Still Waiting on Your Tax Refund? Here’s What You Can Do About It

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Chances are you got your third stimulus check months ago, but you may still be waiting on that other chunk of change the IRS owes you: your tax refund. 

As of June 5, the IRS is sitting on a backlog of 18.2 million individual tax returns. Many require manual processing, which basically means that a human needs to review it. 

To be clear, most taxpayers who e-file had their returns processed and received their refunds within 21 days, according to the IRS. But if you’re still waiting and wondering “where is my tax refund?”, here’s what’s going on and how you can track it.

Why You Haven’t Received Your Tax Refund

The 2020 tax season was an especially complicated one for IRS staff and accountants.

There were a number of complexities created by the three stimulus bills, the most recent of which passed in the middle of tax season. Along with the usual tax season mayhem, the IRS was tasked with delivering the third stimulus check. Plus, tax season started 16 days later than usual this year. These challenges prompted the IRS to extend the tax deadline to May 17. 

For example, people who typically qualify for the Earned Income Tax Credit, a credit for low- and middle-income working families, may not have been eligible in 2020 due to expanded unemployment benefits. The $900 billion stimulus package that passed in December changed the rules to allow families to use 2019 income to qualify instead of 2020 income. 

However, the IRS didn’t have time to update its programs to reflect this change, so if you’re seeking the Earned Income Tax Credit based on 2019’s income, an IRS employee will need to manually review it.

The same applies if you’re eligible for stimulus money from the first two checks based on your 2020 return that you didn’t qualify for based on your 2019 or 2018 return. For example, if your 2019 income was higher than your 2020 income, you may qualify for more stimulus money. Or if you had a child in 2020, you’d get stimulus credits on their behalf. These situations also require a manual review.

But your tax refund could also be delayed for all the reasons that would apply in a normal year. For example, if your refund was sent to a bank account that you’ve since closed, the IRS will eventually cut you a paper check, but that adds to the wait time. Your refund will also be delayed if you made an error or your return was incomplete.

The IRS could take your refund and use it to offset what you owe if you owe certain types of debt like child support or back taxes

If the IRS suspects fraud involving your return, you could also be in for a long wait for your refund — which has been a growing problem for taxpayers. IRS fraud filters flagged about 5.2 million returns for 2020, according to the Taxpayer Advocate Service. That’s almost a 50% increase from 2019. 

Most returns flagged for fraud don’t turn out to be fraudulent. But about 25% of returns flagged for income verification took 56 days or more to process in 2020. About 18% of those flagged for identity verification took longer than 120 days. 

Paper returns require manual processing, so if you’ve filed by paper, expect a long wait, even if there are no issues with your return. 

If you made an error that requires an amended return, your tax season will be even more prolonged. The IRS will notify you of the error by mail, and you’ll have to send in Form 1040X. There’s only one way to do this: by mail. Then, your amended return will be added to the 18.2 million unprocessed returns.

What to Do if You’re Still Waiting

The first step is to make sure the IRS has actually received your return. 

You can track your return using the Where’s My Refund feature on the IRS website or the IRS2Go app. You’ll need to provide your Social Security number, filing status and your exact refund amount.

But these tools have limited usefulness. If your return has been processed, they tell you when your refund is scheduled to be deposited, but they don’t provide information about why a return is still being processed or whether you need to provide additional information, which prompted recent criticism from the Taxpayer Advocate Service.

You should be able to see whether the IRS has accepted your return within 24 hours if you filed electronically. If the IRS has accepted your return, that just means it has confirmed it received it. The IRS still has to process it. 

If your return is flagged for fraud, you won’t be able to get specific information about your return status or when you can expect your refund using the IRS website and app, which has added to the frustration for many taxpayers. 

If you sent a paper return, you can expect a long wait before you can confirm that the IRS even has your return. Even in normal circumstances, tracking a paper return can take about four weeks.

The IRS says its staff will help you research the status of your refund only if you filed electronically more than three weeks ago or sent it by mail at least six weeks ago, or if Where’s My Refund tells you to get in touch. 

But only about 1 in 4 taxpayers who called the IRS in 2020 actually had their phone call answered. Even if you’re one of the lucky ones who gets through to a human, they probably won’t be able to give you much information. The IRS systems don’t tell employees who handle phone calls why a return required manual processing. But if you want to try, the number for checking the status of a refund is 800-829-1954.

Robin Hartill is a certified financial planner and a senior writer at The Penny Hoarder. She writes the Dear Penny personal finance advice column. Send your tricky money questions to [email protected].