TIGTA Interim Report 2020-46-041 — 2020 Filing Season: COVID-19 Shutdown Effects on IRS Operations

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Summary

An interim audit report of the Treasury Inspector General for Tax Administration, Reference Number 2020-46-041, issued June 30, 2020, on the effect of the COVID-19 shutdown on IRS tax processing and customer service operations during the 2020 Filing Season. The report states the IRS began issuing Economic Impact Payments on April 10, 2020, 14 days after passage of the CARES Act, and had issued more than 157 million payments totaling more than $264 billion as of May 21, 2020, of which about 98 percent were computed correctly and 1.2 million went to prisoners and deceased individuals. It reports that as of May 30, 2020 the IRS had received 7,789 Forms 7200 and processed 2,410, with refunds over $50 million. On backlogs it cites 10.4 million pieces of mail received during the closure and 48 of 105 toll-free lines still closed. The report makes no recommendations.

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Interim Results of the 2020 Filing Season:  
Effect of COVID-19 Shutdown on Tax Processing and 
Customer Service Operations and Assessment of Efforts 
to Implement Legislative Provisions 
 
 
June 30, 2020 
 
Reference Number:  2020-46-041 
 
 
 
 
 
 
This report has cleared the Treasury Inspector General for Tax Administration disclosure review process and information 
determined to be restricted from public release has been redacted from this document. 
Redaction Legend: 
2 = Law Enforcement Techniques/Procedures and Guidelines for Law Enforcement Investigations or Prosecutions 
 
To report fraud, waste, or abuse, please call us at 1-800-366-4484 
TIGTACommunications@tigta.treas.gov    |   www.treasury.gov/tigta   |   202-622-6500 
TREASURY INSPECTOR GENERAL FOR TAX ADMINISTRATION 

HIGHLIGHTS:  Interim Results of the 2020 Filing Season:  
Effect of COVID-19 Shutdown on Tax Processing and Customer Service 
Operations and Assessment of Efforts to Implement Legislative 
Provisions 
 
Final Audit Report issued on June 30, 2020 
Reference Number 2020-46-041 
 
 
Why TIGTA Did This Audit 
This audit was initiated to provide 
selected information related to 
the impact of the Coronavirus 
Disease 2019 (COVID-19) on the 
2020 Filing Season.  The overall 
objective of this review was to 
evaluate whether the IRS timely 
and accurately processed 
individual paper and 
electronically filed tax returns 
during the 2020 Filing Season.  
TIGTA plans to issue the final 
results of our analysis later in 
Calendar Year 2020. 
Impact on Taxpayers 
The 2020 Filing Season is unlike 
any other because the IRS had to 
take unprecedented and drastic 
actions to address COVID-19 to 
protect the health and safety of 
its employees and the taxpaying 
public.  These actions included 
closing Taxpayer Assistance 
Centers, Tax Processing Centers, 
and offices nationwide.  In 
addition, on March 20, 2020, the 
Department of the Treasury 
extended the Federal income tax 
filing due date from April 15, 
2020, to July 15, 2020. 
What TIGTA Found 
Significant coordination and efforts were taken by the IRS to 
expedite its analysis and reprogramming of systems and to educate 
individuals on the Economic Impact Payment (EIP).  The IRS began 
issuing EIPs on April 10, 2020, just 14 days after the passage of the 
CARES Act.  As a result of these efforts, the IRS has issued more than 
157 million payments totaling more than $264 billion as of 
May 21, 2020. 
TIGTA found that the IRS correctly computed the payment amount 
for approximately 98 percent of the more than 157 million payments 
issued as of May 21, 2020; however, some payments were erroneous.  
The IRS issued 1.2 million payments (less than 1 percent) to prisoners 
and deceased individuals as of this same period. 
The IRS initiated an education campaign to promote the availability 
of advanced tax credits for employers.  To enable employers to 
request an advance, the IRS developed Form 7200, Advance Payment 
of Employer Credits Due to COVID-19, and developed a process to 
enable employers to submit these requests via a dedicated E-fax line.  
In addition, the IRS is coordinating with the Small Business 
Administration *************************2****************************** 
**********************************2************************************* 
*****************2***************.  As of May 30, 2020, the IRS received 
7,789 Forms 7200, and processed 2,410 Forms 7200, with refunds 
totaling more than $50 million. 
In response to the public health emergency, the IRS closed its four 
Tax Processing Centers.  The majority of work at these Tax Processing 
Centers is performed onsite and is not conducive to telework.  As of 
May 20, 2020, the IRS estimates that 10.4 million pieces of mail were 
received during the closure.  As of the week ending May 23, 2020, the 
IRS estimates that 10 million paper individual tax returns and 
6.6 million paper business tax returns need to be processed.  In 
addition to unopened mail, the IRS had more than 1.7 million tax 
returns in its Error Resolution inventory as of this same period.  The 
IRS had 2.5 million cases in its Accounts Management inventory as of 
March 14, 2020, and has nearly 1.6 million returns in its fraud 
program inventories as of the week ending May 23, 2020. 
When the IRS closed its offices nationwide, it ceased operations on 
its toll-free telephone lines and closed its Taxpayer Assistance 
Centers.  As of May 20, 2020, 48 of the 105 toll-free lines remained 
closed, and all of the Taxpayer Assistance Centers remain closed.  In 
addition, 10,792 (98 percent) of the 11,014 Volunteer Income Tax 
Assistance/Tax Counseling for the Elderly partner sites remain closed 
as of May 24, 2020. 
What TIGTA Recommended 
This report was prepared to provide interim information only.  
Therefore, no recommendations were made in this report. 

U.S. DEPARTMENT OF THE TREASURY 
WASHINGTON, D.C.  20220 
TREASURY INSPECTOR GENERAL 
FOR TAX ADMINISTRATION 
 
 
 
 
June 30, 2020 
 
 
MEMORANDUM FOR: COMMISSIONER OF INTERNAL REVENUE 
 
FROM: 
Michael E. McKenney 
 
Deputy Inspector General for Audit 
 
SUBJECT: 
Final Audit Report – Interim Results of the 2020 Filing Season:  
Effect of COVID-19 Shutdown on Tax Processing and Customer Service 
Operations and Assessment of Efforts to Implement Legislative 
Provisions (Audit # 202040631) 
 
This report presents the results of our review to evaluate whether the Internal Revenue Service 
(IRS) timely and accurately processed individual paper and electronically filed tax returns during 
the 2020 Filing Season.  This review is part of our Fiscal Year 2020 discretionary audit work and 
addresses the major management and performance challenge of Implementing Tax Law 
Changes.  As part of our Fiscal Year 2020 audit work, we are conducting several ongoing audits 
that are related to specific issues in this report.  We will continue to provide IRS management 
with information on any areas of immediate concern throughout our audit process. 
This report was prepared to provide information only.  Therefore, we made no 
recommendations in the report.  However, we provided IRS management officials with an 
advance copy of this report for review and comment prior to issuance. 
Copies of this report are also being sent to the IRS managers affected by the report information.  
If you have any questions, please contact me or Russell P. Martin, Assistant Inspector General for 
Audit (Returns Processing and Account Services). 
 

 
 
Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
Processing and Customer Service Operations and Assessment of Efforts to 
Implement Legislative Provisions 
Table of Contents 
Background .....................................................................................................................................Page 1 
Results of Review .......................................................................................................................Page 3 
Economic Impact Payments .............................................................................................Page 3 
Advance Tax Credits for Employers...............................................................................Page 11 
Tax Processing Center Closures Have Resulted in 
Significant Backlogs ............................................................................................................Page 12 
Closures Are Affecting Efforts to Provide Quality 
Customer Service .................................................................................................................Page 15 
More Than a Million Tax Returns Identified and Held As 
Potentially Fraudulent or With Erroneous Refundable 
Credit Claims Remain to Be Worked ............................................................................Page 18 
Appendices 
Appendix I – Detailed Objective, Scope, and Methodology ................................Page 20 
Appendix II – High-Level Process Flow of IRS Documents ..................................Page 22 
Appendix III – Glossary of Terms....................................................................................Page 23 
Appendix IV – Abbreviations ...........................................................................................Page. 25 
 
 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Background 
Due to Coronavirus Disease 2019 (COVID-19), the 2020 Filing Season1 has been unlike any 
other.  The Internal Revenue Service (IRS) has taken unprecedented and drastic actions to 
protect the health and safety of its employees and the taxpaying public.  These actions have 
included closing Taxpayer Assistance Centers (TAC), Tax Processing Centers, and other offices 
nationwide.  Specifically, employees were directed to evacuate their work sites, and those who 
were approved to telework started working from home (or an alternate location).  Employees 
who were not yet approved but were able to telework had to complete training, sign 
agreements, and obtain the necessary equipment to enable teleworking.  The remaining 
employees were put on weather and safety leave. 
Along with protecting the safety of its workers, 
actions were also taken to assist taxpayers facing 
the challenges of COVID-19.  For example, on 
March 25, 2020, the IRS unveiled a new People First 
Initiative, which included a sweeping series of steps 
to assist taxpayers by providing relief on a variety of issues ranging from adjusting or 
suspending key IRS compliance programs to easing payment guidelines.  The IRS also 
postponed compliance actions by suspending liens and levies, suspending passport 
certifications of seriously delinquent taxpayers, not referring new delinquent accounts to Private 
Debt Collection, and delaying new field, office, or correspondence examinations.2  This relief is 
through July 15, 2020. 
Furthermore, on March 20, 2020, the Department of the Treasury extended the Federal income 
tax filing due date from April 15, 2020, to July 15, 2020.  Taxpayers were also permitted to defer 
Federal income tax payments due on April 15, 2020, to July 15, 2020, without penalties and 
interest.  Finally, legislation was enacted to help businesses and individuals respond to the 
pandemic: 
• 
Families First Cornavirus Response Act,3 signed into law on March 18, 2020, provides 
businesses with tax credits to cover certain costs of providing employees with paid sick 
leave and expanded family and medical leave for reasons related to COVID-19, from 
April 1, 2020, through December 31, 2020.  Eligible employers can claim these credits on 
their Federal employment tax returns (e.g., Form 941, Employer's Quarterly Federal Tax 
Return) or an employer can benefit more quickly by reducing their Federal employment 
tax deposits.  For those employers where there are insufficient Federal employment taxes 
to cover the amount of the employer’s credit, the employer may request an advance 
payment of the credits from the IRS by submitting Form 7200, Advance Payment of 
Employer Credits Due to COVID-19.  
• 
Coronavirus Aid, Relief, and Economic Security (CARES) Act,4 signed into law on 
March 27, 2020, is the largest economic rescue package in U.S. history and included a 
                                                 
1 See Appendix III for a glossary of terms. 
2 The IRS stated that it may start new examinations where deemed necessary to protect the Government's interest in 
preserving the applicable statute of limitations. 
3 Pub. L. No. 116-127. 
4 Pub. L. No. 116-136, 134 Stat. 281. 

 
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number of provisions that have a significant impact on the IRS and Federal tax 
administration.  Specifically, the CARES Act contains numerous tax-related provisions 
affecting individuals and businesses and appropriates more than $750 million in 
additional funding to the IRS to administer and oversee these provisions.  Figure 1 
provides higlights of CARES Act provisions. 
Figure 1:  Highlights of CARES Act Provisions 
 
Source: TIGTA Analysis of CARES Act. 
As a result of the closure actions taken on the part of the IRS as well as the enactment of 
extensive legislation, the IRS will be faced with a number of significant challenges in regards to 
the COVID-19 pandemic.  For example: 
• 
Providing Tax Relief to Offset Economic Hardship.  The IRS must implement many 
tax provisions intended to provide relief to those experiencing financial hardship.  As the 
IRS implements the individual and business tax relief provisions, it will face challenges to 
ensure that only eligible taxpayers are receiving financial relief and that the amount of 
relief is correct.  The IRS will also need to recover improper payments made to ineligible 
taxpayers. 
• 
Continuity of Operations.  The IRS has not been able to perform many of its essential 
functions as a result of the pandemic.  The IRS closed most of its offices and Tax 
Processing Centers and extended the deadline for filing tax returns in response to the 
pandemic.  In addition, before the full impact of COVID-19 was felt, taxpayers were 
already experiencing lower levels of taxpayer service.  As the IRS slowly reopens and 
begins to address significant backlogs in paper return filings, payments, correspondence, 
error resolution, and fraud detection cases, it must continually assess the personal safety 
of its workers.  This may necessitate the IRS to continue offering telework flexibilities, 
place limits on the number of staff allowed in offices, and increase the procurement of 
personal protective equipment.  Trying to balance restarting operations with employee 
safety will challenge the IRS to provide quality customer service, deliver the filing season, 
and enforce compliance with tax laws.   
TIGTA has ongoing and planned oversight activities to help ensure that eligible taxpayers are 
receiving timely relief from financial hardship caused by the COVID-19 pandemic and that the 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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IRS quickly identifies control weaknesses to prevent Federal Government funds from being 
wasted.   
Results of Review 
This report presents the interim results of our assessment of the IRS’s 2020 Filing Season and 
provides preliminary results of our review of the IRS’s issuance of Economic Impact Payments 
(EIP), efforts to implement individual and business tax provisions included in relief legislation, 
and on its ability to process tax returns and provide quality customer service.  We plan to report 
on the final results of our assessment early next fiscal year.   
For the purpose of this report, the EIP figures presented reflect payments issued as of the time 
frame noted.  These figures do not reflect direct deposit payments that may have been rejected 
and not converted to a paper check, paper checks returned as undelivered, or payments that 
were voluntariliy returned by recipients.  Our continued assessment will include a reconcilation 
of the EIPs issued and we will provide periodic reporting of these results.  However, the actual 
time frame to complete this reconciliation is contingent on the IRS’s processing of unopened 
mail, which includes undelivered and returned payments.  As we note later in this report, the IRS 
has a significant backlog of unopened mail that needs to be processed.  
Economic Impact Payments  
Significant coordination and efforts were taken by the IRS to expedite its analysis and 
reprogramming of systems and to educate individuals on the EIP.  Impressively, the IRS began 
issuing EIPs on April 10, 2020, just 14 days after the passage of the CARES Act, which was 
enacted at the same time the IRS was closing its facilities in response to COVID-19.  Efforts 
included: 
• 
Establishing a dedicated webpage on IRS.gov (www.IRS.gov/coronavirus/ 
economic-impact-payments) to provide updated information related to the 
issuance of the EIP, including a continually evolving list of Frequently Asked 
Questions – In addition, the IRS developed an online tool “Get My Payment” that 
provides taxpayers with the ability to check the status of their EIP payment and submit 
bank information for taxpayer accounts that are missing that information.  To assist 
taxpayers who are eligible to receive an EIP but do not have a Federal tax return filing 
requirement, the IRS partnered with the Free File Alliance to develop the Non-Filers: 
Enter Payment Info Here tool.  This tool enables these individuals to quickly file a short 
tax return that contains the information the IRS needs to issue their EIP for free.   
• 
Coordinating with other Federal agencies to obtain program data that could be 
used to automatically send an EIP to individuals who receive benefits from these 
agencies and do not regularly interact with the IRS – For example, the IRS worked 
with the Bureau of the Fiscal Service (BFS),5 the Social Security Administration, and the 
Department of Veterans Affairs to identify beneficiary recipients along with their direct 
deposit account numbers, if available, for use in systemically issuing the EIP without the 
beneficiary having to file a short-form tax return. 
                                                 
5 Agency of the U.S. Department of the Treasury that issues payments on behalf of the IRS. 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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• 
Completing extensive computer programming and testing necessary to issue the 
EIPs – Despite office closures and employees needing to work remotely, the IRS was able 
to complete the extensive programming and testing necessary to begin issuing EIPs.  
This included developing computer programming requirements to identify eligible 
individuals, compute their EIP amount, as well as modify the Master File to capture 
information related to the issuance of the EIP in each individual’s tax account, including 
information provided through the “Get My Payment” tool.      
As a result of its efforts, the IRS issued more than 81.4 million payments totaling more than 
$147.6 billion on April 10, 2020.  As of May 21, 2020, the IRS issued more than 157 million 
payments totaling more than $264 billion.  As required by the CARES Act, the IRS also 
established processes to issue a notice to each EIP recipient providing the amount of the 
payment and the method used to send the payment 
(e.g., direct deposit, paper check, or prepaid debit card).  
Similar to our assessment of prior IRS efforts to 
implement stimulus payment legislation, we developed 
an approach to provide results to the IRS quickly to 
allow the IRS to make timely programming corrections.  
Specifically, we used the payment criteria included in 
the CARES Act to develop a systemic program that enabled us to independently compute an EIP 
amount for all eligible taxpayers.  We then used these data to compare our amount of EIP to 
what the IRS payment file reflected for each individual.  Our review of the more than 157 million 
EIPs issued as of May 21, 2020, found that the IRS correctly computed the EIP amount for 
98 percent (154 million) of these payments.  We are continuing to work with the IRS to 
determine whether the remaining 3.1 million payments (2 percent) were computed correctly and 
will monitor the IRS’s efforts to address payments that are incorrect.  Figure 2 shows the 
percentage of EIPs issued as of May 21, 2020, that were computed correctly. 
Figure 2:  Accuracy of the Economic Impact 
Payment Amount as of May 21, 2020 
 
Source:  TIGTA analysis of EIPs issued as of May 21, 2020. 
EIP payments were issued to prisoners and deceased individuals   
As part of our initial assessment of the 81.4 million payments issued on April 10, 2020, we 
identified payments that were sent to individuals who were prisoners or deceased.  We notified 
IRS management of our concerns with the issuance of payments to prisoners on April 14, 2020, 
98 percent of EIPs issued as of 
May  21, 2020, were computed 
correctly. 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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and to deceased individuals on April 15, 2020, in an e-mail alert.  In response, IRS management 
noted that payments to these populations of individuals were allowed because the CARES Act 
does not prohibit them from receiving a payment.  However, the IRS subsequently changed its 
position, noting that individuals who are prisoners or deceased are not entitled to an EIP.  As an 
interim measure, the IRS provided the BFS with a file that contained the Taxpayer Identification 
Numbers of prisoners and deceased individuals and requested that the BFS remove these 
individuals from payment files.  This approach was applied to the May 1, 2020, and May 8, 2020, 
payment files.   
Subsequent to these payments being processed, we were alerted that the BFS may have 
incorrectly marked payments as having a child support offset when in fact the payment was held 
because the individual was a prisoner or deceased.  We notified IRS management of our 
concerns and provided the IRS with the results of our analysis that identified deceased 
individuals who do not have a pattern of having prior child support offsets, but the BFS marked 
the EIP as being offset.  Our analysis identified 185,380 deceased individuals with offsets 
totaling over $257 million with these characteristics.     
IRS management informed us that the BFS used a pseudo offset to identify EIPs that the BFS 
stopped because the individual is a prisoner or deceased.  Although the payment is marked as 
being offset, the BFS provided additional information that the IRS can use to identify that the 
payment was stopped because the individual was a prisoner or deceased. 
We are concerned that marking these payments as having the EIP offset can result in taxpayer 
confusion.  In addition, the spouse of a prisoner or deceased individual is entitled to their 
portion of the EIP, but the BFS incorrectly stopped the entire payment.  The BFS provided the 
IRS with the Taxpayer Identification Numbers of the prisoners and deceased individuals where 
the BFS stopped the EIP.  IRS management informed us that they are working to correct these 
accounts and issue the EIPs to the affected spouse where appropriate.  We will continue to 
monitor the IRS’s efforts to ensure that these individuals’ tax accounts are corrected to show no 
offset occurred and the spouse's portion of the payment is reissued if appropriate.  
Additionally, IRS management informed us that on May 13, 2020, programming was 
implemented to discontinue calculating and sending EIPs to prisoners and deceased individuals.  
The IRS also issued new guidance on May 6, 2020, and added the alerts below as part of the EIP 
Frequently Asked Questions on its website:      
• 
Does someone who has died qualify for the Payment?  No.  A Payment made to 
someone who died before receipt of the payment should be returned to the IRS.  Return 
the entire Payment unless the payment was made to joint filers and one spouse had not 
died before receipt of the payment, in which case, you only need to return the portion of 
the payment made to the decedent. 
• 
Does someone who is incarcerated qualify for the Payment?  No.  A payment made 
to someone who is incarcerated should be returned to the IRS.  For a payment made 
with respect to a joint return where only one spouse is incarcerated, you only need to 
return the portion of the payment made on account of the incarcerated spouse. 
Figure 3 shows the number and amount of payments issued to prisoners and deceased 
individuals as of May 21, 2020.   

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Figure 3:  Economic Impact Payments Issued 
as of May 21, 2020 
 
Payments 
Dollars 
Prisoners 
84,861 
$0.1 billion 
Deceased 
1,151,353 
$1.6 billion 
Total Payments Issued  
1,236,214 
$1.7 billion 
Source:  TIGTA analysis of EIPs issued as of May 21, 2020. 
In response to another e-mail alert we sent the IRS on May 1, 2020, the IRS included steps that 
should be taken to return these payments as part of its Frequently Asked Questions.  Individuals 
who received a direct deposit payment in error that was not returned to the IRS by the bank 
were instructed to submit a personal check or money order for the payment amount, notate the 
check as an EIP along with their Taxpayer Identification Number, and mail the check with a short 
note to the IRS at a specified address based on where the individual lives.  Individuals who 
received a paper EIP check in error were instructed to return the voided check with a short note 
to the IRS at the address provided based on where the individual lives. 
In our discussions with IRS management regarding the actions being taken to recover these 
payments, IRS management informed us that, at this time, they are relying on individuals to 
voluntarily return these payments.  We will continue to evaluate the IRS’s issuance of potentially 
erroneous EIPs and its efforts to recover these payments once identified.   
EIP payments issued to nonresidents  
On May 1, 2020, we sent an alert to the IRS detailing our identification of EIPs issued to 
individuals who are likely not U.S. residents.  We conducted our analysis based on reports by 
news media that individuals who were not U.S. residents were receiving EIPs.  Our analysis of 
payments issued as of May 21, 2020, identified 309,601 payments totaling more than 
$423 million that were issued to individuals whose Social Security Number indicates they are a 
legal alien authorized to work in the United States.  However, these individuals had no Federal 
Insurance Contributions Act tax withheld from their wages in Calendar Years 2018 or 2019.6  Of 
the 309,601 payments, 27,808 payments totaling $34 million were calculated by the IRS using a 
tax return with a foreign address.  In response to our alert, the IRS added the following 
Frequently Asked Question to its website: 
• 
Does someone who is a resident alien qualify for the Payment?  A person who is a 
nonresident alien in 2020 is not eligible for the Payment.  A person who is a qualifying 
resident alien with a valid Social Security Number is eligible for the Payment only if he or 
she is a qualifying resident alien in 2020 and could not be claimed as a dependent of 
another taxpayer for 2020.  Aliens who received a payment but are not qualifying 
resident aliens for 2020 should return the payment to the IRS.     
Finally, in response to our question about actions taken to ensure that EIPs are sent only to U.S. 
residents, IRS management indicated that only taxpayers filing a Form 1040, U.S. Individual 
Income Tax Return, were considered for the EIP.  Taxpayers filing the Form 1040-NR, U.S. 
                                                 
6 Certain nonresident aliens are exempt from FICA taxes based on their VISA type, such as nonresident alien students 
and professors temporarily present in the United States. 

 
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Nonresident Alien Income Tax Return, are not eligible for the EIP.  IRS management further 
informed us that, at this time, they are relying on individuals to voluntarily return these 
payments.  We will continue to evaluate the IRS’s issuance of potentially erroneous EIPs and its 
efforts to recover these payments once identified. 
Duplicate EIP payments issued 
On May 12, 2020, we sent an alert to the IRS that we identified 40,656 individuals who received 
two EIP payments as of April 30, 2020.  The payments issued in error totaled more than $61 
million.  Subsequent to our issuance of this alert, we continued to analyze payment files, and as 
of May 21, 2020, we identified 46,759 individuals who received two EIP payments.  The 
payments issued in error totaled more than $69 million.  These included: 
• 
16,339 individuals who filed as Married Filing Jointly in Tax Year 2018 as the secondary 
taxpayer on a tax return and filed as Single (i.e., Single, Head of Household, Qualifying 
Widow(er), or Married Filing Separately) in Tax Year 2019 as the primary taxpayer on a 
tax return.  One payment was sent to the bank account or address shown on the Tax 
Year 2018 tax return, and one payment was sent to the bank account or address shown 
on the Tax Year 2019 tax return.  
• 
30,420 individuals who filed as Single in Tax Year 2018 as the primary taxpayer on a tax 
return and filed as Married Filing Jointly in Tax Year 2019 as the secondary on a tax 
return.  One payment was sent to the bank account or address shown on the Tax 
Year 2018 tax return, and one payment was sent to the bank account or address shown 
on the Tax Year 2019 tax return. 
IRS management noted that programming requirements were put in place to ensure that 
multiple EIPs were not issued to the same individual.  However, because the IRS processed 
payments based on both Tax Years 2018 and 2019 return filings, the programming was unable 
to mark the account for the Tax Year 2018 return to show a payment was issued before the Tax 
Year 2019 payment was issued.  Presently, the IRS is asking individuals to voluntarily return 
payments.  We plan to continue monitoring the IRS’s actions to recover these payments. 
Analysis of EIP payments issued as of May 21, 2020, identified 99,778 individuals with addresses in a 
U.S. Territory who received more than $162 million in EIPs   
Based on the identification of duplicate payments and our concern that duplicate payments 
could also be issued to this population of individuals, we met with IRS management to discuss 
processes and procedures they developed to ensure that duplicate payments are not issued to 
individuals who have an address in a U.S. Territory and previously received an EIP.  IRS 
management indicated that U.S. Territories are responsible for determining who is eligible to 
receive an EIP payment, the amount of the payment, as well as issuing the payment.  IRS 
management further explained that each U.S. Territory included steps to identify duplicate 
payments in their respective EIP Implementation Plans. 
In addition, to assist U.S. Territories in the identification of potential duplicate payments, the IRS 
also identified payments made to individuals with a U.S. Territory address similar to the analysis 
we performed and sent these files to the Territories.  Finally, IRS management noted that each 
U.S. Territory is required to send data to the IRS on a monthly basis beginning June 30, 2020, 
which detail the specific individuals who were issued an EIP by the U.S. Territory.  We requested 

 
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these files for use in our continued assessment of IRS processes to ensure individuals living in a 
U.S. Territory do not receive multiple payments. 
Some eligible individuals still have not received an EIP 
Due to the complexity and speed at which the IRS was required to issue payments, it was unable 
to account for all potential scenarios like the ones we identified below in which eligible 
individuals will need the IRS’s continued assistance to receive the payments to which they are 
entitled.  Our analysis of payment files as of May 21, 2020, identified the following conditions, 
which we brought to IRS management’s attention to be addressed:   
• 
Multiple Deposits to the Same Bank Account – Our analysis identified 
49,141 payments totaling $75 million associated with 8,793 unique bank accounts that 
received four or more direct deposit EIPs.  We first notified the IRS of our concerns on 
April 15, 2020.  According to IRS management, some of these payments occurred 
because the computer programming intended to prevent the direct deposit of payments 
into bank accounts associated with advanced refund products such as a Refund 
Anticipation Loan did not work as intended.  IRS management stated that many of these 
payments may have already been returned by the banks and will be reissued.  We plan 
to continue to monitor the IRS’s efforts to recover payments that have not been returned 
by entities associated with accounts that received multiple deposits, as well as IRS efforts 
to ensure individuals associated with these payments receive their EIP.    
• 
Individuals Who Divorced Between Tax Year 2018 and Tax Year 2019 – Our analysis 
identified 125,132 individuals who were associated with a joint tax return (married) in 
Tax Year 2018 (used by the IRS to compute the EIP).  Subsequent to issuance of the 
payment, one of the individuals filed a Tax Year 2019 return that was not a joint tax 
return (i.e., Single, Head of Household, Qualifying Widow(er), or Married Filing 
Separately).  The EIP was sent to the bank account shown on the jointly filed tax return.  
This scenario could result in the individual who filed a subsequent Tax Year 2019 return 
with a filing status of single not receiving an EIP.  We notified IRS management of our 
concerns on April 17, 2020.  IRS management stated that obtaining the EIP from the 
former spouse is a civil matter between the two individuals who filed the joint Tax 
Year 2018 return.         
• 
Social Security Retirement, Social Security Supplemental Income, and Veteran 
Administration Beneficiaries – The IRS committed to proactively issuing payments to 
individuals who receive Social Security payments, Social Security Supplemental Income 
payments, and veteran’s benefits and do not have a filing requirement.  However, as of 
May 21, 2020, we identified more than 1.3 million of these individuals who have still not 
received an EIP.  The IRS has direct deposit information for 585,329 of these individuals.  
We notified IRS management of our concerns that these individuals have not yet 
received an EIP.  IRS management reviewed the cases we provided and indicated that 
there are conditions associated with some of these individuals that will take more time 
to resolve before eligibility can be determined and a payment can be issued.  We are 
continuing to work with the IRS to ensure that eligible individuals in this remaining 
population receive their EIP. 

 
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Actions are being taken to better inform and assist homeless individuals  
A letter to the Secretary of the Treasury dated April 7, 2020, signed by 28 U.S. Senators, inquired 
about the IRS’s efforts to assist homeless individuals in receiving their EIPs.  To gain an 
understanding of the challenges faced by these individuals, we reached out to one of the 
Department of Housing and Urban Development’s Continuum of Care Program partners in 
Massachusetts.  We learned that homeless individuals face additional challenges in filing the tax 
return needed to receive an EIP, and if successfully filed, they are then presented with additional 
challenges in accessing their issued payment.  For example: 
The IRS recommends individuals use the online Non-Filers:  Enter Payment Info Here tool 
on IRS.gov.  However, many homeless do not have access to a computer to file a return.  
This is further complicated by the fact that many locations with public access to a 
computer have been closed due to the pandemic.  Finally, these individuals often do not 
have access to a bank account and are unable to negotiate a paper check once received 
because they do not have the necessary government issued identification to verify their 
identity. 
Recognizing the significant challenges these individuals face, we alerted the IRS on 
May 15, 2020, of the need to take additional actions to further assist this population.  Our alert 
included the following recommendations: 
• 
Coordinate with the Department of Housing and Urban Development to leverage the 
Continuum of Care Program to disseminate the following information to partner 
organizations for use in assisting homeless individuals and families in filing the tax 
return needed to obtain an EIP. 
o Instructions on how to access the Form 1040 on IRS.gov for use in filing a 
short-form paper return.  These instructions should also provide steps these 
organizations can take to place bulk orders for the Form 1040 once the National 
Distribution Center reopens. 
o Instructions on how to complete a paper Form 1040 for individuals who have no 
filing requirement, including how to notate the return to identify it as an EIP2020 
return. 
o Instructions on where to mail the tax return based on their geographical location. 
• 
Coordinate with the Department of Housing and Urban Development to obtain a list of 
trusted addresses for the Continuum of Care partners for use in processing tax returns 
filed by the homeless.  Often, the homeless use the address of these partners as their 
mailing address, resulting in multiple tax returns having the same address, which is one 
of the IRS’s fraud screening factors.  
• 
Partner with the BFS to issue the EIPs on a U.S. debit card to all individuals filing an 
EIP2020 return.  At a minimum, the IRS should use the trusted address information for 
the Continuum of Care partners to identify returns filed using these addresses and 
ensure that the associated EIPs are issued on a debit card.  
• 
Partner with national organizations dedicated to serving the homeless, such as the 
National Health Care for the Homeless Council, to identify other potential solutions for 
assisting individuals experiencing homelessness in obtaining and accessing their EIP.  

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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In response, IRS management stated that it has partnerships with numerous Federal agency and 
nongovernment organizations, including the Department of Housing and Urban Development, 
that provide assistance to the homeless.  As of June 12, 2020, the IRS has reached out to 4,598 
homeless shelters with information on how to obtain an EIP.  The IRS agreed to reach out to the 
Department of Housing and Urban Development to include the Continuum of Care program to 
provide the information we recommended.  The IRS will also continue to reach out to other 
national organizations dedicated to assisting the homeless to identify other possible solutions 
for assisting these individuals.  In addition, the IRS created a strike team to research potential 
organizations nationwide that might assist homeless individuals and share IRS-related EIP 
resources with them.  The IRS asked these organizations if they would act as a “trusted partner” 
to receive payments on behalf of their homeless clients.  We will continue to monitor the IRS’s 
efforts to inform this population of individuals on how to obtain an EIP.  
The issuance of EIPs on prepaid debit cards is presenting challenges for individuals 
Limitations on the number of paper checks the BFS can issue each week further delay the 
issuance of some EIPs to individuals for whom the IRS does not have a direct deposit account 
number.  To minimize the impact of these limitations and to get the payments out to 
individuals, as of May 21, 2020, a total of 3.6 million individuals were sent their payment as a 
prepaid debit card instead of paper check.  An IRS news release dated May 27, 2020, noted that 
the determination of which taxpayers received a debit card was made by the BFS.  Those who 
receive their payment by prepaid debit card can do the following without any fees: 
• 
Make purchases online and at any retail location where Visa is accepted. 
• 
Get cash from in-network Automated Teller Machines. 
• 
Transfer funds to their personal bank account. 
• 
Check their card balance online, by mobile app, or by phone. 
This free, prepaid card also provides consumer protections available to traditional bank account 
owners, including protection against fraud, loss, and other errors. 
However, a number of news outlets have reported that the debit cards were mailed in unmarked 
envelopes and little notice was provided to the public about the issuance of these cards.  As 
such, individuals have reported that they destroyed the cards, thinking that they were a scam or 
an unsolicited credit card offer.  In an effort to address these concerns, the IRS recently added 
the information below to the Frequently Asked Questions on IRS.gov: 
• 
What do I do if my prepaid debit card was lost or destroyed?  
The Economic Impact Payment Card is sponsored by the Treasury Department’s Bureau 
of the Fiscal Service, managed by Money Network Financial, LLC and issued by Treasury’s 
financial agent, MetaBank®, N.A.  If you receive an Economic Impact Payment Card, it 
will arrive in a plain envelope from “Money Network Cardholder Services.”  The Visa 
name will appear on the front of the Card; the back of the Card has the name of the 
issuing bank, MetaBank®, N.A.  Information included with the Card will explain that the 
card is your Economic Impact Payment Card.  Please go to EIPcard.com for more 
information and additional FAQs. 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Individuals who have lost or destroyed their EIP Card may request a free replacement 
through MetaBank® Customer Service.  Individuals may request a replacement by phone 
at 800-240-8100 (option 2 from main menu).   
In our discussion with representatives from the BFS and MetaBank on June 11, 2020, MetaBank 
representatives estimated that they have received 30,000 to 35,000 requests for a replacement 
card to date.  We plan to continue to assess the IRS’s issuance of EIPs on prepaid debit cards 
and assistance to those individuals issued these cards. 
A Separate TIGTA review is assessing IRS efforts to ensure eligible individuals receive an 
EIP 
This review will monitor the IRS’s efforts to address the conditions identified above and actions 
to reissue payments to eligible individuals.7  In addition, we will assess the IRS’s efforts to 
address rejected direct deposits, payments returned as undeliverable, inquiries from individuals 
who received notification that a payment was sent but it has not been received, and outreach to 
individuals without a filing requirement who need to file a tax return to receive their EIP. 
Advance Tax Credits for Employers 
As previously noted in our report, there are two new employer tax credits for businesses that 
have been severely affected by COVID-19 – the Credit for Sick and Family Leave, and the 
Employee Retention Credit:  
• 
Paid sick leave credit and paid family leave credit are available for eligible employers 
who pay qualified sick leave wages or qualified family leave wages from April through 
December 2020 and who have fewer than 500 employees. 
• 
The Employee Retention Credit is designed to encourage businesses to keep employees 
on their payroll.  The refundable tax credit is 50 percent of up to $10,000 in wages paid 
by an eligible employer whose business has been financially affected by COVID-19. 
In response to the enactment of this legislation, the IRS initiated an educational campaign to 
promote the availability of these credits.  As we previously detailed, the law allows eligible 
employers to request advance payments of these credits.  Specifically, an eligible employer that 
pays qualified leave wages to its employees in a calendar quarter before it is required to deposit 
Federal employment taxes with the IRS for that quarter may reduce the amount of Federal 
employment taxes that it deposits by the amount of the qualified leave wages paid.  The eligible 
employer must account for the reduction on the Form 941.   
However, if there are insufficient Federal employment taxes to cover the amount of the credits, 
an eligible employer may request an advance payment of the credits from the IRS.  To enable 
employers to request an advance, the IRS developed the new Form 7200.  Along with the 
development of the form, the IRS also developed processes and procedures to enable 
employers to submit these requests even though the Tax Processing Centers were closed.  For 
example, the IRS implemented a process to enable employers to submit these requests via a 
dedicated E-fax line.  Once a Form 7200 is received electronically, it is routed to a dedicated 
group of revenue agents and revenue officers who review and process these requests.  
                                                 
7 TIGTA, Audit No. 202040634, Assessment of Actions to Ensure That All Eligible Individuals Receive an Economic 
Impact Payment. 

 
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Employers could begin to submit their Form 7200 starting April 1, 2020.  As of May 30, 2020, the 
IRS received 7,789 Forms 7200, and processed 2,410 Forms 7200 with refunds totaling more 
than $50 million. 
In addition, the IRS also revised Form 941, adding lines to account for the various employment 
tax credits (e.g., paid and sick leave credit and Employee Retention Credit) and other tax relief 
(e.g., deferral of payroll tax) due to the coronavirus.  Businesses will begin filing the revised 
Form 941 for their second quarter employment taxes due at the end of July 2020.  In addition, 
businesses that requested and received an advance payment by filing Form 7200 will record that 
amount on the revised Form 941 to determine whether they owe additional employment taxes 
or are due a refund.   
Efforts are ongoing to obtain *************2*************** needed to verify 
that employers are not erroneously claiming the excluded credit  
The CARES Act contains an exclusion that businesses which received a Paycheck Protection 
Program loan from the Small Business Administration cannot receive an advanced Employee 
Retention Credit.  *****************************2**************************************************** 
************************************************2**************************************************** 
************************************************2**************************************************** 
***2***.  According to IRS management, they are currently coordinating with the Small Business 
Administration ********************************2**************************************************** 
***2*** to ensure employer compliance with provisions in the CARES Act.  ***********2*********** 
************************************************2**************************************************** 
************************************************2******************************************.  We are 
conducting a separate review to evaluate the actions taken by the IRS to ensure the validity and 
accuracy of the processing of advanced employer credits.8 
Tax Processing Center Closures Have Resulted in Significant Backlogs  
Much of the work performed at the IRS’s Tax Processing Centers is not conducive to a telework 
environment.  Work performed at Tax Processing Centers includes mail operations which involve 
the receiving, sorting, and distributing of mail and processing of paper tax returns.  Processing 
requires manual input of information from the tax return into IRS systems, correcting errors, and 
corresponding with the taxpayer, if needed.  As noted earlier, the IRS closed its Tax Processing 
Centers due to the COVID-19 pandemic.  Figure 4 shows the date each of these Tax Processing 
Centers were closed.   
                                                 
8 TIGTA, Audit No. 202040633, Actions Taken to Ensure the Validity of COVID-19 Relief Advanced Credits.   

 
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Figure 4:  Tax Processing Center Closures  
Due to COVID-19, as of April 6, 2020 
Location 
Date Closed 
Fresno 
March 20 
Austin 
March 25 
Kansas City 
March 25 
Ogden 
April 6 
Source:  IRS management reports and notification 
for each location’s closure.  
To ensure an orderly shutdown of its Tax Processing Centers, the IRS followed existing 
guidelines that are used when operations are ceased due to a lapse in funding.  The big 
difference with the COVID-19 shutdown is that they had less time to prepare due the urgency of 
the health crisis.  However, IRS management worked with each function to complete any 
in-process inventory by the end of the final work shift on the day of closing.  They also ensured 
that all tax returns were secured and marked so it would be easy to pick up where they left off 
when the Tax Processing Centers reopened.  The paper tax returns are controlled in an IRS 
system that helps track levels of inventory at various stages of processing the tax returns.  IRS 
management also turned off all fax machines as part of its closure process in order to prevent 
correspondence from taxpayers coming into the sites when employees were not present to work 
the inventory.  Finally, the IRS also coordinated with the U.S. Postal Service to have all mail that 
could not be delivered onsite be either held by the Postal Service or stored in semi-trailers at 
each location as needed. 
Mail receipt and paper tax return processing have only partially resumed 
As of May 20, 2020, the IRS estimates that it has received 10.4 million pieces of mail while the 
Tax Processing Centers were closed.  This includes mail stored within its various Tax Processing 
Centers and in 20 semi-trailers and six storage containers housed outside these Centers.  The 
unopened mail includes tax returns, taxpayer correspondence, payments, and mail returned as 
undeliverable.  Each Tax Processing Center has a mail operation that opens, sorts, counts, and 
routes all incoming mail and packages to their appropriate destinations.  These actions were all 
halted when the Tax Processing Centers were closed.  Furthermore, all paper tax return 
processing was halted.  Figure 5 shows the estimated volume of both individual and business 
paper tax returns received as of May 22, 2020.  These volumes include tax returns received and 
still being processed at the time the IRS closed its Tax Processing Centers as well as the 
estimated number of tax returns received while the centers were closed. 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Figure 5:  Estimated Paper Tax Return Volumes to be Processed  
as of the Week Ending May 23, 2020 
Type of Tax Return 
Week Ending 
April 4, 2020 
Week Ending 
May 2, 2020 
Individual Tax Returns 
3,185,000 
10,070,000 
Business Tax Returns 
2,569,000 
6,569,000 
Source:  Estimated volumes of paper tax returns received from the IRS’s Filing 
Season Statistics Reports for the weeks ending April 4, 2020, and May 23, 2020. 
IRS management noted that the above figures are only estimates and include tax returns 
received in the unopened mail.  The actual number will not be known for months (until all the 
mail is opened).  The IRS bases these estimates on scheduled and actual work generated 
through its inventory tracking system that keeps track of scheduled work for each Tax 
Processing Center.  Our review of the IRS’s inventory tracking system showed that nearly 
1.8 million individual and nearly 1.9 million business paper tax returns were in process at the 
time the IRS closed the Tax Processing Centers and need to be completed.   
The IRS began recalling staff on a voluntary basis to open mail and deposit checks in each of the 
four Tax Processing Centers on April 27, 2020.  As of May 18, 2020, there were 389 employees 
working in the mail operations of the Tax Processing Centers.9  This is compared to 
1,786 employees that worked in the mail operations prior to closure.  Our review of the IRS’s 
inventory tracking system shows that, as of May 22, 2020, the IRS had extracted and input into 
its inventory system approximately 842,000 tax returns received in the mail that had 
accumulated during the closures.   
Error Resolution cases remain backlogged 
When Tax Processing Centers were closed, taxpayers still had the ability to electronically file 
(e-file) their tax returns.  E-filed returns with no identified error or review conditions are 
processed to completion, with any associated refund being issued.  However, similar to paper 
tax returns, e-filed tax returns identified with errors are sent to the IRS’s Error Resolution 
function for tax examiner review.  Specifically, when a tax return is identified with an error 
condition, the IRS suspends the tax return from processing and sends the tax return to a tax 
examiner to correct the error.  The Error Resolution function is responsible for correcting these 
error conditions.  Once corrected, the tax return will continue to be processed.  The majority of 
this work was unable to be performed while the Tax Processing Centers were closed.  However, 
the IRS was able to work some e-filed cases identified as needing correction by an Error 
Resolution function employee.  Figure 6 shows the volume of Error Resolution cases as of 
May 22, 2020, that still need to be worked.  
                                                 
9 Austin, Texas, had 108 employees; Fresno, California, had 107 employees; Kansas City, Missouri, had 60 employees; 
and Ogden, Utah, had 114 employees that had returned to work. 

 
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Figure 6:  Error Resolution Volumes for 
Tax Processing Centers as of May 22, 2020 
Type of Tax Return 
As of  
April 3, 2020 
As of  
May 22, 2020 
Individual Tax Returns 
984,830 
1,599,091 
Business Tax Returns 
111,816 
    153,287 
Source:  Error Resolution volumes from the IRS’s Filing Season Statistics Reports 
for the weeks ending April 4, 2020, and May 23, 2020. 
Closures Are Affecting Efforts to Provide Quality Customer Service  
When the IRS closed its offices nationwide, most customer service assistance options for 
taxpayers ceased.  For example: 
• 
Toll-Free Lines – According to the IRS, there are 105 toll-free lines available to provide 
assistance to taxpayers prior to March 19, 2020.10  The IRS ceased answering 
96 (91 percent) of these lines between March 19 and 31, 2020, because the IRS locations 
were closing and employees answering these phone lines were not telework ready.  As 
of May 20, 2020, 48 (46 percent) of the 105 toll-free lines remained closed.  These 
include lines that provide assistance with tax law questions, requesting transcripts of tax 
accounts, and setting up appointments for face-to-face assistance.  
We asked IRS management how they are prioritizing the reopening of toll-free lines, and 
they informed us that their strategy included looking at the number of assistors available 
and their experience level for the type of assistance provided on the lines that need to 
be reopened.  Based on these considerations, management determined the potential 
levels of service they could provide by reopening the line.  IRS management stated that 
they will continue to monitor and open the remaining lines as soon as it is determined 
to have sufficient staffing with the necessary experience to operate that line.   
• 
TACs – TACs provide taxpayers face-to-face assistance with an IRS employee, by 
appointment.  All 358 TACs were closed nationwide effective March 23, 2020.  According 
to IRS management, TAC employees are not eligible for telework and do not have 
laptops to allow for remote work.  IRS management did note that there was a pilot 
ongoing prior to the pandemic allowing a limited number of TAC employees to provide 
virtual assistance to taxpayers through a web-based software, but this went on hold 
when the TACs closed.  IRS management stated that they have no intention of 
expanding this service at this time because they do not have the results of the pilot to 
know if this was effective.  As of June 12, 2020, management stated that the software 
they were using in the pilot does not have the system capabilities to be used nationwide. 
At the time of closure, there were 79,264 appointments made to assist taxpayers, which 
were all cancelled.  As of May 19, 2020, there are approximately 1,040 employees that 
work in the 358 TACs nationwide on weather and safety leave.  As of June 1, 2020, 
                                                 
10 Two additional lines, the EIP and COVID-19 Counsel Hotline, were opened after March 30, 2020, in response to the 
pandemic. 

 
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108 TAC employees were recalled in Kentucky, Texas, and Utah.  However, these 
employees are not providing face-to-face assistance at this time.      
• 
Free Tax Return Preparation – The IRS Volunteer Income Tax Assistance and the Tax 
Counseling for the Elderly programs offer free tax help for taxpayers who qualify.  While 
the IRS manages the programs, the sites are managed by IRS partners and staffed by 
their volunteers.  For the week ending May 24, 2020, 10,792 (98 percent) of the 
11,014 Volunteer Income Tax Assistance/Tax Counseling for the Elderly sites remain 
closed.      
• 
Distribution of Tax Products – The National Distribution Center closed on 
March 25, 2020, and as of June 1, 2020, remains closed.  The National Distribution Center 
provides printing and distribution services of IRS forms, publications, etc., for both the 
IRS and external stakeholders.  Figure 7 provides a list of the National Distribution 
Center stakeholders. 
Figure 7:  Primary Users of the National Distribution Center Services 
User 
Description of Supplies Provided 
Taxpayer 
Supplies individuals with tax-related materials for personal use.   
Tax Professional 
A person or firm that prepares tax returns for compensation or 
orders products to meet tax reporting requirements. 
Tax Forms Outlet 
Program 
Supplies post offices, libraries, and other outlets with tax materials 
for distribution to the public.  
TACs 
Supplies TACs with products for distribution to the public.  
Volunteer Income 
Tax Assistance 
Supplies Volunteer Income Tax Assistance sites with tax forms, 
instructions, and publications.  
International 
Program 
Supplies American embassies with tax forms to meet the needs of 
Americans overseas.  
Employer 
Supplies businesses with employment tax products for employee 
and company use.  
IRS 
Supplies packages of tax products for conferences administered by 
IRS employees, etc.  
Other Government 
Agencies 
Supplies other Federal, State, and local agencies with tax materials 
to act as a third-party distributor or meet its tax reporting 
requirements. 
Source:  Internal Revenue Manual 1.18.5. 
• 
Printing and Mailing Correspondence to Taxpayers – The IRS prints and mails the 
majority of its correspondence from two centralized sites located in Detroit, Michigan, 
and Ogden, Utah.  These operations are referred to as Correspondence Production 
Services.  Correspondence generated and mailed to taxpayers includes notices to alert 
taxpayers that error conditions on their held tax return need to be addressed, the need 

 
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to authenticate their return as it has been held as potentially fraudulent, as well as 
notices and letters required to be issued by law.   
In response to the pandemic, the IRS closed both of these sites as of April 8, 2020.  A 
total of 154 employees work at these sites.  As of May 14, 2020, the IRS reported that 
there were more than 22.1 million items in the Correspondence Production Services 
queue to be printed and mailed.  IRS management explained that they are coordinating 
with all affected IRS functional areas to prioritize which notices should be mailed first 
when resuming operations and which notices are no longer necessary and could be 
purged (for example, monthly payment reminders on installment agreements for months 
that have already passed).   
As of June 1, 2020, the IRS recalled 41 of its Ogden, Utah employees, in an effort to 
resume its printing and mailing services.  The IRS plans to reopen the operation in 
Detroit the week of June 15, 2020, with reduced staffing.  IRS management estimates 
that it will take Correspondence Production Services until mid-July to work through the 
backlog of print requests in the queue because of the anticipated reduced staffing levels 
and the need to social distance.  According to the IRS, the estimate of time to work 
through the backlog is contingent upon procuring a vendor to assist with printing or 
mailing notices. 
Accounts Management function has a significant backlog of cases critical to taxpayers 
As of March 14, 2020, the IRS reports that there were 17,534 employees working in the Accounts 
Management function.  In comparison, as of May 16, 2020, only 5,562 Accounts Management 
employees (32 percent) were teleworking or reporting to an office.  The Accounts Management 
function is responsible for assisting taxpayers with questions about the tax laws, their account, 
and the status of their refunds and adjusting their tax accounts when necessary.  As of 
March 14, 2020, the IRS reported that the ending inventory that still needed to be worked was 
2.5 million cases.  The inventory only increased slightly to 2.6 million as of May 16, 2020.  
However, this inventory does not include additional Accounts Management work included in the 
unopened mail.  The IRS estimates that there are 970,333 pieces of unopened mail as of 
May 9, 2020, that require Accounts Management review at the four Tax Processing Centers. 
In addition, Accounts Management also receives mail at six other Accounts Management 
locations nationwide.  The IRS estimates that there are 389,844 pieces of unopened mail at 
these campuses as of June 2, 2020.11  Based on staffing and IRS reports as of May 16, 2020, the 
IRS is closing nearly 119,000 cases per week.  At this rate, we estimate that it will take 33 weeks 
before Accounts Management is in a position to get through the backlog, not considering new 
receipts.  At best, the IRS was closing approximately 391,000 cases for the week proceeding 
March 14, 2020.   
Although the majority of cases worked by Accounts Management are electronic and portable, 
there are two factors that affect the IRS’s ability to address the type of cases worked: 
• 
Ability to Scan Correspondence into the Correspondence Imaging System – 
Correspondence from taxpayers that needs to be worked by Accounts Management is 
received and scanned at IRS Tax Processing Centers to enable employees working in 
                                                 
11 This includes all mail received at these six campuses.  The IRS does not have an estimate of mail specific to 
Accounts Management for these six locations.   

 
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remote locations to work the cases.  If employees responsible for scanning this 
correspondence are not allowed to return to the Tax Processing Centers or the number 
of employees returning is limited, this will have a direct impact on scanning inventory 
into the Correspondence Imaging System for Accounts Management employees to work.   
• 
Extensiveness of the Process to Make Employees Telework-Ready – To make 
employees telework-ready, the IRS must obtain the necessary equipment, have 
employees complete the necessary training, and sign telework agreements with their 
manager.  IRS management noted that they can realistically get 200 to 400 employees 
telework-ready per week.  Since the closure of its operations, IRS management has 
continued to increase the number of telework-ready employees in order to remotely 
work the Accounts Management inventory.  For example, at the time of closure, a 
telework pilot included only 237 employees.  As of May 16, 2020, a total of 
4,841 employees were actively teleworking.  However, despite these improvements, 
there are still nearly 8,427 employees who are not telework-ready and remain on 
weather and safety leave.   
We will continue to monitor the IRS’s efforts to address its backlogs.  In addition, we have a 
separate ongoing review that will assess the impact of the COVID-19 pandemic on IRS customer 
service operations and the actions taken to resume these operations. 
More Than a Million Tax Returns Identified and Held As Potentially Fraudulent 
or With Erroneous Refundable Credit Claims Remain to Be Worked 
The IRS’s Return Integrity and Compliance Services function is responsible for addressing 
potentially fraudulent returns identified as well as returns identified with questionable 
refundable credit claims.  Once a return is identified, those involving potential identity theft are 
held during processing until the IRS can verify the taxpayer’s identity.  If the IRS cannot confirm 
the individual’s identity, the IRS removes the tax return from processing to prevent the issuance 
of a fraudulent refund.  For other types of potentially fraudulent tax returns identified (i.e., 
non-identity theft), the IRS suspends these tax returns to provide additional time to receive 
third-party income documents (e.g., Form W-2, Wage and Tax Statement).  The suspended tax 
returns are held until either the IRS receives third-party documents and the income and 
withholding is verified or the tax returns are sent to Return Integrity and Compliance Services 
for screening and verification.   
The Return Integrity and Compliance Services function also conducts examinations of tax 
returns with questionable refundable credit claims.  For those returns selected for examination, 
the IRS corresponds with taxpayers to request additional documentation to support their 
refundable credit claim.  During the week ending May 23, 2020, the Return Integrity and 
Compliance Services inventory included: 
• 
892,777 tax returns identified as identity theft for which the taxpayer has been asked to 
authenticate their identity.  
• 
463,192 tax returns identified as non-identity theft for which the IRS has selected the 
return for treatment. 
• 
243,925 tax returns selected for examination.  These returns primarily involve a 
questionable refundable tax credit.   

 
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The above figures do not include tax returns that were identified by the Return Integrity and 
Compliance Services fraud and examination filters that have not yet been selected for treatment. 
Return Integrity and Compliance Services management noted that, although their employees 
can work cases remotely, external factors are preventing this work from being performed.  These 
factors include: 
• 
The inability to print and mail required correspondence due to Correspondence 
Production Services site closures – Management noted that, even if the required 
correspondence could be printed and mailed, responses from taxpayers are sent to the 
IRS and require scanning to enable the information to be available for employees 
working remotely.  However, because the IRS locations have been closed, the responses 
cannot be scanned into the system.   
• 
Refundable credit claims are prerefund examinations – Per the People First Initiative, 
no compliance actions can be taken until July 15.   
As of June 3, 2020, Return Integrity and Compliance Services had 756 (41 percent) of their 
1,863 employees on weather and safety leave because they were unable to perform work in a 
telework environment for various reasons, such as not having a laptop or high-speed Internet.  
In addition, while 544 (72 percent) of the 756 employees had laptops, their work was not 
portable. 

 
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Appendix I 
Detailed Objective, Scope, and Methodology 
Our overall objective was to evaluate whether the IRS timely and accurately processed individual 
paper and e-filed tax returns during the 2020 Filing Season.  This audit was initiated to provide 
selected information related to the impact of COVID-19 on the 2020 Filing Season.  To 
accomplish our objective, we: 
• 
Monitored online news outlets and forums to identify any preparation, filing, or 
processing issues that taxpayers are experiencing. 
• 
Coordinated with TIGTA’s audit team covering the issuance of EIPs for individuals to 
obtain initial results on the accuracy of the EIP computation and related notifications.  
• 
Coordinated with TIGTA’s Business Return Services audit teams for information on 
business tax return processing and the impact of the COVID-19 relief provisions.  
• 
Coordinated with TIGTA’s audit team assessing the impact that closures of toll-free, TAC, 
and Volunteer Income Tax Assistance sites had on the IRS’s ability to provide quality 
customer service.  
• 
Identified volumes of paper tax returns in process at the time the Tax Processing Centers 
were closed and the estimated volumes of mail and tax returns received during closure 
through May 22, 2020.   
• 
Evaluated IRS plans to address backlogs in paper return filings, payments, 
correspondence, error resolution, and fraud detection cases once Tax Processing Centers 
reopen. 
Performance of This Review 
This review was performed with information obtained from the Wage and Investment Division 
Headquarters in Atlanta, Georgia; the Wage and Investment Division Submission Processing 
function offices in Cincinnati, Ohio; the Wage and Investment Division Customer Assistance, 
Relationships, and Education function in Atlanta, Georgia; the Wage and Investment Division 
Accounts Management function in Atlanta, Georgia; the Wage and Investment Division Return 
Integrity and Compliance Services function in Atlanta, Georgia; and the Information Technology 
organization in Lanham, Maryland, during the period March 30, 2020, through June 10, 2020.  
We conducted this performance audit in accordance with generally accepted government 
auditing standards.  Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions 
based on our audit objective.  We believe that the evidence obtained provides a reasonable 
basis for our findings and conclusions based on our audit objective. 
Major contributors to the report were Russell P. Martin, Assistant Inspector General for Audit 
(Returns Processing and Account Services); Deann L. Baiza, Director; Linna K. Hung, Director; 
Diana M. Tengesdal, Director; Jeffrey D. Cullum, Audit Manager; Nina A. Hill, Audit Manager; 
Jonathan W. Lloyd, Audit Manager; Sharla J. Robinson, Audit Manager; Darryl J. Roth, Audit 
Manager; Ngan B. Tang, Audit Manager; Van A. Warmke, Audit Manager; Karen C. Fulte, Senior 
Auditor; Brieane K. Hamaoka, Senior Auditor; Tracy M. Hernandez, Senior Auditor; Sandra L. 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Implement Legislative Provisions 
Hinton, Senior Auditor; Robert J. Howes, Senior Auditor; Jane G. Lee, Senior Auditor; David P. 
Robben, Senior Auditor; Heidi C. Turbyfill, Senior Auditor; Linda M. Valentine, Senior Auditor; 
Michael J. Bibler, Auditor; Laura R. Christoffersen, Auditor; Branden L. Dreher, Auditor; Jaclynne 
O. Durrant, Auditor; James M. Allen, IT Specialist; Karen A. Brown, IT Specialist; Hong Cao, 
IT Specialist; Shannon D. Cummings, IT Specialist; Meera B. Dave, IT Specialist; Cheryl F. Joneckis, 
IT Specialist; Donald J. Meyer, IT Specialist; Johnathan D. Elder, IT Specialist, Applied Research 
and Technology; and Laura P. Haws, IT Specialist, Applied Research and Technology. 
Validity and Reliability of Data From Computer-Based Systems 
During this review, we obtained extracts from the Individual Master File for Tax Years 2018 and 
2019, Individual Return Transaction File for Processing Years 2019 and 2020, Information 
Returns Master File for Tax Years 2018 and 2019, Prisoner File for Processing Year 2019, 
Individual Master File Refund Files, and National Account Profile for Processing Year 2020 that 
were available on TIGTA’s Data Center Warehouse.  We also obtained the Social Security 
Supplemental Income and Veteran Administration beneficiary recipient files from the IRS.  
Before relying on the data, we ensured that each file contained the specific data elements we 
requested.  In addition, we selected judgmental samples of each extract and verified that the 
data in the extracts were the same as the data captured in the Integrated Data Retrieval System.  
We also performed analysis to ensure the validity and reasonableness of our data, such as 
ranges of dollar values and obvious invalid values.  Based on the results of our tests, we believe 
that the data used in our review were reliable. 
Internal Controls Methodology 
Internal controls relate to management’s plans, methods, and procedures used to meet their 
mission, goals, and objectives.  Internal controls include the processes and procedures for 
planning, organizing, directing, and controlling program operations.  They also include the 
systems for measuring, reporting, and monitoring program performance.  We determined that 
the following internal controls were relevant to our audit objective:  the process for planning, 
organizing, directing, and controlling program operations for the 2020 Filing Season.  We 
evaluated these controls by meeting with IRS management, reviewing IRS procedures, and 
reviewing IRS reports.  
 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Appendix II 
High-Level Process Flow of IRS Documents 
Figure 1 provides a high-level process flow of the processing of documents received by the IRS. 
 
Figure 1:  High-Level Process Flow of IRS Documents 
 
Source:  TIGTA’s analysis to show a high-level process flow of Submission Processing and Accounts 
Management inventory processes.

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Appendix III 
Glossary of Terms 
Term 
Definition 
Filing Season 
The period from January through mid-April when most individual income tax 
returns are filed. 
Fiscal Year 
Any yearly accounting period, regardless of its relationship to a calendar 
year.  The Federal Government’s fiscal year begins on October 1 and ends on 
September 30. 
Free File 
A free Federal tax preparation and e-filing program for eligible taxpayers 
developed through a partnership between the IRS and Free File Alliance LLC.  
The Alliance is a group of private sector tax software companies. 
Level of Service 
The primary measure of service to taxpayers.  It is the relative success rate of 
taxpayers who call for live assistance on the IRS’s toll-free telephone lines.  
The IRS’s measure is titled Customer Service Representative Level of Service. 
Individual Master File 
The IRS database that maintains transactions or records of individual tax 
accounts. 
Individual Return 
Transaction File 
A database the IRS maintains that contains information on the individual tax 
returns it receives.  
Information Returns 
Master File 
Creates and maintains a master file of current and prior year information 
returns. 
Integrated Data Retrieval 
System 
IRS computer system capable of retrieving or updating stored information. It 
works in conjunction with a taxpayer’s account records. 
Master File 
The IRS database that stores various types of taxpayer account information.  
This database includes individual, business, and employee plans and exempt 
organizations data. 
National Account Profile 
A compilation of selected entity data from various IRS Master Files and the 
Social Security Administration. 
Prisoner File 
The IRS compiles a list of prisoners received from the Federal Bureau of 
Prisons and State Departments of Corrections as well as Prisoner Update 
Processing System data from the Social Security Administration. 
Processing Year 
The calendar year in which the tax return or document is processed by the 
IRS. 
Tax Year 
A 12-month accounting period for keeping records on income and expenses 
used as the basis for calculating the annual taxes due.  For most individual 
taxpayers, the tax year is synonymous with the calendar year. 
Taxpayer Assistance 
Centers  
An IRS office with employees who answer questions, provide assistance, and 
resolve account-related issues for taxpayers face to face. 
Volunteer Program 
Includes the Volunteer Income Tax Assistance Program, including the 
Volunteer Income Tax Assistance Grant Program, and the Tax Counseling for 
the Elderly Program.  The Volunteer Program provides free tax assistance to 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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persons with low to moderate income (generally defined as within the 
Earned Income Tax Credit threshold), senior citizens, persons with disabilities, 
rural persons, those with limited English proficiency, and Native Americans. 
Weather and safety leave 
May be permitted when weather or other safety-related conditions prevent 
employees from safely traveling or safely performing work at an approved 
location, such as the official duty station or telework location. 
 
 

 
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Interim Results of the 2020 Filing Season:  Effect of COVID-19 Shutdown on Tax 
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Appendix IV 
Abbreviations 
BFS 
Bureau of the Fiscal Service 
COVID-19 
Coronavirus Disease 2019  
e-file(d); e-filing 
Electronically File(d); Electronic Filing 
EIP 
Economic Impact Payments 
IRS 
Internal Revenue Service 
TAC 
Taxpayer Assistance Center 
TIGTA 
Treasury Inspector General for Tax Administration

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