IRS to Start 2023 Tax Season Stronger After 'Misery' for Tax Filers in 2022, Taxpayer Advocate Says

After another challenging year for the IRS, the agency may be primed for a better 2023 tax season. However, improvements may take time.
The National Taxpayer Advocate released its annual report to Congress on Wednesday, covering the biggest issues at the IRS from last year and making recommendations to fix these problems.
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"The bad news is that taxpayers and tax professionals experienced more misery in 2022," wrote National Taxpayer Advocate Erin Collins. "The good news is that, since the close of the 2022 filing season, the IRS has made considerable progress in reducing the volume of unprocessed returns and correspondence."
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The IRS began the year with a backlog of 4.7 million original individual returns, 3.2 million original business returns and 3.6 million amended returns. By the end of the year, that backlog had been reduced to roughly 400,000 individual returns and 1 million business returns.
The report finds that the IRS is making progress and is "poised to start the 2023 filing season in a stronger position."
The IRS has been struggling to keep up with paper-filed returns in recent years, but a new report suggests that the agency will be able to process returns more quickly in 2022. The report cites a "significant reduction" in the agency's inventory as the reason for this improvement.
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"I can see the light at the end of the tunnel," Collins wrote. "I'm just not sure how much further we have to travel before we see sunlight."
The report showed that the IRS has made progress in reducing its backlog, but Senator Collins warned that improvements won't happen immediately. The agency needs increased funding to boost staffing and new workers need to be trained.

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"The IRS needs to end the vicious cycle of paper backlogs," she said. "As employees are trained and report for duty, I expect we will start to see improvements in service, probably by the middle of 2023."
The report comes as House Republicans pass a bill to cut funding for the IRS. This follows a pledge from newly elected Speaker Kevin McCarthy to repeal the money approved by Congress last year.
The proposed bill would rescind tens of billions of dollars in funding for the agency over the next decade. However, the measure does not have the necessary support from the Democratic-controlled Senate or the White House in order to be enacted.