On The Money: IRS faces 35 million unprocessed tax returns | Robinhood to pay record $70 million settlement

On The Money: IRS faces 35 million unprocessed tax returns | Robinhood to pay record $70 million settlement
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THE BIG DEAL — IRS ended filing season with 35M unprocessed tax returns: The IRS ended this year’s filing season with more than 35 million individual and business tax returns that have not yet been processed, according to an independent watchdog report released Wednesday. 

  • The report, conducted by the National Taxpayer Advocate's office at the IRS, found that while most taxpayers were able to successfully file their returns and receive refunds, a record number of Americans did not. 
  • The number of unprocessed tax returns is more than four times greater than the number recorded at the end of the 2019 pre-pandemic filing season. 
  • This includes 16.8 million paper tax returns waiting to be processed, 15.8 million that were suspended during processing and require further review, and roughly 2.7 million amended returns that still need to be processed, according to the report. 

The Hill’s Celine Castronuovo has more here.

LEADING THE DAY

Robinhood to pay record $70 million settlement with regulator: A financial industry regulator Wednesday ordered Robinhood Financial to pay nearly $70 million in fines and restitution to customers harmed by regulatory lapses and inaccurate information.

Robinhood will pay $57 million in fines to the Financial Industry Regulatory Authority (FINRA), a self-regulatory agency for brokerage firms, and $12.6 million in damages to thousands of customers. It is the largest penalty ever levied by FINRA, the regulator said.

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The allegations: 

  • FINRA alleged that since 2016, Robinhood frequently provided customers with incorrect information about the net value of their investments, the amount of risk they had taken and whether they could be required to put up more cash for their current positions.
  • FINRA also alleged that Robinhood allowed thousands of customers who did not meet the company’s requirements or should not have been approved for other reasons to trade options, which are generally riskier and more complicated than stocks.
  • Robinhood additionally failed to adequately supervise the technology needed to process basic customer orders, FINRA alleged, leading to several outages that locked customers out of their accounts. 
  • The company also allegedly failed to report tens of thousands of customer complaints to FINRA.

I break down the historic sanction here

Anticipation of possible Trump Organization indictments builds: Former President TrumpDonald TrumpUN meeting with US, France canceled over scheduling issue Trump sues NYT, Mary Trump over story on tax history McConnell, Shelby offer government funding bill without debt ceiling MORE's inner circle and legal experts are bracing for the political and legal fallout of charges being filed against his company as soon as Thursday.

What it means for the former president: Trump is not expected to face charges personally, but there is still some concern within his circle about the consequences. Multiple sources said there has been chatter among aides in recent days about the looming announcement out of New York, though most do not believe it will impact Trump and his political operation at this point. The Hill’s Brett Samuels has more here.

GOOD TO KNOW

ODDS AND ENDS