The IRS isn’t just hanging up on taxpayers, in 49 percent of cases, it is increasingly failing to respond to taxpayers who send them letters (but don't worry–they are still speedy when it comes to cashing checks).
According to an IRS watchdog report, the number of “over-age” correspondence which went unanswered by the IRS rose from 40 percent in fiscal year 2012 to 49 percent in fiscal 2015. Any letters that go unanswered within 45 days are considered over-age, however, the IRS has a responsibility to respond to all correspondence in a timely manner, to address all of a taxpayer’s issues, and request additional information. If they can't do that, the IRS must at least contact the taxpayer to give them a status.
Based on an inventory of unresolved correspondence, one of five unanswered letters deals with fraud, including taxpayers whose Social Security numbers were used to file a fraudulent tax returns, taxpayers who are at risk of their Social Security number being misused, multiple individuals using the same Social Security number when filing, or one taxpayer filing multiple returns. According to the report, this problem is only growing worse.
Ignoring taxpayer mail imposes a real costs and burden to taxpayers affected. Taxpayers have indicated in customer service surveys that they were dissatisfied with the length of time the IRS was taking to resolve their cases and to obtain information about their cases.
The IRS is also paying unnecessary interest fees. They paid more than $27.6 million to taxpayers for not processing or resolving correspondence cases quickly enough.
IRS Commissioner John Koskinen agrees that there’s a problem, but as with every other failure of the IRS, he blames budget cuts:
Testifying before the U.S. Senate, the head of the IRS didn't deny the problem.
“The level of taxpayer service last year was totally unacceptable,” said IRS Commissioner John Koskinen.
He puts the blame on budget cuts. He says more than $1.5 billion in cuts since 2010 have forced the IRS to cut staff by 15,000 employees.
“It is a simple equation of if we have additional resources, we'll hire the people and be able to answer the calls,” Koskinen said.
President Obama is asking for an extra $1 billion for the IRS for next year's budget. Koskinen says some of that would go to hire more staff for customer service.
According to the inspector general report, while the IRS has made some progress, managers at the agency still are ignoring recommendations:
However, despite these actions, the percentage of correspondence over-age continues to increase. This results, in part, from some managers continuing to not follow internal Highlights guidelines that require the use of over-age reports to monitor and reduce inventory. TIGTA’s analysis of eight customer service representatives’ over-age reports for three consecutive weeks identified that 16 to 82 percent of their over-aged assigned cases remained unresolved.
TIGTA has previously reported on this same issue. Management responded that they would ensure that these reviews are completed by managers noting that they would develop a consistent process to ensure that correspondence over-age report reviews are completed by managers. However, some managers continue to not adhere consistently to the required use of over-age reports, which contributes to the IRS’s inability to effectively reduce over-aged inventory.
Throwing more money at IRS problems with no accountability or oversight is the only solution that Kosinen and the Obama Administration know. Some funding has been returned to the IRS yet their responsiveness has only grown worse over the past five years.
The biggest victims in this case are the ones who have suffered identity theft because of the IRS’s lax security procedures and who are now victims of the agency’s slothfulness. They are already likely facing financial hardship and headaches sorting out how their private information has been used. The IRS ignoring their letters just compounds the injury.