Effect of Unprocessed Prior Year Return

[Uncle Sam]

Are taxpayers whose 2020 tax returns are filed but unprocessed as of 2021's filing time, supposed to wait until 2020 is processed or just file anyway?
Reason for asking is - if client has a credit, loss, or tax overpayment carryover from 2020 that hasn't been processed yet - if claimed on 2021 return - will that automatically trigger
IRS correspondence for discrepancy? Or must the client taxpayer wait until 2020 return is IRS processed before filing 2021?

[Lion]

The question of the day!

[TAX4US]

I have several in that quandary with c/o of refunds. I supposed I could hold off on 2021 until 2020 is done but long will that be?

[Lion]

Gal who verified her identity today was told 9 weeks to process her original return. (I've heard 40 weeks for amendments.)

[New York Enrolled Agent]

Are taxpayers whose 2020 tax returns are filed but unprocessed as of 2021's filing time, supposed to wait until 2020 is processed or just file anyway?
Reason for asking is - if client has a credit, loss, or tax overpayment carryover from 2020 that hasn't been processed yet - if claimed on 2021 return - will that automatically trigger
IRS correspondence for discrepancy? Or must the client taxpayer wait until 2020 return is IRS processed before filing 2021?

Nobody knows - File it and let us know what happens.

[Snaggletooth]

I have a couple people that are in this exact situation. I've been told by others that the IRS will turn over to collections if they don't have a record of payment. And they won't have a record unless they process the return. If this happens, I'm going to recommend they contact their congressman. Congress is the cause of all this mess anyway.

[Maribeth]

We have the same problem with the 941X's not getting processed. Therefore the ERC's are not being carried forward. We have been filing each subsequent 941 showing the credit coming forward, and then when the taxpayer gets the notice from the IRS, we have been responding to that notice, and adding to the paper blizzard that the center's currently have. We have had success with one client when we were able to get through on the practitioner's hot line. But that was definitely an exception.