One of the first most frequently asked questions I hear each year is:
The answer is always - it depends...
The IRS hasn't announced when it will begin processing tax returns, but based on past years, it is estimated that they will open e-file processing on January 21, 2020. However, in recent years, the start of tax season has been delayed until early February, due mostly to significant changes to the tax laws. Keep that in mind this year, since, if Congress makes new tax laws in December, it will likely cause a delay at the IRS.
Several additional factors can affect when a taxpayer may receive their return, including:
When you file
Whether your return is e-filed or sent by mail
The tax reform law that took effect in early 2018
Whether you have existing debts to the federal government
If you are claiming certain credits
The IRS is also continuing to delay processing of tax returns with
Earned Income Tax Credit or Child Tax Credit
Early filers will continue to see a delay in your refund because Congress passed a law last year that requires the IRS to hold all tax refunds that include the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC) until February 15, 2020, regardless of how early the tax return was filed. So, if you file on the first day, you might still be waiting until mid to late February for your refund.
These credits have often been the focus of misuse and abuse and taxpayers with these credits should expect a delay in processing by 2-3 weeks assuming there are no other problems with the tax returns. The goal of this is to cut down on fraud and give the IRS time to ensure no duplicate returns are filed.
Be sure to note that the IRS will hold your entire tax refund, not just the EITC or ACTC part.
This chart is only an estimated timeline for when a taxpayer is likely to receive their refund, based on the information we have now, and using projections based on previous years.
What If You Can't File Your Income Taxes By April 15?
Taxpayers who don't have all of the paperwork needed in order to file their taxes can easily file an automatic extension which will give you until October 15 to file your tax return.
However, if you owe taxes, it is still your obligation to pay those taxes by April 15, even if you have requested an extension to file.
While we are, of course, available to provide you with any business, accounting or tax services, the information contained herein is general in nature; any advice regarding those services should not be construed as tax advice and is not intended as a thorough, in-depth analysis of specific issues, a substitute for a legal, accounting or tax advice or opinion, nor is it sufficient to avoid tax-related penalties to the reader. The reader also is cautioned that this material may not be applicable to, or suitable for, the reader's specific circumstances or needs, and may require consideration of non-tax and other tax factors if any action is to be contemplated.
The reader should contact Strive Tax & Accounting, LLC or other tax or legal professional prior to taking any action based upon this information. Strive Tax & Accounting, LLC assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.