It has been brought to our attention by several taxpayers who mailed a payment to IRS that the payment has not yet been processed or that they have recently received a notice from the IRS showing a payment is due even though the payment has already been sent. This is not an isolated issue, and thousands of taxpayers have been affected.
Per the IRS website (updated as of 8/13/2020), “If a taxpayer mailed a check (either with or without a tax return), it may still be unopened in the backlog of mail the IRS is processing due to COVID-19. Any payments will be posted as the date we received them rather than the date the agency processed them. To avoid penalties and interest, taxpayers should not cancel their checks and should ensure funds continue to be available so the IRS can process them.”
On 8/17/2020, the IRS released another notice that states, “The IRS has begun mailing backlogged letters and notices as it returns to normal operations. Many of these are mailed with past due payment or response dates. Instead of generating a new, correct notice, the IRS is including as an insert with the notice or letter a Notice 1052, Important! You Have More Time to Make Your Payment. That insert will provide the updated pay or response date.” The IRS has mailed over 20 million notices since early June with either the insert or with current dates. However, it reports that approximately 11,000 notices went out without the insert, and that they are reaching out to each of the affected taxpayers.
If you have received a notice from IRS that you believe to be in error related to a payment that you made or if you have a payment to IRS that has not yet been processed, we recommend that you allow additional time for the matter to be resolved. For any other IRS-related matters, please contact your tax advisor for additional assistance.
The IRS also announced on August 18th that it would send interest payments this week to about 13.9 million individual taxpayers who filed a 2019 tax return by the July 15th deadline and either received a refund in the past three months or are scheduled to receive a refund. Most of these interest payments will be issued separately from the tax refund. Taxpayers who received their refund by direct deposit can expect their interest payments to be directly deposited into the same account. Other eligible taxpayers will receive a check. These interest payments are a result of the postponement of the filing deadline as a result of COVID-19, since the IRS is required to pay interest, calculated from the original April 15th filing deadline, as long as an individual filed a 2019 federal income tax return by the July 15th postponed deadline.