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January 14, 2015

Cuts to IRS could slow tax refunds

Commissioner blames budget cuts

Tax refunds are likely to take longer this year, according to a Forbes report on an email IRS Commissioner Josh Koskinen sent to employees on Tuesday warning of the effects of budget cuts.

“There is no way around the severity of these budget cuts without taking some difficult steps,” said the commissioner’s email, written under the subject line “Budget update: Tough choices.”

“As I have said before, this year we are looking at a situation where realistically we have no choice but to do less with less,” said the email posted on ABC’s website.

The IRS is operating with its lowest budget since 1998 when inflation is considered, according to Koskinen.

In recent years, the IRS was targeted by Republicans who accused the agency of unfairly scrutinizing conservative groups.

What this means for taxpayers is less protection against identity theft, fewer audits and what many people might care most about - slower refund checks, analysts said.

“People who file paper tax returns could wait an extra week - or possibly longer - to see their refund,” the email said. And if people have questions about their taxes and need to contact the IRS by phone, the response time could be even slower than it was before.

IRS employees might be impacted as well. The commissioner warned that the agency was still operating under a budget shortfall and might be forced to shut down for two days later in the year, forcing furloughs.

“The effect of these cuts will hurt taxpayers and our tax system,” said Koskinen. “I know you will continue to do your best even as we are forced to do less than all of us want.”