Be In the Know: The Reason Why Your Tax Return Is Delayed

Be In the Know: The Reason Why Your Tax Return Is Delayed

There are a lot of reasons why your tax return for 2021/2022 is delayed


Many taxpayers use the Where's My Refund tool and wonder what "Return being processed" means for them and their refund.


The answer: not much yet!


The prompt means that the IRS has received your return, but due to Covid-19 delays, the IRS is experiencing a considerable backlog, slowing processing times and disbursements. Typically, the IRS processes tax returns and issues refunds within 21 calendar days of receipt. The IRS even stated in January communicating the 21-day time frame. Add in the pandemic-related tax changes and child tax credit advances, and this tax season is more complicated than ever.



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Avoid filing a paper return.

Use electronic filing with direct deposit to receive your tax refund the fastest way. If your tax refund is delayed, you have options. You can call the IRS, but you should wait out the delays before putting yourself through this added stress. Due to the backlog, it can take 6-8 weeks to process your tax return.



The following are some of the reasons why tax returns take longer than others to process:

  • Your tax return includes errors, such as incorrect Recovery Rebate Credit
  • Your tax return Is incomplete
  • Your tax return needs further review in general
  • Your tax return Is affected by identity theft or fraud
  • Your tax return includes a claim filed for an Earned Income Tax Credit or an Additional Child Tax Credit
  • Your tax return consists of a Form 8379, Injured Spouse Allocation, which could take up to 14 weeks to process



See this related post from Dennis Harabin: 2022 Tax Season: Another Hectic Year for IRS and Taxpayers?
This could be another rough tax season for the IRS and taxpayers. Although this year’s filing season opens January 24, 2022 (i.e., it is the first day the IRS will accept and start processing 2021 returns), the Service still has a backlog of prior year returns to process and is plagued by staff shortages due to the pandemic and reduced funding in the last few years. Even though the majority of 2020 returns were filed electronically, many of those returns still required manual review, resulting in significant delays in IRS issuing refunds.




How to contact the IRS

You may call 800-829-1040 with any Federal tax questions. Getting through to the IRS over the phone is a challenge. According to the Taxpayer Advocate, only 1 in 9 calls to the IRS are answered. This even with a long wait time. Not surprisingly, it is best to call right when the IRS opens eastern time or late in the day before closing.



Does the IRS owe you interest on late refunds?

Even with the delays, the IRS owes you interest on your money. The IRS has administrative time (typically 45 days) to issue your refund without paying interest on it. You have until April 18 to file your taxes for this year. If you don't receive a refund within 45 days after the deadline, then interest may be owed by Uncle Sam.


Do you have some questions? Dennis Harabin at Relax Tax can answer them!



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