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IRS plans to delay tax filing deadline until mid-May

By ArLuther Lee, The Atlanta Journal-Constitution

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The Internal Revenue Service is pushing back the deadline for filing taxes to mid-May as the agency is under pressure to process federal stimulus payments, tax returns and refunds all at the same time.

The filing deadline, which usually falls on April 15, will be extended until May 17 this year, giving taxpayers an extra month to file their 2020 returns. The two extra days are due to May 15 falling on a Saturday.

The IRS is also struggling to wrap up a massive backlog of 24 million tax returns that have lingered since 2019, The Washington Post reports.

To make matters worse, millions of U.S. taxpayers still have not received stimulus checks from the first two packages rolled out during the Trump administration. The IRS is charged with administering the bulk of the funds from these rescue plans, but has fallen woefully behind due to significant lags in processing and other obstacles, including the pandemic and weather, that have slowed down operations, according to the Post.

President Joe Biden signed the $1.9 trillion stimulus into law late last week and $1,400 direct deposits began arriving in millions of bank accounts over the weekend. The payments will continue over the coming weeks. Paper checks or prepaid debit cards will be delivered later by mail.

Some Washington lawmakers fear the large accumulation at the IRS has the potential to inadvertently undermine Biden’s ambitious economic agenda.

“The IRS is in a hole and needs to stop digging,” said Massachusetts Rep. Richard Neal, the Democratic chairman of the House Ways and Means Committee. “It is time to assess what must be done now to deliver the service Americans deserve … It is in the best of all to extend the filing season.”

The IRS recently appeared before the panel and revealed the agency was swamped with work, causing major delays in tax refunds and other aid designed to help struggling Americans amid the unrelenting pandemic. IRS Commissioner Charles Rettig is expected to offer a progress report to the committee again on Thursday.