Business
IRS Reports Increased Tax Refunds on Tax Day
On Tax Day, the Internal Revenue Service (IRS) has announced a rise in average income tax refunds, with taxpayers receiving an average of $3,011, a $123 increase from the previous year. The agency revealed that two out of three taxpayers are expecting refunds this season.
Treasury Secretary Janet Yellen emphasized the customer service enhancements implemented by the IRS following the passage of Democrats’ Inflation Reduction Act, which allocated significant funding to the agency. The improvements aim to expedite refund processing, in some cases providing refunds in just over a week.
Since the start of the tax season, the IRS has issued over $200 billion in refunds by early April, with 101 million tax returns already processed. Noteworthy initiatives include decreasing phone wait times to three minutes from an average of 28 minutes in the previous year, saving taxpayers 1.4 million hours in hold time.
Furthermore, the updated ‘Where’s My Refund’ tool offers more detailed information on refund status in easily understandable language, with 31 million views online.
IRS Commissioner Daniel Werfel highlighted the historic improvements in taxpayer service levels and the agency’s recovery from challenging years in the past decade.
The IRS aspired to deliver better service to all Americans, streamline the tax filing process, combat tax evasion among complex filers, and increase revenue collection for the U.S. Treasury.
One of the recent initiatives introduced by the IRS is the Direct File program, a free electronic tax return filing system available to taxpayers in 12 states with simple W-2 forms and standard deductions. The successful implementation and expansion of Direct File could revolutionize tax filing for the general public.
However, despite the initial allocation of $80 billion in funding through the Inflation Reduction Act, House Republicans have managed to reduce IRS funding by $1.4 billion in a recent congressional package. There are concerns that further funding cuts could impact revenue collection, as highlighted by the Congressional Budget Office‘s analysis predicting deficits from IRS budget reductions.
