years ago.

The IRS recently ended The so-called “final corrections for the 2020 tax year” for people who overpaid taxes on unemployment compensation they received in 2020.

About 12 million people across the country are owed $14.8 billion in refunds. The average refund is $1,232.

It is not clear how many Californians are returning. In 2020, 4.9 million California returnees reported unemployment compensation. The unemployment rate was in the state more than 16% In the spring of 2020.

The refund confusion is a result of the 2021 federal American Rescue Plan, which became law in March 2021. It allowed people to exclude from their taxable income of up to $10,200 in 2020 if their income was less than a certain amount.

The problem came because many people filed their tax returns before the ruling became law.

So the IRS started looking at those filings, calculating how much tax people owed, and sending refunds to people who qualified. In some cases, the money “on hand” is applied to other taxes owed or other debts.

Affected taxpayers should obtain a letter from the IRS stating the action it took.

Tax refund in 2023

In the recent past the IRS has had trouble keeping up with tax returns. Last year, about two-thirds of individual taxpayers were eligible for a refund, for an average of about $3,200.

But Erin Collins, the national taxpayer attorney, I reported this week that “the IRS has failed to live up to its responsibility to make timely refunds to millions of taxpayers for the third year in a row.”

She saw some reasons for optimism in the future.

Its report said the IRS received significant additional funding to increase its consumer service staff. It has hired 4,000 new customer service representatives, and aims to hire another 700 people to provide personalized service at taxpayer assistance centers.

Of course, this does not mean that the process will suddenly become more efficient.

“Within comes growth pains,” Collins said. “When new employees are added, they must be trained. For most positions, the IRS does not maintain a separate cadre of trainers.”

This means that veteran IRS employees must be pulled from their jobs to provide this training.

“In the short term, that could mean fewer employees helping taxpayers, especially experienced employees who are likely to be the most effective coaches,” Collins said.

The IRS has become a favorite target for House Republicans, who voted Monday cut significantly IRS funding. They asserted that it would be used to unleash an army of thousands of IRS agents who would target middle-class taxpayers by closely scrutinizing their tax returns.

However, the bill is likely to go nowhere in the Democratic-run Senate.

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David Lightman is McClatchy’s chief congressional correspondent. He has been writing, editing, and teaching for nearly 50 years, with stops in Hagerstown, Maryland; Riverside, California; Annapolis. Baltimore. And since 1981, Washington.

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