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The IRS’s Inability to Keep Pace with Non-Corporate Applications for Refund of Net Operating Losses Under the CARES Act Has Cost Taxpayers Millions of Dollars in Additional Interest

Report Information

Date Issued
Report Number
2022-36-048
Report Type
Audit
Special Project
Pandemic
Special Emphasis
Coronavirus Aid, Relief, and Economic Security Act (CARES Act) and COVID-19 Related Audits
Joint Report
Yes
Participating OIG
Treasury Inspector General for Tax Administration
Agency Wide
Yes (agency-wide)
Questioned Costs
$0
Funds for Better Use
$0
View Report

Recommendations

Devote additional resources to process the tentative refunds faster and reduce interest payments.

Develop contingency plans, specific to the processing of Forms 1045, so that taxpayers are not adversely affected by a future cessation in operations.

Develop contingency plans, specific to the processing of Forms 1045, so that taxpayers are not adversely affected by a future cessation in operations.

The Commissioner, Small Business/Self-Employed Division, and the Commissioner, Wage and Investment Division, should evaluate and update their compliance strategy associated with the CARES Act to determine if it matches the risks associated with reversing TCJA provisions.
Rejected recommendation