If you’ve filed your 2020 tax return, you should have received your refund within 21 days. However, if you’re one of the 29+ million taxpayers whose refunds are still being held by the IRS, you’ll want to find out why. There are multiple reasons why you haven’t received your refund yet--including delays caused by Covid-19 related law changes. Find out how to determine the cause & rectify your refund delay below.
Did you file electronically or by mail?
The IRS receives your tax return within days when filed electronically. If you file by mail, it takes longer. Filing by mail also comes with risks like getting lost and never making it to the IRS. In addition, there are more steps to process a mailed tax return and therefore more room for human error. Any errors or mistakes will delay your tax refund. Calculation & other processing errors are very rare with electronically filed returns. Bottom line: file your tax return electronically when you can. Not only will you be confident that your return was received by the IRS, you’ll get your refund processed faster.
If you file your taxes by mail always do so with some form of tracking. You then have the ability to make sure your taxes were at least received by the IRS if you have not received your refund within 21 business days.
Did you claim the earned income tax credit (EITC) or child tax credit (CTC)?
Due to the mid-season tax law changes this year, the calculations & qualifications for both EITC and CTC tax credit have been adjusted. Filers who claim these tax credits may experience a delay in receiving their refund because the IRS is making sure the calculations are correct and accurate to dissuade abuse.
Did you file too late or too early?
There are ideal time frames when you should file a tax return. File too early, and not only might there be mid-season tax law changes, but most tax preparation software is not fully updated that early. This can cause unclaimed tax benefits & calculation errors which will delay your refund. Procrastinate & file too late, and your tax return goes to the back of the processing queue which again will cause delays. The earliest one should file a tax return is at the end of January; ideally the last week of the month. Most programs are fully updated by this point. The latest one should file is the month before the deadline month. In a normal tax year with an April 15th deadline that would be the last week of March. Since the deadline was extended to May, this year that will be the last week of April.
Did you update your personal information?
If you’ve recently changed banks, your home address, or any type of information pertaining to you or your identity, you’ll need to notify the IRS. Most people choose to have their refund deposited directly into their bank account. Others may have it mailed to them. Either way, it’s important to always update your information with the IRS so you receive your refund no matter what.
If you’re still waiting for your refund, contact R&G Brenner today. We’ll make sure you get all the money you are entitled to.