IRS Details 2024 Tax Season, Report Urges More Changes at Agency

The 2024 tax season will officially start  on January 29, 2024, according to the Internal Revenue Service (IRS).

That is when the IRS will start accepting and processing returns for the 2023 tax year, although taxpayers are free to start working on their returns now. IRS Free File, which allows participating software companies to collect returns and store them until they can be electronically filed, opened on January 12, 2024.

The IRS expects more than 128.7 million individual tax returns to be filed by the April 15, 2024, tax deadline.

And IRS leadership says the $60 billion or so pumped into the agency from the Inflation Reduction Act (IRA) is paying dividends.  

"IRS employees are working hard to make sure that new funding is used to help taxpayers by making the process of preparing and filing taxes easier,” said IRS Commissioner Danny Werfel.

Some of the changes for 2024 filing include:

·         Expanded in-person service through the opening/reopening of Taxpayer Assistance Centers.

·         An expanded customer call back feature to cut long phone wait times.

·         Improvements in the Where’s My Refund? tool.

·         Enhanced paperless processing.

·         Enhanced individual IRS online accounts that include chat help, the ability to store bank accounts for payments, and more.

·         A pilot program called Direct File that allows certain taxpayers the option of filing their returns directly with the IRS for free. Direct File is on a phased rollout and is expected to be available in mid-March.

National Taxpayer Advocate Annual Report

Meanwhile, National Taxpayer Advocate Erin Collins issued her 2024 report to Congress and it contains a mix of praise and concern. 

Advocate Collins said that while it is almost completely back to “business as usual” at the IRS after the pandemic, the “baseline level of ‘business as usual’ was not good enough.”

The report praised the IRS for eliminating most of its tax return backlog, issuing most refunds on time, and answering taxpayer phone calls at pre-pandemic levels. In 2023, the IRS answered 29 percent of taxpayer phone calls, up from 11 percent in 2022.

“Overall, the magnitude of successes exceeded the areas of weakness in 2023, and most metrics showed significant improvement from the depths of the [COVID-19] pandemic,” Advocate Erin Collins wrote.

However, the report questioned the way IRS is deploying its staff, noting that sometimes customer service representatives were sitting around when call volume was low, and were short-staffed when volume was heavy, wasting some 1.27 million hours of lost productivity.

IRS Commissioner Werfel told the New York Times that the agency is making strides and is working to better deploy staff.

“I feel like there have been some critical advances and some important building blocks are in place,” Commissioner Werfel said.

Hiring Concerns Remain

The report from Advocate Collins notes that hiring continues to be a challenge for the IRS and that if changes are not made, the staffing shortages will “compound and pose significant threats to federal tax administration and taxpayer rights.”

Many of the 30,000 plus employees hired in fiscal year (FY) 2023, were to offset high rates of workforce attrition, as 18 percent of the IRS workforce is retirement eligible now, and 37 percent will be eligible for retirement in five years.

The report suggests shortening hiring times, launching targeted advertising for candidates, improving training for new hires, and implementing recruiting/retention bonuses.

“The reality is that federal pay is competitive for some jobs but not for others. In some job categories (e.g., revenue agents who audit large partnerships and corporations), the IRS seemingly has trouble hiring,” the report states.

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