Current Refund Delays – Possible Explanation

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Well, don’t know if this is going to make sense to anyone but me, or what good it does to understand why the system failed, because we all just want our refunds, but here’s my take.

There has to be a reason why so many returns got sent to ERS. Could be as the Washington Post reported, because the IRS was buying time due to issues with the 3rd stimulus. But I am inclined to think a programming glitch (probably centered around the stimulus payments) sent all these returns (estimated over 7 million) to ERS.

So we’ve been seeing code 900 and I’ve seen some code 100. The one that stuck out was code 245, which is a management suspense code.

Management Suspense Action Codes
“Management may direct that certain records will be held to await further processing instructions.
Some reasons for suspension are in the following list:

A Submission Processing Campus computer program bug exists for a particular type record.
Master File programs are not yet available or are incorrect for a specific type record.
Legal or administrative complications exist that indicates this specific type of record should not be processed.”
(This would be the code 245)

According to the manual

https://www.irs.gov/irm/part3/irm_03-012-037r#idm140557101650800

1. The real-time portion of the Error Resolution System has a capacity of approximately 400,000 Form 1040 records per campus.
(a) Up to 30,000 records may be retained on the Quality Review File, so the effective capacity for real-time planning is 400,000 records.
2. An ERS inventory threshold has been established where up to 50,000 records are automatically added to the error file. This would happen only if the entire workable suspense file had been worked.
(d) No inventory will be automatically added to the system if the threshold will be exceeded unless a selection is made.
(You can read the entire process dealing with what happens when thresholds are exceeded at the link provided)

Codes 100 and 900 deal with this process
100 Unworked error record
900 Unselected inventory waiting to be loaded from the ERS01 File prior to selection for the real time ERS System

So in short, there was a glitch, so the system sent the returns to ERS. The system is COMPLETELY backlogged (aka broken) and cannot process the overflow of returns.

If you continue reading on that link the manual further states that there will be no record of these returns while in this status.
“In overflow status, the record is not accessible with any command code or included on any inventory list.”
This would explain N/A on all these transcripts with “no return filed” listed. (My return included :(

To me, it’s simply a matter of
1. Fixing the initial glitch which I truly believe is related to the stimulus payments – I believe the system flagged the returns as being posted for an incorrect year, which will send the returns to ERS.
2. Expanding the allowable returns that can be in ERS, which again is a computer coding issue.

For the sensitive data and sheer volume of returns the IRS processes, I would like to believe their IT department would be top notch. This definitely does not appear to be the case. These seem to be issues that could have been fixed so that the problem isn’t as massive as it is now, if someone would connect the dots concerning the cause and effect of these returns. Let’s hope the IRS at least knows how to connect those dots :)

I like when I can explain why something went wrong. It doesn’t change the fact it went wrong, but at least it can be avoided in the future.

[filenwaitnwaitnwait]

Clarification: I said I believe the system flagged the *returns as being being posted for an incorrect year…”
I meant to say the system flagged the *stimulus payments/credits. It’s probably the filing of the returns that set the ball in motion because the stimulus payments were coded wrong last year, so when the returns were filed, the system “saw” a discrepancy and sent them to ERS. Since ERS isn’t programmed to handle that many returns, we have no refunds

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