National Taxpayer Advocate Erin Collins wrote in a report released Monday that the coronavirus-related closure of notice production centers led to a backlog of 20 million letters that needed to be mailed.
The content of these notices included everything from refund and return status updates to compliance actions to collection and payment deadlines.
The closure occurred April 8 and production did not resume until June.
In some cases taxpayers are just now receiving notices with past-due payment, or response, dates because the documents were sent out in their original form once operations picked back up.
“While the IRS is providing additional time for payment (July 10, 2020 or July 15, 2020), it will still lead to widespread taxpayer confusion about deadlines to take certain actions,” Collins wrote.
The tax agency is working to help alleviate that confusion by attaching “inserts” to the original documents, explaining postponed due dates and relief provided on penalties and interest. However, there is concern that taxpayers may not read the inserts.
Operations elsewhere at the IRS also ground to a halt during the pandemic. Millions of Americans should expect “extreme” refund delays, Collins said, because the agency not only suspended processing paper returns, but it also has some taxpayers’ returns on hold for a variety of reasons. These taxpayers may not have been contacted about the additional information required – or they may not have been able to reach the IRS to provide it.