The IRS is now opening mail within normal timeframes. The IRS has also made significant progress in processing returns. As of December 25, 2020, we had 6.9 million individual tax returns in the processing pipeline. For refunds that could not be issued in 2020 because the tax return is being corrected, reviewed or awaiting correspondence from a taxpayer, the refund will be issued as a paper check in 2021 per our normal processes. Taxpayers are encouraged to continue to check Where’s My Refund for their personalized refund status.

How long you may have to wait: It depends on where you sent your tax return and where it is in the process. In some locations, we are caught up or almost caught up. In other locations we are processing returns we received over the summer due to the extended July 15 tax filing due date and, in some cases, are processing tax returns dated as early as April 15, 2020. However, we are rerouting tax returns and taxpayer correspondence from locations that are behind to locations where more staff is available, and we are taking other actions to minimize any delays. Tax returns are opened in the order received. As the return is processed, it may be delayed because it has a mistake, is missing information, or there is suspected identity theft or fraud. If we can fix it without contacting you, we will. If we need more information or need you to verify that it was you who sent the tax return, we will write you a letter. The resolution of these issues depends on how quickly and accurately you respond, and the IRS staff trained and working under social distancing requirements to complete the processing of your return.

What you should do: Other than responding to any requests for information promptly, there’s no action you can take. We’re working hard to get through the backlog. Please don’t file a second tax return or contact the IRS about the status of your return.

LATEST NOTICE DELAYS — 

Because of the COVID-19 shutdown, we experienced a backlog in mailing notices. To save time and money, we didn’t generate new ones and many notices were mailed with past due payment or response dates.

We included a Notice 1052, Important! You Have More Time to Make Your Payment, as an insert. The insert provided new or updated pay or response dates. Due to an error, some notices were sent without the insert.  If you were among those who didn’t get the Notice 1052, you were sent a Letter 544 on August 7, 2020, with the appropriate information.

What you should do: Please read the insert carefully. It explains why the notice was delayed and provides a new date to pay or respond. If you got the notice, you should:

• Review the last page of the insert to determine if there is a new due date
• Do nothing with the notice if you’ve already taken steps to resolve the issue
• Contact us using the phone number on the notice if you have questions. Keep in mind that phone lines are extremely busy as the IRS resumes operations

If the notice was about a balance due and you’re unable to pay, consider payment options to avoid getting additional penalties and interest.

IRS is now sending 500 series balance due notices:

Although the IRS continued to issue most agency notices, the 500 series were suspended temporarily due to COVID-19. Some taxpayers have started to receive the updated 500 series notices with current issuance and payment dates.

The 500 series includes three different types of notices that alert taxpayers about varying stages of nonpayment — the CP501, the CP503 and the CP504.

Taxpayers who are unable to pay are encouraged to consider available payment options as penalties and interest continue to accrue. Taxpayers in this situation are particularly encouraged to first review the Online Payment Agreement tool, which offers an easy way to set up a payment plan.

Penalty relief due to reasonable cause: If you were affected by the pandemic or other circumstances, we may be able to remove or reduce some penalties due to reasonable cause, but only if you tried to comply with the tax law but were unable to due to facts and circumstances beyond your control. If this applies to you and you have the necessary documentation to support your claim, call the toll-free number on your notice to request penalty relief due to reasonable cause.

See more information on reasonable cause relief.

Our National Distribution Center is open with reduced staffing. We’re processing requests as quickly as we can and will ship forms and publications as they’re available.

What you should do: If you’ve already requested IRS forms or publications, do not submit a second request.

You may place new orders online at Order Forms & Publications. If you don’t have access to the internet, call 800-829-3676 to request forms by mail.

We’re processing applications for recognition of exemption for tax-exempt organizations and continue to work rulings and determinations for employee plans and closing agreements for municipal issuers.

We’re processing payments for Forms 8038-CP, Return for Credit Payments to Issuers of Qualified Bonds, on a priority basis.

Due to processing center reduced staffing, we’re working tax exemption applications and filed information returns (for example, Form 990 series) but the paper filed information returns are delayed in uploading to the Tax Exempt Organization Search tool on IRS.gov. The approved determination letters and electronic return filings are being uploaded to the Tax-Exempt Organization Search tool.

We’ll temporarily allow digital signatures on certain forms that can’t be filed electronically.

What you should do: You can send us the following forms with digital signatures if they are postmarked from January 1, 2021 through June 30, 2021:

• Form 3115, Application for Change in Accounting Method;
• Form 8832, Entity Classification Election;
• Form 8802, Application for U.S. Residency Certification;
• Form 1066, U.S. Income Tax Return for Real Estate Mortgage Investment Conduit;
• Form 706, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
• Form 706-NA, U.S. Estate (and Generation-Skipping Transfer) Tax Return;
• Form 709, U.S. Gift (and Generation-Skipping Transfer) Tax Return;
• Form 1120-ND, Return for Nuclear Decommissioning Funds and Certain Related Persons;
• Form 1120-RIC, U.S. Income Tax Return for Regulated Investment Companies;
• Form 1120-C, U.S. Income Tax Return for Cooperative Associations;
• Form 1120-REIT, U.S. Income Tax Return for Real Estate Investment Trusts;
• Form 1120-L, U.S. Life Insurance Company Income Tax Return;
• Form 1120-PC, U.S. Property and Casualty Insurance Company Income Tax Return;
• Form 1128, Application to Adopt, Change or Retain a Tax Year;
• Form 3520, Annual Return to Report Transactions with Foreign Trusts and Receipt of Certain Foreign Gifts;
• Form 3520-A, Annual Information Return of Foreign Trust with a U.S. Owner;
• Form 8453 series, Form 8878 series, and Form 8879 series regarding IRS e-file Signature Authorization Forms; and
• Form 8038 series, pertaining to tax-exempt bonds.

For more information, see IRS approves temporary use of e-signatures for certain forms.

If you were an employer who reduced your tax deposits because you planned to claim the sick and family leave credits, or employee retention credit in the second quarter of 2020, you may have received a notice stating there was a Failure to Deposit Penalty for Form 941.

Why you received this: When you reported the schedule of liabilities on Form 941, the liabilities didn’t match the reduction in deposits for every pay date. When this happened, you received a Failure to Deposit Penalty on the difference.

For more information, see Failure to deposit penalties on some employers claiming new tax credits.