According to Tuesday's report by the Treasury watchdog, the Covid pandemic led to an estimated 8 million backlog in paper-filed tax returns from businesses at the IRS for 2020.
This is a 3,230% increase over the end of 2019, when there were approximately 239,000 paper returns that the IRS was still waiting to be processed. According to the report published by Treasury Inspector General for Tax Administration.
According to the report, delays were mainly due to "unprecedented" and "disastrous actions" taken by the IRS during the Covid-19 pandemic.
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These measures included closing Tax Processing Centers nationwide and extending the deadline for federal income tax filings to July 15.
According to the watchdog report, backlogs affected primarily employment tax returns. Nearly 5.5 million were still awaiting processing at 2020's end. For example, delays in business tax returns for corporations, partnerships, estates, gifts, fiduciaries, and tax-exempt organisations also had an impact.
According to Kenneth Corbin (commissioner of the IRS' wage and investment division), the backlog in business tax returns has fallen significantly to 291,000 as of July 20,21. This letter was written in response to the report.
