Each year, hundreds of thousands of taxpayers are victims of tax-related identity theft. In Fiscal Year (FY) 2022, the IRS had 228,383 Identity Theft Victim Assistance (IDTVA) case receipts, and in FY 2023, they increased to 294,138. This increase resulted in part from the issuance of pandemic-era credits such as Economic Impact Payments, the Additional Child Tax Credit, and the Advance Child Tax Credit, which led to the IRS having a backlog of IDTVA cases. It has been four years from the onset of the pandemic, and the IRS’s delays in helping victims are unconscionable. The IRS has prioritized other service areas, such as processing a backlog of paper-filed returns and achieving an 85 percent Level of Service on its main toll-free lines, to demonstrate its success, while identity theft victims continue to experience extreme processing timeframes to get their refunds.

The IRS’s failure to reduce these timeframes further harms victims who are often dealing with other issues related to the identity theft. These taxpayers won’t receive their federal tax refunds until the IRS resolves their IDTVA cases. These delays are particularly challenging for low-income taxpayers who may rely on these refunds to pay their day-to-day living expenses or expenses accrued throughout the year, such as medical bills. IRS delays in issuing refunds may force some taxpayers to reduce their food expenses, leading to food insecurity. In addition, these identity theft victims may struggle to secure certain kinds of loans, such as mortgages.