Identity theft victims wait an average of 20 months for the IRS to resolve their cases
A watchdog found 315,740 cases still open and $124 million paid in interest on delayed refunds. Once a person picks up a case, it is usually solved fast.
The US Internal Revenue Service takes an average of 20 months to process an identity theft case, according to a report by the Treasury Inspector General for Tax Administration (TIGTA), FedScoop reported. Tax identity theft happens when someone uses another person's name and taxpayer number to file a false return and claim the refund.
Cases at the IRS's Identity Theft Victim Assistance unit almost quadrupled in fiscal 2021, largely because of the pandemic, and five years on remain "significantly elevated" because fraud has become more common and more sophisticated. The unit began fiscal 2025 with 473,608 cases and ended it with 315,740.
Long waits, real costs
The IRS aims to resolve claims within 120 days. In a sample of 114 cases closed in fiscal 2023, auditors found only four closed within that time; the average was 655 days. "These lengthy delays can frustrate and burden taxpayers while they wait to receive their refunds," the report said. Between fiscal 2023 and 2025 the IRS paid about $124.2 million in interest on delayed refunds.
The bottleneck is the queue
The report found a striking contrast. Once a case reached an assistor, it moved quickly: 54 per cent of self-reported identity theft cases were resolved within 30 days of assignment, and some on the same day. The delay is in waiting to be picked up, not in the work itself.
TIGTA recommended that the IRS assess each case's complexity on arrival and assign simpler ones faster. The agency agreed.
The finding echoes a wider truth about public services. Victims of fraud are often told to wait while their case sits in a queue that no one is working. Triage, sending easy cases straight to someone who can close them, can shorten the wait without extra staff.
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