Jun 29, 2026
More than half a million Americans are currently waiting for the IRS to resolve their tax identity theft cases — and the agency is taking roughly 20 months to close them, according to a new report from the federal government’s internal tax watchdog.
The findings come from a recent report published by the National Taxpayer Advocate. The report calls the delays “unconscionable” and warns that the backlog is growing, not shrinking — even as the problem of tax-related identity theft worsens nationwide.
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“For many low- and middle-income taxpayers, waiting nearly two years for a refund is not merely an inconvenience — it can mean falling behind on rent, utilities, transportation costs, and other basic living expenses,” National Taxpayer Advocate Erin Collins wrote in the report.
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What is tax-related identity theft?
Tax-related identity theft occurs when a criminal uses a stolen Social Security number to file a fraudulent tax return and claim a refund before the real taxpayer has a chance to file their own return.
In 2025, the FBI’s Internet Crime Complaint Center reported receiving more than 1,000 complaints about this type of crime in one year alone — a 26% jump from the prior year. Stolen refunds are typically redirected to bank accounts, prepaid debit cards or mail drops controlled by the criminals.
For the legitimate taxpayer, the impact is immediate and cascading. Their return gets flagged, their refund gets withheld and they’re pulled into an administrative maze that Collins describes as “frustrating, burdensome, difficult to navigate and time-consuming.”
Meanwhile, the money they were counting on disappears into the IRS’s backlog.
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Why the wait is so long — and getting longer
The timing of this report matters. The IRS has undergone dramatic staffing reductions in the past year, driven in part by cuts from the Department of Government Efficiency.
According to the National Taxpayer Advocate’s report, the agency employed 74,000 people at the start of the 2026 tax filing season — a 27% reduction from the 102,000 employees it had just a year earlier.
Identity theft cases fall into what the report describes as a growing divide in tax administration — between cases that can be resolved through automated systems and those that “need individualized assistance, manual review or flexibility.” Identity theft victim cases land in the latter category, which is why staffing cuts hit them hardest.
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Collins first flagged severe identity theft delays in 2023, when the IRS had a backlog of approximately 484,000 cases taking about 19 months to resolve. The situation has deteriorated since: the backlog now stands at more than 500,000 cases, and resolution times have stretched to 20 months.
Why this hits hardest for lower-income filers
The financial stakes are especially high right now. According to IRS data reported by CBS News, the average tax refund this filing season is $3,462 — 11% more than the prior year, driven by new deductions under President Donald Trump’s One Big Beautiful Bill Act.
For lower-income filers who rely on that money to cover basic expenses, having it withheld for nearly two years can be a serious financial issue. A LendingTree survey of more than 1,500 tax filers found that 46% are depending on a refund this year, up 36% from 2023.
What you can do to protect yourself
The most effective defense against tax identity theft is one the IRS itself recommends: an Identity Protection PIN, or IP PIN. This six-digit number assigned to taxpayers must be included on any return filed using your Social Security number — making it nearly impossible for a fraudster to file in your name without it. A new PIN is generated each year and enrollment is available through IRS.gov.
If you believe you’ve already been victimized, the FBI urges filing a report at IC3.gov as quickly as possible. The IRS will automatically enroll confirmed victims in the IP PIN program.
Separately, placing a credit freeze with all three major bureaus — TransUnion, Equifax and Experian — can help prevent new fraudulent accounts from being opened in your name while the IRS works through your case.
The bottom line: with a 20-month wait and a staffing situation unlikely to improve quickly, prevention is the only tool that actually works on your timeline.
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With a writing and editing career spanning over 15 years, Emma creates and refines content across a broad spectrum of industries, including personal finance, lifestyle, travel, health & wellness, real estate, beauty & fitness and B2B/SaaS/tech.
