CINCINNATI, OHIO — According to the IRS website, the agency currently has more than ten million unprocessed individual tax returns dating all the way back to 2021. It typically has less than a million unfiled returns heading into tax season. According to experts, these delays and other systemic problems at the IRS contribute to the perpetuation of poverty for marginalized groups, particularly Black Americans.
Yvonne Howard of Avondale stated that she has personally suffered as a result of the IRS’s processing delays.
The 64-year-old anticipated spending her retirement years in a quiet, modest existence in her Cincinnati Metropolitan Housing Authority (CMHA) apartment. It was supposed to be a welcome diversion from her hectic previous job and an opportunity for her to focus on her health. However, her plans were thwarted by a mix-up between her former employer and the IRS.
“I was actually in a state of panic,” Howard explained. “I’m afraid they’re going to take everything I own.”
Howard was slapped with an astronomical tax bill after the CMHA, a funder for her former employer, entered her name and income incorrectly on a 1099. Despite the fact that CMHA admitted to the error, the IRS informed Howard that she would be required to pay $29,000. This occurred in 2019; the IRS has yet to process her request to correct the bill.
“It’s the year 2022, and you’re still processing? Come on, now. I understand you’re short-staffed or whatever, but I believe this should not have been allowed to continue for this long,” Howard stated.
Howard stated that she has suffered two heart attacks as a result of the situation’s stress. She is now facing another $79,000 bill for her heart operation.
Howard’s savings account was less than $10,000 at the time of the mix-up. Now, she has a straightforward request for the IRS:
“Given the stress they’ve caused me and the medical bills I’ve racked up as a result of a lot of this stress,” Howard said, “I believe that between them and CMHA, there should be some sort of compensation.”
Howard’s attorney, David Wovrosh of the Legal Aid Society of Greater Cincinnati, stated that the delays are the result of a slew of systemic issues.
“The IRS has been operating on a shoestring budget for the better part of a decade,” Wovrosh said. “They have consistently relied on obsolete technology and are chronically understaffed. The pandemic has only exacerbated this.”
According to the Center on Budget and Policy Priorities, the IRS budget has decreased by roughly 20% since 2010. Its workforce has shrunk by roughly 30% over the same time period. As a result, Wovrosh stated, marginalized individuals are forced to wait for tax returns and tax credits intended to lift them out of poverty.
“They cannot afford a professional to assist them with this, which would likely speed up the process,” Wovrosh explained. “Unfortunately, we are once again confronted with a system in which people are supposed to receive tax credits in a timely manner in order to lift them above the poverty line. However, they are unable to do so due to a lack of time and resources.”
According to Wovrosh, race is a significant factor. He observes a disproportionate number of people of color struggling with the IRS in the Southwest Ohio area. He stated that 61% of the Legal Aid Society’s clients are African-American.
“Ensure that you read every document that comes from the Internal Revenue Service,” Howard advised. “Once the information is destroyed or incorrectly submitted, you will find yourself in the same situation as I am—waiting three years to learn about a mistake that has been corrected, but you have done nothing about it.”