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How the IRS Spends 12 Billion on Paper Returns
Episode 90 of The Fiscal Policy Podcast: Lucas and Luna dig into the IRS's $12 billion annual cost to process paper tax returns in 2026. They trace the history of e-file adoption, the persistence of physical forms, and the hidden costs of maintaining legacy infrastructure. With the IRS still relying on 1960s-era Cobol systems and a 2024 Government Accountability Office report finding that 38 million individual returns were still filed on paper in 2025, they explore why digital transformation has stalled. Lucas breaks down the per-return cost difference: $0.22 for electronic filing versus…
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