Stories of IRS ineptitude are a dime a dozen, although — admittedly — some are more impressive than others. I’m still reeling from the revelations of a couple of weeks back that the Service paid out on fraudulent claims for the homebuyer tax credit to more than 1,300 prison inmates — and at least 34 IRS employees.

So it’s something of a break from routine to learn that companies can be just as inept in navigating newly minted tax regs as the IRS is in enforcing them.

Second-quarter returns are starting to trickle in to the agency, and a fraction of them claim the payroll tax breaks offered under the Hiring Incentives to Restore Employment (HIRE) Act. But some companies are struggling with the paperwork. An article from BNA Software relates this complaint from Joseph Tiberio, acting chief for employment tax at the IRS:

“A number of returns have come into IRS with dollar amounts filled in on lines that require the employer to enter the number of qualified employees for the new-hire retention tax credit and the payroll tax exemption. … This issue is more problematic than other mistakes the IRS has noticed, such as math computation and employer identification number transposition errors.”

A dollar amount on a number line? C’mon guys, how hard can this be? True, the IRS’s three pages of FAQs on the exemption are not exactly light summer reading, but they’re not quantum physics either.

Meanwhile, a U.S. Treasury report today claims that the HIRE Act is “helping to fuel a private-sector-led recovery.” Businesses will be eligible for some $8.5 billion in exemptions for an estimated 4.5 million new workers hired from February to May this year.

Of course, whether those workers would have been hired anyway is a moot point.

And, how many companies will be able to get their act together to claim the exemption remains to be seen. ###