IRS data from the fifth week of the tax filing season—the week ending February 28, 2025—continues to suggest that taxpayers are not excited about filing this tax season. Numbers for tax filing and processing of tax returns remain low, a mark that has not changed throughout the filing season.
Filing and Processing Dips
Early filing data reflects a continued downturn in tax returns received compared to the prior year. The dip is 3.0% compared to last year (and almost 10% down from the same filing period in 2023).
As I noted last week, the IRS has apparently given up on excuses. After weeks of offering an explanation for the lower numbers, explaining that the agency “expects the tax return filing numbers will level out in future weeks as the April filing deadline approaches,” the IRS didn’t offer any such platitudes this week (or the last).
The IRS is currently operating on its third Commissioner in as many months—Melanie Krause is now the acting IRS Commissioner following the resignation of former Commissioner Danny Werfel and retirement of acting Commissioner Douglas O’Donnell. A Trump Administration hiring freeze at the tax agency has begun, with existing job offers being rescinded. Thousands of workers have been eliminated from their positions, with additional cuts—reportedly up to half of the agency’s full-time staff—on the way. And after Elon Musk announced that he had “deleted” Direct File, some taxpayers assumed that the free filing option was no longer operational (it is). And taxpayers have voiced concerns about the privacy their financial data after reports surfaced that Musk’s Department of Government Efficiency (DOGE) requested access to sensitive taxpayer data at the IRS.
The changes have resulted in confusion for some taxpayers, and apathy for others. (I’ve had more than one conversation with taxpayers this week suggesting that they believe there will be no consequences for not filing or not paying.) […]
— Read More: www.forbes.com
