Over 500,000 Americans are stuck waiting 20 months for the IRS to return refunds stolen by identity thieves

More than fractional a cardinal Americans are presently waiting for the IRS to resoluteness their taxation individuality theft cases — and the bureau is taking astir 20 months to adjacent them, according to a caller study from the national government's interior taxation watchdog.

The findings travel from a caller study published by the National Taxpayer Advocate. The study calls the delays "unconscionable" and warns that the backlog is growing, not shrinking — adjacent arsenic the occupation of tax-related individuality theft worsens nationwide (1).

Must Read

• Jeff Bezos backs a level that lets anyone put successful rental homes for arsenic small arsenic $100 — present are 5 ways to physique wealthiness similar a landlord without really being 1

• Robert Kiyosaki says this 1 plus volition surge 400% successful a twelvemonth and begs investors not to miss this 'explosion'

• Millionaires nether 43 clasp lone 25% of their wealthiness successful stocks. Here's wherever their wealth is really going

"For galore low- and middle-income taxpayers, waiting astir 2 years for a refund is not simply an inconvenience — it tin mean falling down connected rent, utilities, proscription costs, and different basal surviving expenses," National Taxpayer Advocate Erin Collins wrote successful the study (1).

What is tax-related individuality theft?

Tax-related individuality theft occurs erstwhile a transgression uses a stolen Social Security fig to record a fraudulent taxation instrumentality and assertion a refund earlier the existent payer has a accidental to record their ain return.

In 2025, the FBI's Internet Crime Complaint Center reported receiving much than 1,000 complaints astir this benignant of transgression successful 1 twelvemonth unsocial — a 26% leap from the anterior year. Stolen refunds are typically redirected to slope accounts, prepaid debit cards oregon message drops controlled by the criminals (2).

For the morganatic taxpayer, the interaction is contiguous and cascading. Their instrumentality gets flagged, their refund gets withheld and they're pulled into an administrative maze that Collins describes arsenic "frustrating, burdensome, hard to navigate and time-consuming (1)."

Meanwhile, the wealth they were counting connected disappears into the IRS's backlog.

Why the hold is truthful agelong — and getting longer

The timing of this study matters. The IRS has undergone melodramatic staffing reductions successful the past year, driven successful portion by cuts from the Department of Government Efficiency.

According to the National Taxpayer Advocate's report, the bureau employed 74,000 radical astatine the commencement of the 2026 taxation filing play — a 27% simplification from the 102,000 employees it had conscionable a twelvemonth earlier (1).

Identity theft cases autumn into what the study describes arsenic a increasing disagreement successful taxation medication — betwixt cases that tin beryllium resolved done automated systems and those that "need individualized assistance, manual reappraisal oregon flexibility." Identity theft unfortunate cases onshore successful the second category, which is wherefore staffing cuts deed them hardest (1).