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Refundable Credits May Affect the Timing of Your Refund

by Tracey Hrica, EA Jan 22, 2020 | Share

If you claim the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit, the timing of your refund may be affected. The Protecting Americans from Tax Hikes (PATH) Act prohibits the IRS from issuing refunds that contain these credits before February 15th.  The IRS expects taxpayers to see these refunds by the first week of March, as long as there are no other issues with the returns. In addition, taxpayers with these refundable credit will not be able to track their refund until February 22nd on the IRS’ Where’s my refund? application.

These refund delays began three years ago when Congress imposed measures to attempt to thwart tax fraud.  Fraud dealing with EITC continues to be an issue the IRS battles.  About 1 in 4 returns claiming the credit contain errors, and in 2018 an estimated $18.4 billion EITC overpayments were issued, according to the Government Accountability Office.

Four ways to get the fastest refund

  • File early
  • Make sure all information is accurate
  • File Electronically
  • Opt for Direct Deposit of your refund

Other reasons for a delayed refund

  • Name and Social Security number does not match IRS records
  • Math errors
  • Entering data on the wrong lines of the form
  • Your refund was offset against prior federal tax balance due, past due child support, unpaid state tax obligations, unpaid federal student loans
  • Possible identity theft
  • IRS audit
  • Incorrect bank account information

Filing a paper return

Filing a paper return can cause additional delays. Paper returns are processed manually, which usually takes between four and six weeks. In 2018, the IRS warned taxpayers of delays in processing paper returns, suggesting that the minimum turnaround time could be as long as seven weeks.

About the Author

Tracey Hrica, EA

Tracey Hrica joined the firm in 1995. She is an Enrolled Agent(EA), which enables her to prepare personal and business tax returns and represent clients before the IRS. Working closely with her clients, Tracey’s primary areas of concentration are new client set up and QuickBooks support. As a QuickBooks ProAdvisor, she works closely with clients who rely on QuickBooks for the day to day running of their business. Tracey has expertise in both QuickBooks Desktop and QuickBooks Online.

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