The Internal Revenue Service provided updated details on where it stands in its processing of millions of tax returns in its backlog. 

Due to issues related to the pandemic and staffing limitations, the IRS began 2022 with a larger than usual inventory of paper tax returns and correspondence filed during 2021. The IRS took a number of steps to address this, and the agency is on track to complete processing of originally filed Form 1040 (individual tax returns without errors) received in 2021 this week. Business paper returns filed in 2021 will follow shortly after and they will continue to work on the 2021 individual tax returns that have processing issues or require additional information from the taxpayer.

As of June 10, the IRS had processed more than 4.5 million of the more than 4.7 million individual paper tax returns received in 2021. The IRS has also successfully processed the vast majority of tax returns filed this year: More than 143 million returns have been processed overall, with almost 98 million refunds worth more than $298 billion being issued. 

The IRS has worked through almost a million more returns to date than it had at this time last year. However, more than twice as many returns await processing compared to a typical year at this point in the calendar year as taxpayers file extensions, amended returns and a variety of business tax returns..

To work to address the unprocessed inventory by the end of this year, the IRS has taken aggressive, unprecedented steps to accelerate processing while maintaining accuracy. This effort included significant, ongoing overtime for staff throughout 2022, creating special teams of employees focused solely on processing aged inventory, and hiring of thousands of new workers and contractors to help with this ongoing effort.

"IRS employees have been working tirelessly to process these tax returns as quickly as possible and help people who are waiting on refunds or resolution of an account issue," said IRS Commissioner Chuck Rettig. "Completing the individual returns filed last year with no errors is a major milestone, but there is still work to do. We remain focused on doing everything possible to expedite processing of these tax returns, and we continue to add more people to this effort as our hiring efforts continue this summer."

If you have not yet filed your 2021 tax return, be sure to file your return electronically with direct deposit to avoid delays. People who use e-file avoid the delays facing those who file paper returns. E-filed returns with no errors are typically processed in 21 days.