This year, the IRS has refunded almost 22 million Americans. Filing electronically and using direct deposit are recommended to get your refund faster. If you do, the IRS estimates a 21-day refund.
Even if you do everything correctly, the IRS may not pay you. The three-week estimate may be correct for most taxpayers, but many variables can delay your refund.
Here are a few reasons why your IRS refund may be delayed this year. See how to track your refund to your bank account or mailbox, and register an online IRS account. We’ll keep you posted.
Is your tax return erroneous or
When filing your taxes, double-check all information to ensure it’s correct. Don’t mix up state and federal taxes withheld. Before sending your taxes to the IRS, double-check for errors and make sure you’ve filled out every field.
Also, if you received child tax credit payments last year, verify the amount on Letter 6419. If you enter an inaccurate amount, the IRS will need to review your return, causing an “extensive wait.”
If an error occurs after you file your return, the IRS will attempt to correct it without notifying you. That means you may not notice an issue for days or weeks.
If you owe the IRS
If you owe back taxes to the IRS, the government may seize a portion or all of your refund. If your return is larger than your debt, you’ll get the difference via direct deposit or cheque, but it may take a while.
The IRS should send a CP49 warning to taxpayers whose refunds are utilized to fulfill previous payment obligations.
In some cases, the IRS can keep your tax refund even if you owe other state or federal agencies.
The Treasury Offset Program allows the IRS to use your tax refund to pay child support, state taxes, or unemployment compensation. These debts might delay or destroy your remaining tax refund.
Your bank details are wrong
Have you moved your bank accounts since you last filed? If so, pay particular attention to the direct deposit details this year.
If you neglect to update it with your new direct deposit information, the IRS will return your refund. A paper cheque will be mailed to your address, which may take several weeks.
You used paper to file.
Using electronic filing and direct deposit will help people collect their refunds faster this year. It may take a while for the IRS to receive your return and issue a paper check due to mail delays.
The IRS says filing your return online rather than by mail is critical this year to prevent refund delays. Instead of a paper return, try one of these free online tax filing services to get your refund faster.
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You claimed a child tax credit or earned income credit.
If you filed your taxes in January and claimed the child tax credit or earned income credit, your refund is due in mid-February. This gives the IRS more time to prevent false returns.
The IRS anticipates most taxpayers claiming these benefits to get their refunds by March 1.
The IRS suspects ID fraud.
If the IRS suspects identity theft on a tax return, it will hold your refund until your identity is verified. If that happens, expect a 5071C letter with instructions for verifying your identification.
Do not fear if your tax return is valid; an IRS letter does not prove identity theft, only a suspicion.
Taxpayers can either create an ID.me account or contact a dedicated phone number indicated on the IRS letter to verify their identity. If none of those work, you’ll need to visit an IRS office in person.
Create an “Identity Protection PIN” (IP-PIN) to minimize delays caused by identity theft. This six-digit ID prevents anyone else from filing a return in your name.
If you want the same level of identity security next tax season, you’ll need to create a new IP PIN. If you don’t have an ID.me account, you can get an IP PIN by filling out IRS Form 15227 (PDF) and calling or visiting a local IRS office.
Your return needs more work.
As stated previously, if the IRS needs more time to analyze your tax return, your refund will be delayed. For example, a CP07 Notice says the IRS has received your tax return and is holding your refund pending further examination.
This notice may arrive if you claim treaty benefits or deductions on Schedule A (PDF).
If the agency finds no concerns, your reimbursement could arrive in six to twelve weeks. If the IRS finds errors on your return, it will notify you and give you a deadline to correct them. That implies you’ll get your return months later.