Common Misconceptions about Tax Refunds

 In Monikanomics

I could not tell you how much my phone rang this year with clients asking were their refund was or that they went online to check their refund status only to find out their return had yet to be processed.  It did not matter what I said, or the proof I sent over, I could tell they still did not believe.

Per the Internal Revenue Service, the following are some key facts to help you better understand the refund process better:

  • Electronically filed returns and those that use direct deposit can expect their refunds faster than those that file a paper return, especially since the COVID-19 outbreak has reduced the IRS staffing.
  • Taxpayers that file a paper return are more likely to expect delays.
  • The easiest way to check on a refund is Where’s My Refund?
  • You can find Where’s My Refund on the irs.gov or IRS2Go mobile app
  • The refund status can be checked within 24 hours after the taxpayer receives the e-file acceptance notification.
  • Where’s My Refund is updated daily, usually overnight.

The IRS is experiencing delays in processing paper mailed returns due to limited staffing.  Taxpayers should note that the IRS is processing the returns in order in which they received them.  Interest on returns filed by July 15th will be paid from April 15th until the date of refund.

Now….what are those common refund myths?

  • Calling the IRS or your tax preparer will provide a better refund date. Yay, no.  We cannot move up your refund date nor do we have access to a special website that gives us “specific” information on your refund date.
  • Ordering a transcript is a way to get a refund date. Transcripts help taxpayers find out what tax forms the IRS has received or what returns they have received, but not when you will receive your refund.
  • The Where’s My Refund? tool is wrong because there’s no deposit date. The Where’s My Refund shows the tax return status is received and is being processed.  Some returns take longer than others because there are items that need to be reviewed.
  • Something is wrong when the refund amount is less than expected. Why is my refund different?  Something must be wrong then.  There are a lot of reasons that cause a refund to be less than what was expected.  Per the IRS, this could include a taxpayer math error; Owing federal or state taxes, child support, student loans or other federal non-tax obligations, and a portion of the refund is being held until the IRS verifies items claimed on the return.

With how crazy 2020 is, why would it be any different with the Internal Revenue Service.  To take a quote from The Matrix, “That’s how it is with people.  Nobody cares how it works as long as it works”. ~Councilor Hamann.

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