A taxpayer whose identity was stolen and used to file a fraudulent tax return waited 20 months, on average, for the Internal Revenue Service to resolve the case and release a refund, a new federal audit found. The finding comes from the Treasury Inspector General for Tax Administration, the independent office that audits IRS operations, in a report released September 21. For someone counting on that refund to cover rent, a car repair or a semester’s tuition, 20 months is not an abstract statistic; it is more than a year and a half without money the IRS has already agreed is owed. The report traces, case by case, why that wait has stretched so long and grown so hard for any one taxpayer to predict.
Inside the IRS’s Identity Theft Victim Assistance Work
The office doing this work is the IRS’s Identity Theft Victim Assistance function, which steps in once a taxpayer reports that someone else filed a return using their Social Security number, or once the IRS’s own fraud filters flag a return as suspicious before the real one arrives. Before that taxpayer’s genuine refund can move, an IRS caseworker has to confirm which return is legitimate, unwind whatever the fraudulent filer claimed, and correct the account before any money goes out the door. The Treasury Inspector General for Tax Administration’s September 21 report found that from fiscal year 2023 through fiscal year 2025, taxpayers caught in this process waited 20 months on average before the IRS finished that work. That figure spans three full budget years rather than one unusually bad stretch, and it comes from the IRS’s own case files rather than from a survey of taxpayers trying to recall how long a wait felt.
Inside the kit: A notice decoder and a refund status tracker spreadsheet are built for a case sitting in the identity-theft queue, where each new notice can mean something different from the last one. Open The IRS Refund Recovery Kit to match a notice to what it actually requires next.
What a 20-Month Wait Does to a Household Budget
Many identity-theft cases involve a refund built around the Earned Income Tax Credit or the Child Tax Credit, benefits aimed at working families raising children, which means the money on hold is often larger than an average refund and more likely to already be spoken for. A 20-month wait can stretch across two more filing seasons on top of the one in dispute, so a household can end up owed money for one year while trying to file the next one correctly, sometimes without a transcript the IRS will release cleanly until the identity issue clears. The IRS kept publicizing its identity-theft defenses while this wait built: on September 4 the agency’s newsroom urged taxpayers to strengthen their defenses against tax-related identity theft, the same season the audit behind this report was tallying how long a case takes once that theft has already happened to someone. That contrast between prevention messaging and processing reality is part of what the audit measured: not whether identity theft happens, but how long it takes the agency to finish cleaning one up once it has.
A Shrinking Caseload, a Widening Wait
The audit’s own numbers point to an odd pattern. The IRS’s identity-theft inventory actually shrank over the three years measured, ending fiscal year 2023 at 485,313 open cases, fiscal year 2024 at 473,608, and fiscal year 2025 at 315,740, even as the average time needed to close a case ran to 20 months. A smaller pile of cases did not translate into a shorter wait for the people still inside it, which points to a slowdown built into how each case gets worked rather than one caused simply by the size of the backlog. The same report shows the IRS closing cases faster than new ones came in, without closing any one case meaningfully faster than before.
Where the Paper Trail Broke Down
The report also found real gaps in how the IRS kept affected taxpayers informed while their cases sat open. TIGTA identified roughly 50,000 identity-theft cases closed in fiscal year 2023 in which the IRS sent the taxpayer no correspondence at all during the life of the case, and found that required acknowledgment letters went out on time in only about 29 percent of the cases it reviewed. A taxpayer with no letter and no clear status update has no way to know whether a case is moving, stalled, or waiting on something only the IRS can see, which turns a long wait into a confusing one as well. The gap matters most to someone trying to plan around the refund, since a case with no update looks identical from the outside whether it is a week from closing or a year away.
What the Inspector General Recommended
TIGTA’s report closed with three recommendations for improving how the IRS handles these cases, and IRS management agreed with two of them while disagreeing with the third, according to the same report. The Treasury Inspector General for Tax Administration published the finding as one of two audit reports it issued on September 21, alongside a separate review of a different IRS function, part of the office’s regular schedule of independent checks on how the agency runs its own programs. Until the IRS acts on the recommendations it accepted, the 20-month average stands as the office’s own measured account of what an identity-theft case costs a taxpayer in time.
A Stalled Identity-Theft Case and the Paper Trail Around It
A 20-month average wait on an identity-theft case leaves a household without its refund for well over a year, and the audit gives no household a personal timeline for its own case. Every notice, extension letter and document request that arrives during that wait has to be read and answered correctly, and a single missed response can add months to an already long case.
The IRS Refund Recovery Kit includes a notice decoder and a refund status tracker spreadsheet, built for logging each notice a stalled case produces and what it actually asks a household to do.
See the notice decoder in The IRS Refund Recovery Kit.
This article was produced with AI assistance and reviewed by a human editor. Every figure here is linked to the audit that reported it.
