The IRS makes tax filing simpler for next year with long-awaited improvements
Americans should have a slightly easier filing season in 2024 after the IRS introduced more resources for taxpayers.
The tax agency announced this week that taxpayers can now electronically upload all correspondence, responses to notices, and documents to the agency’s website, which also features an improved "Where's My Refund" tracker. On the customer service front, the Internal Revenue Service is answering its phones more often and is providing in-person tax help centers with extended hours.
The moves — funded by the Inflation Reduction Act — are aimed at establishing a better relationship with taxpayers with more user-friendly services after multiple reports bashed its lack of customer service in the past. More is yet to come, the agency promised, though its track record on tech improvements has been spotty at best.
"Taxpayers will save time and effort," Treasury Secretary Janet Yellen said on Tuesday. "The IRS will reduce errors and storage costs. And we'll speed up processing times for the system as a whole."
Changes for the 2024 tax filing season
Digital correspondence
Taxpayers can now electronically submit all correspondence, non-tax forms, and responses to notices through the "Documentation Upload" tool on the IRS website.
First, they input their correspondence's access code or select the type of letter in the drop-down box when uploading items. They can then upload photos or digital copies of documents to the tax agency and receive confirmation that the documents were submitted.
Earlier this February, taxpayers could only respond to the nine most common correspondences digitally. Prior to that, taxpayers had to answer all responses, explanations, and correspondence through snail mail, causing extensive delays in processing and refunds.
Read more: Do you have to report a personal loan on your taxes?
The new electronic processing system improves the tax system in two ways. It trims the time taxpayers spend on responding to notices and getting their refunds, and it allows IRS agents to record information digitally rather than by hand. The IRS estimated the new change will switch 125 million paper documents to a digital format and 94% of American taxpayers won't have to mail the IRS again.
Refund tracker
The agency’s most popular online tool, "Where's My Refund," will also get a boost for the upcoming tax season.
Before, the tool often gave a standard message that the return was being processed and more information could be found in the Frequently Asked Question section. Taxpayers often had to call the IRS to get more detailed information about the status of the return.
The tool will now provide more precise and more accurate responses when users check the status of their refund, including whether they need to respond to an IRS letter requesting additional information. The update also makes sure the tool works "seamlessly" on mobile devices, the IRS said.
In 2022, the tool generated 550 million hits, with around 54 million taxpayers using it. The IRS estimates taxpayers will view the new version 70 million times in the upcoming filing season.
Phone service
The IRS will keep up with its new and improved phone service in 2024. The agency has been ramping up its customer service division over the past year after a hellish filing season during the pandemic and years before that.
The IRS achieved an 87% response rate during the 2023 filing season, thanks to a fleet of newly hired representatives. The agency announced that it is committed to achieving the same success in the 2024 filing season, with the aim to keep an average wait time of 5 minutes for all callers.
While the IRS so far has achieved a reduced wait time this year, Yahoo Finance previously reported that the tax phone representatives are not always equipped to answer questions correctly or even consistently. An answer to a tax question can differ depending on who picks up the phone on the other end.
"Will [the IRS] give the proper responses? Until [the IRS] prove themselves, we have reason to be skeptical," Scott Hodge, president emeritus and senior policy adviser at Tax Foundation, said. "At least you didn't have to wait very long to get the wrong answer."
Read more: Will I be taxed on student loan forgiveness?
In-person tax assistance
The IRS will also increase in-person tax help at Taxpayer Assistance Centers by more than 8,500 hours nationwide. The agency recently opened or reopened 50 Taxpayer Assistance Centers across the country. Additional pop-up shops and community assistance events will be available in hard-to-reach communities.
"I think these changes are good news. Anytime the taxpayer experience can be improved, I think it's always a win for everyone involved," Grant Dougherty, enrolled agent and founder of Dougherty Tax Solutions, told Yahoo Finance. "I do believe the [2024 filing season] will be a little smoother."
Rebecca Chen is a reporter for Yahoo Finance and previously worked as an investment tax certified public accountant (CPA).
