The
initiative, part of a decade-long, $60 billion program to
modernize systems and improve tax enforcement, will allow
taxpayers to digitally submit all correspondence, non-tax forms
and responses to IRS notices, the Treasury said.
Many of these forms now can only be submitted on paper by mail,
and the plan could eliminate handling of up to 125 million such
documents per year.
Most U.S. tax returns are already filed digitally, which results
in faster refunds. But the COVID-19 pandemic and associated
filing delays and staffing shortages saddled the IRS with a
massive backlog of 22.5 million unprocessed paper tax returns by
February 2022 that needed some form of manual processing.
The agency has been churning through the backlog, partly with
the help of new scanning technology, reducing it to 2.15 million
returns needing processing, reviews or corrections.
U.S. Treasury Secretary Janet Yellen said in excerpts of remarks
at an IRS facility in McLean, Virginia, that taxpayers will
always have the choice to submit documents by paper.
"For those taxpayers, by filing season 2025, the IRS is
committing to digitally process 100 percent of tax and
information returns that are submitted by paper – as well as
half of all paper correspondence, non-tax forms, and notice
responses," Yellen said.
The new scanning technology and other improvements in IRS
customer service were made possible by funds provided in last
year's climate-focused Inflation Reduction Act, initially
approved at $80 billion over a decade, but reduced to $60
billion by this year's bipartisan deal to increase the federal
debt ceiling.
The funds are separate from IRS' annual operating budget, which
some Republicans in Congress have vowed to cut. Yellen said
"stable and sufficient annual appropriations" for the IRS were
needed to sustain progress on initiatives to improve customer
service, such as the paperless processing effort and reducing
phone call response times.
(Reporting by David Lawder; Editing by Christian Schmollinger)
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