 Internal Revenue Service IRS Tax News. IRS releases fiscal year 2021 data book describing agencies' activities. As if we need it. We know how the IRS spent their days last year. Doing the same thing they do every year. Taking our money. Honestly, it's like asking the school bully how he spent his lunch break. As he walks past, pockets bulging, jingling with change, sculpting down five of the most expensive desserts on the cafeteria menu. Hey, you didn't earn the right to those peanut butter bars. IR 2022-111, May 26, 2022, Washington. The Internal Revenue Service today issued the data book. There's a link to the data book here. It's detailing the agency's activities during fiscal year 2021. That's October 1, 2020 to September 30, 2021. In quote, during fiscal year 2021, the COVID-19 pandemic continued to present the IRS with some of the greatest challenges in our agency's history. And the way our employees responded illustrates the significant role that the IRS plays in the overall health of our country. In quote, said IRS Commissioner Chuck Reddick. So obviously COVID-19 had a lot of implications or a lot of impacts. And when there was government responses, a lot of them are going through changes to the IRS or the IRS has to deal with. So you might agree or disagree with many of the laws that were put in place. But if you think about the IRS as simply an agency that's not making the law, but dealing with the law that is being made, then obviously they had to deal with a lot of laws and regulations and changes, which is not in the norm of what the IRS is kind of built to do. Typically, what we would kind of like to have is the tax code to be somewhat static from year to year so that we can anticipate the process and we can make projections and think about what we're going to have some knowledge about what's going to happen in the future. Obviously, as the laws change a lot, that then puts a lot of kind of uncertainty into the system. And obviously the IRS is not really equipped to deal with those big rapid changes as well. So I'm sure it was quite stressful for the IRS. So quote, the IRS was called on to provide economic relief during this nation's crisis, while also fulfilling our agency's core responsibilities of tax administration. IRS employees entered Congress call to deliver two or more rounds of economic impact payments and also implemented changes to the Earned Income Tax Credit, the Child Tax Credit, and other refundable credits as part of the American Rescue Plan. So again, obviously those were huge changes. So now they're just sending out checks with the economic impact payments, trying to work that completely new thing into the tax code. It's a prepayment, which means you've got these estimates that are going to work in place, which as we've seen, there's always going to be problems when you try to make an estimate in a prepayment kind of situation. The Earned Income Tax Credit is already one of the most complex credits we have. And so when they make all these other changes, allowing prior year income and changing the rates and whatnot and the levels and the maxes is confusing. And of course, the Child Tax Credit, another one where you're now doing this prepayment kind of thing, which of course leads to points where you're going to make problems or make errors because you're making estimates for the prepayment. So all of that was a lot of big change. So the breadth of these missions has strengthened my belief that a fully functioning IRS is critical to the success of our nation. Now, again, you might agree or disagree with the IRS's role in terms of, should they be doing all these changes? Would it help to be more consistent and less kind of trying to reactive or reactive to all the things that are happening? And you can say yes or no on that. But obviously, if you think about the IRS as not the person that's making the law, but the one reacting to it, then they are of course reacting or having to implement a lot of changes. So in addition to describing work performed during the pandemic, the IRS data book for fiscal year 2021 comprises 33 tables describing a wide variety of IRS activities from returns processed, revenue collected and refunds issued to the number of examinations conducted and the amount of additional tax recommended as well as budget and personal information. The data book provides a point in time estimates of IRS activities as of September 2021. So if you honestly, if you want to get an idea of like what is going on in a particular country at a particular time, for example, looking at how the tax is being collected is often quite telling. I mean, just look at a no taxation without representation, right? Tax plays a lot of roles and a lot of different changes over time. So it's actually quite interesting to look at what is happening with the tax code can be quite telling if you look at it at a time period of change such as one where there's a crisis like the COVID-19 and, you know, dig into that. So there's a lengthener discussion of recent data was also released today. There's a link to that here as well. As the pandemic continued in 2021, the IRS delivered tax administration relief to millions of taxpayers providing financial assistance for Americans. The American Rescue Plan Act of 2021 authorized additional rounds of stimulus payments. That's the EIP 3, which was signed into law on March 11, 2021. The IRS started issuing checks that very next day, that very next day, March 12, 2021, providing immediate help to people across the country. The 2020 recovery rebate credits allowed individuals who did not receive their first or second round EIPs, Economic Impact Payment Stimulus Checks, in other words, or received less than the amounts they were eligible for to claim the credits when they filed their 2020 tax return. Advanced Child Tax Credit and online support, the American Rescue Plan continued to implement change, allowing up to half of the tax year 2021 Child Tax Credits to be dispersed as advanced payments to eligible families from July through December. So this is another one where the big change here, they've made a lot of changes to basically the child tax credit itself and then took half of it and tried to make it an advanced payment. Anytime you're making an advanced payment, you're going to do estimates. Anytime you're doing estimates, you're going to have errors. That's just the nature of the way things work. So obviously that's a big task to take on. As a result, during the second half of 2021, more than 37 million families covering more than 61 million qualifying children received more than 93 billion in advanced CTC payments. So again, you could kind of argue and think, well, is that the best way to handle it? Was that the best thing to do from a legislative standpoint? I mean, I don't know, you can argue, but in terms of just doing it once they've made the call, it's clearly a difficult task. So in addition to COVID-19 related tax relief, the IRS implemented vital online tools to support the 2021 advanced CTC payments and reduce child poverty. So these online tools include, you got the child tax credit non-filer signup tool which helped eligible families who were not required to file tax returns register for the monthly payments. So obviously as you change a lot of these things, especially that they're for low income individuals, the child tax credit and advanced payments are confusing. The earned income tax credit is confusing. The advanced payments for things like the health insurance in general, if you're on the marketplace, is confusing. The advanced payments for the stimulus payments are confusing and they're typically going to cause more confusion to the lower income tax payers who oftentimes may not have been required to file in the first place and or if they did file, they had a pretty easy return which has now become quite complex. So that means that they would be nice if you could give them software because otherwise they'd have to go to a tax professional to get the help that they would probably need to fill out the tax return because it's kind of too complex to do by paper these days. So somehow they kind of strangled in the online tax providers, the tax software providers to help to give them tools to help give them the tax software, which is nice. So that's all interesting. So the child tax credit non-filer signup tool which helped eligible families who were not required to file tax returns register for monthly payments. So this is for people that didn't file a tax return and didn't want to file a tax return. It was too complex. They gave this other tool to give just the information for the credit which I'm sure caused a lot of problems and confusions but it was certainly a task to be undertaken that was quite significant or big. The advanced child tax credit eligibility assistant which helped families verify whether they qualify for an advanced child tax credit. So now they're trying to tell people what they're doing with this complicated advanced child tax credit and then the child tax credit update portal to enable families to verify their eligibility, update their bank account information and mailing address and provide other information to the IRS. So obviously if there's errors as we see that there could quite be likely be errors with these advanced child tax credits they needed tools to deal with that. So tax administration during COVID-19 at the same time as providing various pandemic related tax relief measures to Americans the agency continued its everyday operations processing more than 261 million tax returns and collecting more than $4.1 trillion in federal taxes during the fiscal year about 96% of federal revenue from all sources. That's the IRS. That's what they do. $14.1 trillion. How much did we spend last year? Man, seems like we spent more than... Well anyway, collection revenue overall net revenue through enforcement by the collection function equal almost 60 billion an increase of 54% over the prior year as part of its collection activities the IRS saw an increase in the use of payment plans almost 2.4 million taxpayers established new payment plans that's installment plans that's kind of not good because that means that people aren't able to pay their taxes and they're setting up a payment plan like a loan to basically pay it off generally. So with the IRS during fiscal year 2021 that's an increase of 29% which kind of makes sense considering so many people had changed their employment statuses and whatnot during that time period so that's compared to fiscal year 2020 so hopefully that turns around that's something to keep an eye on. Furthermore, IRS collected nearly 13.7 billion through installment agreements in 2021 up 9% from the prior fiscal year. So people are going into into debt on their tax bills here. So anyways, possibly that would be one of the... Okay, other IRS activities under the IRS comprehensive taxpayer attitude survey the most recent findings were that most taxpayers still agree that cheating on their income taxes is not at all acceptable. So yeah, I mean, it'd be nice if... And I think obviously if you got, you know the heart of the country here no taxation without representation and whatnot if you feel like the taxes are actually the money is actually doing good like paying for the military for example so that we don't... That's kind of what it was for if it's going towards something useful, I think most people are comfortable with the taxes usually when the taxes are seen to be not going somewhere useful or not being applied according to what the people think it should be applied to or they don't think the system is operating properly that's usually when people start saying, hey, something's wrong and whatnot. So any case, that's a good sign for the sentiment of the country. Was that a pull? The most recent findings were that most taxpayers still agree that cheating. I wonder where's the data on how they came to that assessment? I wonder what kind of polling work they did but in the case you'll find many fascinating statistics with the data book said Reddit but there's more to the IRS the numbers and graphs IRS employees are dedicated to the mission and our agency is made up of people who give back to their communities and help one another. Our employees provide significant support for those devastated by hurricanes wildfires and other national disasters across the nation. They did amazing work in their communities to help those impacted by COVID-19 and quote man, everybody that works for the IRS is like a saint. They're all like Mother Teresa's over there taking everyone's money. But any case you could check out the data book there's a link to that here there'll be a link to this in the description.