The (Pandemic) Tax Man Cometh – How COVID Has Complicated Filing

We’ve often heard that the only certainties in life are death and taxes, but does this still hold during a global pandemic? COVID has shattered Internal Revenue Service (“IRS”) Operations. Taxpayers who filed a 2019 paper return and are entitled to a refund may be waiting a long time before they see those deposits. In fact, at one point, the IRS suspended the processing of paper returns and had an estimated 4.7 million on hold. While the IRS is now open and beginning to process returns, payments, refunds, and correspondence, there are still many delays.


The IRS recognizes these are challenging times and realizes that COVID-19 is still an issue for many Americans. To lighten the load, they’ve offered a wide range of taxpayer relief options with three main goals to help taxpayers.

  1. “First, we (the IRS) want to do everything we can under existing rules for immediate, broad-based relief from unpaid liabilities resulting from COVID-19 issues, including those affected by IRS mail processing and correspondence delays.”
  2. “Second, we’ll remove bureaucratic barriers and expand flexibilities to all taxpayers whose financial condition has been affected by COVID-19. This includes those still facing longstanding tax issues.”
  3. “Third, we’ll balance the relief provided against the need to uphold the nation’s tax laws. We’ll make sure we have adequate resources available to work complex cases or address egregious non-compliance. And we will work to secure the government’s interests in the event of future bankruptcies to uphold the laws and help ensure fairness in the tax system.”


A Word of Caution:

While the IRS is being a bit more flexible during these unprecedented times, you won’t want to disregard them. Do not overlook or ignore tax notices and do not go silent. Tax issues will not get better over time. Although the IRS can be intimidating, they do have agents just like you who are there to help. The IRS wants to help and, when appropriate, will abate penalties; extend payment plans; expand access to installment plans; and provide relief to taxpayers having trouble meeting the terms of a previously accepted offer to settle past tax debts.


Deadlines to Note:

 The due date to file your 2020 Personal Income Tax Return has changed from Thursday, April 15, 2021, to Monday, May 17, 2021. This change is ONLY for the tax year 2020. 


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