Tuesday, March 26, 2024

Why Taxes Taking So Long

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Is There A Delay On 2022 Tax Refunds

Heres why your tax refund is taking so long

Last year, many taxpayers ended up waiting longer than the usual 21 days some as long as eight weeks to receive their refunds as the IRS was dealing with the backlog of returns caused by the COVID-19 pandemic.

The IRS is still working through this backlog of 2020 tax returns. Because of this, many tax experts expect that some refunds will be delayed this year.

Computation Errors On The Tax Return

The U.S. tax code can be complicated, with numerous exceptions, special circumstances, and phase-outs of deductions and credits.

“It’s no surprise that manually prepared returns frequently include math errors,” Holland notes.

Some of the most common calculation errors include the taxable amount of Social Security income, taxable income, and the Child and Dependent Care Credit. Errors in the amount of taxes withheld, estimated taxes paid, the Earned Income Tax Credit or the increased standard deduction for certain taxpayers also frequently result in computation errors on a tax return.

Tax preparation software like TurboTax, which automatically runs required calculations, can help you avoid math errors on your return. TurboTax also checks for errors and calls them to your attention before you file.

Can I Call The Irs To Get Answers

While you could try calling the IRS to check your status, the agency’s live phone assistance is extremely limited.

The IRS is directing taxpayers to the Let Us Help You page on its website and to get in-person help at Taxpayer Assistance Centers around the country. You can contact your local IRS office or call to make an appointment: 844-545-5640. You can also contact the Taxpayer Advocate Service if you’re eligible for assistance by calling: 877-777-4778.

Though the chances of getting live assistance are slim, the IRS says you should only call the agency directly if it’s been 21 days or more since you filed your taxes online, or if the Where’s My Refund tool tells you to. You can call 800-829-1040 or 800-829-8374 during regular business hours. If you have not received a refund yet, you shouldn’t file a second tax return.

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When Should I Call The Irs

Taxpayers hoping to get a person on the phone will face an uphill battle. The agency last year answered only 1 in 9 phone calls, with an average hold time of 23 minutes, according to the National Taxpayer Advocate.

The IRS says taxpayers should call about their refund in just a few circumstances:

  • When it has been longer than 21 days since the return was electronically filed.

  • When it has been six weeks or more since the return was mailed.

  • If the “Where’s My Refund?” tool instructs someone to contact the IRS.

Worries Build Among Families And Friends Who Filed Paper Returns

Why Are My Taxes Taking So Long

The anxiety has been huge the last few months for those who filed paper returns in 2022.

JoAnn Marino, of Washington Township, began worrying when a few family members called her saying they did not get their federal income tax refunds yet theyre OK with the State of Michigan when she filed paper returns for them back in early April.

A nephew is getting married in November and fears that he wont get an estimated refund of around $3,600 in time to cover some of those big wedding bills.

His sister is expecting a tax refund of around $1,000 and could use the extra cash now to cover some down payments for a wedding next year.

She retired during the pandemic from her job in financial services and figures she can take up to 12 hours or so early in the year to prepare tax returns for her family, including her mother. Most of them have pretty basic returns she uses a CPA for her own return.

Theyre young, single, she said of some family members. My nephew doesnt even own a home.

Weve always filed some of them by paper and its never been an issue, she said. All of the e-filed returns have been processed.

The IRS doesnt post information for paper returns at Wheres My Refund? until those returns are processed. Wheres My Refund? does not explain any status delays, reasons for delays, where returns stand in the processing pipeline, or what action taxpayers need to take, according to the National Taxpayer Advocates report.

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Options For People Expecting A Faster Refund

If you were counting on a tax refund by April or May, you may be anxiously awaiting your return and wondering if there are other options to access necessary funds.

Ideally, its best to be patient and hold out for your refund for as long as you can. People need to allow more time for their return to be processed and plan for delays, says Benjamin Peeler, partner-in-charge of IRS tax controversy services at Eide Bailly, a Fargo, North Dakota-based certified public accounting and business advisory firm.

There arent real options to push a refund sooner and there are even fewer options than there were before the covid delays with the IRS, he says.

You may be able to get a tax refund advance, but examine your budget to see if taking out a loan is your best option. You should plan on budgeting extra money for any fees and the interest you will be paying, depending on how long it will take for you to repay the loan and when you will receive your tax refund.

While many tax preparers such as H& R Block and Jackson Hewitt offer loans or advances with favorable termsincluding not charging for loan origination fees or interest if they prepared your tax returnmost of these programs deadlines occurred mid to late February and are no longer available, says Daniel Fan, senior managing director and head of wealth planning at First Foundation Advisors in Irvine, California.

How To Prevent Refund Delays Next Year

The key to getting your refund as quickly as possible is filing online if possible. Avoid filing a paper return by mail as these generally take longer to process.

If you qualify, or if you feel confident manually filing your taxes, consider filing online either through the IRS Free File or Free File Fillable Forms. When you file online, you will receive a quick confirmation that your return was either accepted or rejected. The email confirmation often occurs in just a few minutes. You can also enter your bank account information to receive a direct deposit of your refund or make a payment online.

When you file your return, avoid guessing on amounts reported by third parties such as banks, stock accounts, health insurance payments or mortgage interest, Peeler says. Instead, obtain the exact amounts by checking your account online or from the paperwork sent by these companies. For instance, mortgage lenders send out statements giving the exact amount of interest you paid on your loan.

Having mismatched amounts will cause a delay in your refund even if you understated the amount of a deduction.

These mismatches can trigger CP2000 letters or requests for more information on letter 2626C, Peeler says. If you miss these letters and dont provide the additional information, your return could be shelved until they get a response.

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How To Pay Bills While You Wait For Your Tax Refund

Because tax refunds can be delayed for a number of reasons, the IRS cautions taxpayers not to rely on receiving their tax refund within three weeks in order to cover expenses or make an important purchase.

Here are some ideas for getting by while you wait for your refund check.

  • Adjust your 2022 withholding or estimated taxes. Receiving a tax refund means you’ve overpaid your taxes. If the same thing is likely to happen for the 2022 tax year, you may be able to reduce your withholding or estimated tax payments. You won’t receive a lump sum of cash next year at tax time, but you might increase your take-home pay. Try using the IRS Tax Withholding Estimator or check with your tax preparer before making any adjustments. If you’re self-employed, try refiguring what you pay in quarterly taxes.
  • Why Is Your Tax Refund Taking So Long Here Are Some Possibilities

    E239 Why Does Probate Tax Clearance Take So Long?

    Many different factors can affect the timing of a refund after the IRS receives a return. A manual review may be necessary when a return has errors, is incomplete or is affected by identity theft or fraud.

    Even though the Internal Revenue Service issues most refunds in less than 21 days for taxpayers who filed electronically and chose direct deposit, some refunds may take longer.

    Many different factors can affect the timing of a refund after the IRS receives a return. A manual review may be necessary when a return has errors, is incomplete or is affected by identity theft or fraud.

    Other returns can also take longer to process, including when a return needs a correction to the Child Tax Credit or Recovery Rebate Credit amount, includes a claim filed for an Earned Income Tax Credit or an Additional Child Tax Credit, or includes a Form 8379, Injured Spouse Allocation , which could take up to 14 weeks to process.

    The fastest way to get a tax refund is by filing electronically and choosing direct deposit. Taxpayers who dont have a bank account can find out more on how to open an account at an FDIC-Insured bank or the National Credit Union Locator Tool.

    The IRS will contact taxpayers by mail when more information is needed to process a return. IRS phone and walk-in representatives can only research the status of a refund if it has been:

    2020 tax returns

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    Why Is My Amended Tax Return Taking So Long

    Amended Return taking FOREVER Intuit

    • Amended Return taking FOREVER. Its happening because the IRS is currently not processing any tax returns that are filed by mail, which includes all amended returns, because of the Covid-19 pandemic. When they start to process them again they will have reduced staff and a big backlog, so it will be a long time before your fiances amended return is processed, or even shows up on Wheres My Amended Return.

    Reason #2 Irs Holding Your Refund

    The IRS can hold your refund and request more information from you in several situations. This doesnt mean youre being audited but it can lead to one if you dont respond with all the information by the deadline.

    Here are six of the most common situations when the IRS can hold your return:

    You mailed in your return, and the IRS flagged a math error:

    When taxpayers e-file their returns, the e-file process catches many return errors and rejects the returns at the time of filing. If you mail your return instead of e-filing it, the IRS is more likely to identify an error after the fact.

    The IRS calls most of these errors math errors, but they arent limited to arithmetic mistakes. If your Social Security Number or your dependents information doesnt match IRS records, the IRS can change any related deductions or credits . The IRS can also change your return if you forget to include a corresponding schedule or form to support a deduction or credit.

    If the IRS changes your return, youll get a letter asking you to correct the error within 60 days. If you dont provide enough explanation and information, the IRS change is final. At that point, you would have to amend your return and follow up with the IRS to get your refund.

    The IRS suspects identity theft:

    The IRS is challenging tax credit you claimed:

    The IRS identified potential ACA health insurance issues:

    You need to file an old return:

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    So What Can You Do If Your Tax Refund Is Taking Much Longer To Get Than Expected

    There are two main categories that cause your tax refund processing to taking longer than expected. Either something is wrong with your tax return filing, e.g. missing information, additional identity fraud/verification, incorrect social security numbers etc or income information from related sources do not add up.

    For example same dependent claimed in multiple tax returns. So here are a few things you can do to try and figure out why your tax refund is so taking so long to get to you.

    • Check the IRS tax tool, wheres my refund or IRS2Go mobile app, to get the official status of your refund . It is updated daily and provides the latest processing status of your tax refund. The IRS has announced that it expects to issue more than 90% of refunds to taxpayers in less than 21 days . So even if you have submitted all your documents you probably need to wait for at least 21 days before taking on more drastic actions. And if you paper filed, you may need to wait more than 6 weeks before hearing back from the IRS.
    • Get online help from various articles on people seeing delays with their refunds. On one of my articles covering the IRS refund schedule I got 6000+ comments, with the following useful real life tips you wont find elsewhere:
    • Hire an accountant or tax services firm to follow up this issue on your behalf particularly if you have a tax obligation to the IRS. But be warned, these are not the cheapest options and if you refund is less than $1,000 it may not be worth the cost.

    Irs Tax Refunds Delayed: Why Are Refunds Taking So Long

    How to File Your Taxes

    There are a variety of reasons, including the IRS’ backlog, but it could be down to an error in your tax return

    It is tax season in the United States and that means that many people in the country are not far away from receiving a tax refund, with three in four Americans receiving a tax refund from the IRS each year.

    However, it is thought that there could be a similar situation to what roughly 30 million taxpayers experienced last year, as they had a delay with regard to receiving their tax refund.

    The IRS began to process tax returns on January 24, 2022, and officials from the Treasury Department have already warned that there will be challenges along the way, thanks in part to the backlog of returns from last year.

    In fact, on December 31, 2021, the IRS still had six million unprocessed individual tax returns, and while it’s worth noting that the backlog was as high as 30 million in May 2021, the six million figure is still higher than the usual figure of one million for this time of year.

    Read Also: Can You Get An Extension On Your Taxes

    How Long Will It Take To Get Your Refund

    General refund processing times during filing season:

    • Electronically filed returns: Up to 4 weeks
    • Paper filed returns: Up to 8 weeks
    • Returns sent by certified mail: Allow an additional 3 weeks

    The Wheres my Refund application shows where in the process your refund is. When weve finished processing your return, the application will show you the date your refund was sent. All returns are different, and processing times will vary.

    See how our return process works:

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    When Are Taxes Due

    For most years, the deadline to submit your tax return and pay your tax bill is April 15. However, taxes for 2021 were required to be filed by April 18, 2022, due to a legal holiday in Washington D.C. Residents of Massachusetts and Maine had until April 19, 2022.

    For those that were unable to meet the tax filing deadline for the year, there was an option to file for a six-month extension. This would put your extension deadline to file your taxes at October 17, 2o22, but the sooner you file, the sooner you can receive your tax refund.

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    Will My Amended Return Ever Be Processed

    Checking the status once you file an amended tax return The IRS states that it can take up to three weeks for the amended return to even appear in their system. Then they say it can take up to 16 weeks to process the amended return. However, due to the pandemic, the processing time is closer to 6 months or more.

    An Incomplete Tax Return

    Why is my direct deposit tax refund taking so long?

    The first reason and the most common is that people tend to submit incomplete or inaccurate information on their tax returns.

    Many people wait until the last minute to do their taxes, and they have to rush through the process.

    This generally results in inaccurate bank or address information and incomplete forms.

    Read Also: How To File Quarterly Taxes Online

    Return Delayed Heres What To Do

    If youve been waiting on your tax refund and you feel in the dark, your first response might be to call the IRS directly. However, this is rarely recommended.

    Youre likely to find yourself on the line a long time before you reach a real person, and then theyll just direct you to use Wheres My Refund? Save time, and blood pressure, and avoid calling the IRS unless directed to.

    The Wheres My Refund? tool is the best choice for checking the status of your refund. You can use this within 24 hours of e-filing your tax return, or within 4 weeks of mailing a paper return.

    Wheres My Refund? will require your Social Security number or ITIN, your filing status, and the exact refund amount.

    Wheres My Refund? updates daily, typically overnight, to provide you with the latest information regarding your tax return.

    Alternatively, the IRS offers a mobile IRS2Go app. This works similarly to Wheres My Refund?, allowing you to check the status of your return daily.

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