Well, that’s one way to get rid of a backlog.
The IRS, in its desire to reduce the amount of paperwork that it must process, did something extremely stupid. Well, maybe not extremely stupid, but pretty damned close.
It seems that in March (2021), the IRS literally destroyed some 30 million 1099’s, 1098’s and even some W2’s. It’s logic? Folks will still report that income to the IRS, so there was no need to verify if it were correctly reported.
And, the IRS’s response when called out about this stupidity? They plan to implore more taxpayers provide this information electronically, so they won’t have such a paper backlog.
Moreover, the IRS says this was a justified decision since the tax year was almost over and they wouldn’t have been able to process the documents, since the system has be reprogrammed each year to handle those returns.
You do note that the IRS did not notify the world that they destroyed these documents for a full year. I’m guessing that delay was so that taxpayers wouldn’t know that the IRS no longer had copies of those forms (that were never entered into its database) that listed income received. So, they’d properly report their income.
Because you can bet had the IRS notified the world that they were destroying those information returns, a fair number of folks would never properly report the 1099 income they received. They’d be betting that they’d never be caught, since the IRS no longer had any record of that received income.
As a result of this ridiculous act, there is a hue and cry among tax preparers that Charles Rettig (the IRS Commissioner) either resign or be fired.
What think you?
