The IRS Stops Processing Mail: Why Form 990 is Backed Up

Tax-exempt organizations who paper file Form 990 during COVID-19 are subject to serious delays.

During COVID-19, the IRS stopped handling their mail. Your nonprofit’s Form 990 could be one of the thousands of paper tax returns piling up during the IRS office evacuation. If you’ve already filed or are about to, here is what you need to know. 

Why the Delay?

The IRS has scaled back their operations on all fronts, pausing tax collections, leaving phone lines unmanned, and letting some employees work from home. March 26 through all of April, mail applications for tax-exempt status were not processed. The paper filing backup overflowed from IRS facilities to storage trailers.

The World Health Organization reports that COVID-19 can live on paper for 4-5 days. Tax return envelopes could hold the threat of millions of germs, but even after the mail is disinfected, the real danger is that coming to work puts IRS employees in proximity and at risk. 

On our end, nonprofits are being urged to support social distancing and lessen the load by e-filing IRS Form 990.

Should My Organization E-file?

E-filing is always the best way to protect against delays with the IRS. It is part of the response to our current global health emergency, but e-filing is also the new norm for nonprofits. 

Recently, the IRS mandated that tax-exempt organizations file Form 990 electronically. If your tax year started July 2, 2019, or later, or ended after  July 30, 2020, your organization will have to e-file for 2020. Mandatory online tax filing will be kicking in for most organizations in 2021 and will be in full effect for all organizations by 2022.

What if I already paper filed? 

Even if you’re ready to e-file in the future, you may be waiting on a paper filed return right now. If you did paper file, it’s no problem, it will just take a while to be processed. 

Do not resubmit electronically   

Even though paper filing processing is on hold, resubmitting your form online is not the answer. This will result in doubling up on filing and cause problems for your organization. It’s best to just wait it out and e-file next time.

When will my return be processed?

The IRS is in the beginning stages of reopening and employees have been returning to work in some states. There is a huge amount of unopened mail to work through, but the IRS will process your organizations’ paperwork as soon as it is deemed safe. 

If you have not filed yet, file your Form 990 online for the fastest results.

Is any taxpayer correspondence still available? 

Waiting for important paperwork for your organization can be difficult and the first impulse is to ask the IRS for answers. In anticipation of major delays, the IRS requested filers not to contact them about the status of their returns during this time. 

IRS customer service is running at a smaller capacity, but you can still get the support you need. For filing assistance, Express Tax Exempt is IRS certified and specializes in nonprofits. Our support team is U.S.-based and we are happy to help.

Find out more about extended Form 990 Deadlines, relief for your nonprofit during COVID-19, and how to find the correct schedule for your organization.
For all your future Form 990 filing needs, Express Tax Exempt is here for you.

Add a Comment

Your email address will not be published. Required fields are marked *