The Internal Revenue Service has a number of liaisons who work with practitioner groups. They have a monthly conference call on the first Thursday of each month. Here is updated information received during a June 4, 2020 conference call:
1. The IRS has reported that their campus service centers have about 10 million mail items to process. These include:
a. Paper filed tax returns.
b. 1040-V voucher payments for 2019 returns.
c. 2019 and 2020 estimated tax payments.
d. 2019 tax extension forms – some with payments enclosed.
e. Answers to various IRS notices.
f. Amended returns.
g. Other taxpayer-initiated correspondence.
2. Many campus service center employees are now returning to work in the first half of June. Processing the above mail items will take several months to catch up. It is expected that they will be looking at the dates of the mail items to waive late processing interest and penalties. Allow the IRS several months to work these processing backlogs.
3. IRS employees are manning telephone inquiry lines. There are many callers, and waiting times are significant. In some cases, calls are being dropped out of a phone queue. The callers should call back at another time, or a later date.
4. Many of these calls have to do with questions about Economic Impact Payments (stimulus payments). The IRS phone representatives do not have access to taxpayer account records. They can only access general Frequently Asked Questions (FAQs) that appear on the IRS website www.irs.gov main page (see “Get my payment” or search “Economic Impact Center”). Tax practitioners should be aware of these questions and answers themselves.
5. Some 2019 tax refunds have been delayed. When someone searches “Where’s my refund?” on irs.gov and the answer is “in process”, this processing may take some additional time to resolve due to availability of employees to process them. “In process” means that eventually the return will be processed.
6. The IRS is now sending millions of debit card payments for the Economic Impact Payment (stimulus payment). This occurs when no bank account information was available for 2018 or 2019 returns. These debit card payments come in plain white envelopes. These debit cards can be used to put the payment directly into a taxpayer’s bank account. There are instructions on the IRS FAQs about obtaining a replacement debit card if it was lost or destroyed.
7. There are some circumstances when Economic Impact Payment (stimulus payment) needs to be returned to the IRS. There are instructions about returning overpayments in the IRS FAQs. Overpayments can occur if the taxpayer (or spouse) has died. There have been other circumstances where Social Security Survivor dependent children have received $1,200 payments which should be returned, since the surviving payer will also be getting the $1,200 payment, plus another $500 for a dependent child.
8. There are temporary procedures in place to fax for quick refunds due to Net Operating Losses under the 2020 CARES Act. Forms 1139 and 1045 are available to claim quick refunds for Prior Year Minimum Tax Liability and for Net Operations Losses. Refer to irs.gov for further details. Search on “Form 1139 and 1045” on IRS.gov.
9. Form 1040-X Amended Returns will be available for electronic filing later this summer. Watch for more details later this summer.