Federal tax refund is late

[VictoriaF]

I filed my 2019 Federal and state income taxes on May 1st, 2020. Both required refunds to my bank account. I filed on paper and mailed them using USPS certified mail.

Today's status is as following:
- A couple days ago, I received a refund of my state income tax.
- My IRS Get Transcript account shows that I have NOT filed the 2019 tax.
- The USPS tracking tool shows that the Federal tax has been delivered on May 19th, 2020.
- The IRS advises that a paper refund is considered "late" after 6 weeks from the date of mailing.
- My refund is now more than 6 weeks late.

I am interested in others' experiences. Should I wait a couple more weeks? When should I assume a problem and call the IRS?

Victoria

[HueyLD]

This topic has been discussed in many threads.

Here is what I posted yesterday:

“ Directly from the IRS:

The IRS is not currently able to process individual paper tax returns. If you already have filed via paper but it has not yet been processed, do not file a second tax return or write to the IRS to inquire about the status of your return or your Economic Impact Payment. Paper returns will be processed once processing centers are able to reopen.

My comment: Just wait until Dec. 31, 2020. It could be later.”

[VictoriaF]

Thank you, HueyLD. I missed other threads. I don't mind to wait for as long as it is normal.

Victoria

[Nestegg_User]

VictoriaF

welcome to the club

we paper filed ours almost two months before yours and are still waiting for it to be noted as "received"
(we sent registered mail so have already seen that it was, at least, received by them.... but it's likely just sitting in the massive trailers with all the rest.... and it's likely a number more months for our refund to get sent/received)

{lots of threads and consternation on that topic}

[the way]

I wonder if addressing to the other address used when taxes are owed would get a refund processed sooner. We know that they are opening those paper returns because people have said their checks are being cashed.

[tj]

I wonder if addressing to the other address used when taxes are owed would get a refund processed sooner. We know that they are opening those paper returns because people have said their checks are being cashed.

I'm sure they re-opened sooner, but those offices were closed too. My understanding is IRS has only re-opened in some of the states that they have service centers.

[tealeaves]

I filed my 2019 Federal and state income taxes on May 1st, 2020. Both required refunds to my bank account. I filed on paper and mailed them using USPS certified mail.

Today's status is as following:
- A couple days ago, I received a refund of my state income tax.
- My IRS Get Transcript account shows that I have NOT filed the 2019 tax.
- The USPS tracking tool shows that the Federal tax has been delivered on May 19th, 2020.
- The IRS advises that a paper refund is considered "late" after 6 weeks from the date of mailing.
- My refund is now more than 6 weeks late.

I am interested in others' experiences. Should I wait a couple more weeks? When should I assume a problem and call the IRS?

Victoria

I filed nearly 3 months ago and have the same issue. Hoping that when I do get the refund it will be with interest greater than what I can get in my savings account. Might be a good option to short term treasuries.

[mrc]

I have a reverse problem. I e-filed federal, and snail mailed state. I received the federal refund in about a week. Nothing from the state. Checked online and the status was something like, we processed your return on 02/22 and you won't be getting a refund. We're sending you a letter.

I figured it may be I forget to attach the W2 (for $40 of extra pay the wife received long after separating from service). I contacted the tax office, and they agreed and suggested I submit the PDF of the W2, which I did. Six weeks later, still no refund or letter. Did I make a mistake (I used Turbotax)? I can't tell. The reply was, look for a letter in a few days.

I filed on time (prior to 04/15) and still got caught in the COVID affects. It's clear the COVID issues have really scrambled what was already a fairly fragile system. I've resigned to wait them out. The refund due is less than $100, so it's no hardship to wait. But hoping anything will happen for months yet feels unrealistic. Keep your documentation handy and wait. You're certainly not alone!

[jebmke]

Yes; two lessons have really jumped out of all this. Always owe money if possible (or have little or no refund that you care about) and efile unless you can't. In a very narrow set of circumstances, paper returns are required. Fortunately, with the rollout of efile for amended returns, a major percentage of those cases will no longer apply.

[tj]

H&R Block software would not efile my Arizona and Hawaii partial years. I paper mailed, but I owed both and I made online payments.

I want to say this was back in January or February. I guess I don't know if they processed the returns yet, but I haven't heard anything.

[jebmke]

Yes; in some cases it won't allow efile. I tried to efile a MD return for the widow of a friend and it won't efile deceased taxpayers. Not sure if this was an HRB thing or MD. Fortunately, MD is pretty well organized so her paper return won't get lost and since she owes money, it doesn't affect her financially.

The Federal response time on efiling is incredible. I received an ACK within 5 minutes of filing her return.

[the way]

I filed nearly 3 months ago and have the same issue. Hoping that when I do get the refund it will be with interest greater than what I can get in my savings account. Might be a good option to short term treasuries.

oh, I was going to try my idea next week, but this sounds better. I wonder when the interest clock starts ticking - April 15, the day I send it, July 15, or the day they process it?

[bighatnohorse]

I e-filed before April 15th and am still waiting. Refund is under $10K
I check the IRS wheres-my-refund and they say it's "processing".

[DiMAn0684]

I e-filed before April 15th and am still waiting. Refund is under $10K
I check the IRS wheres-my-refund and they say it's "processing".

Same here, ~$2k refund due to a new family member late in the year. Surprised it is taking this long, pretty simple return.

[jebmke]

I think they may have shifted all their attention to the relief payments.

[integritetus]

I efiled my federal return on April 2nd. I am expecting a refund to be directly deposited. The IRS accepted the return within an hour. Within a few days the status bar on the Where's My Refund tool showed that the return had been received. The status bar stayed in the return-received state for a few weeks. Then the status bar was replaced with this message: "Your tax return is still being processed. A refund date will be provided when available". And so it has been ever since.

Today I checked my IRS account to see if there was any information in the transcript for 2019. That shows no return filed for 2019.

[UpperNwGuy]

I'm guessing more and more folk will stop filing paper returns in future years. It's pretty clear that e-filing is safe, efficient, and reliable.

[TheDDC]

How does one e-file for less than the cost of a stamp? Mailing in papers is merely the cost of postage. I have SP income so with they comes with other schedules and four digit forms that also need to get files.

-TheDDC

[Hyperchicken]

How does one e-file for less than the cost of a stamp?

How one does not?

I've been e-filing for free for years. Federal is available to everyone. State - depends on the state, my has it.

[sycamore]

I e-filed for Federal and mailed in paper for state to save myself the $19.99 fee when filing the state (I use TurboTax). Was $20 worth it? Yes, at least in normal times. Will I do it again? Hmm...

[UpperNwGuy]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

[TheDDC]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

Because we already have to pay them, and I’d prefer it not be a penny more. Why pay extra for the privilege of filing something that is required of us?

-TheDDC

[rkhusky]

I dropped my return in the mailbox in early February. My check was cashed in less than 10 days. I think I was able to get away with one stamp by printing two-sided where applicable.

[UpperNwGuy]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

Because we already have to pay them, and I’d prefer it not be a penny more. Why pay extra for the privilege of filing something that is required of us?

-TheDDC

Like I said, I never cease to be amazed....

[TheDDC]

Okay I’m looking here for the unicorn “free e-filing options” from the IRS themselves. I see nothing that fits my situation:

https://apps.irs.gov/app/freeFile/

So, again I say that filing by paper is still the lowest cost option and no, there is no reason to pay the federal government more than what is due.

-TheDDC

[TheDDC]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

Because we already have to pay them, and I’d prefer it not be a penny more. Why pay extra for the privilege of filing something that is required of us?

-TheDDC

Like I said, I never cease to be amazed....

Would you rather pay an additional markup on your federal tax bill for the privilege of filing REALLY FAST as long as you could pay 0 for postage? If so, that is incredibly stupid.

-TheDDC

[sycamore]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

Thanks! Many people tell me I'm amazing.
But that's probably not what you meant

[UpperNwGuy]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

Because we already have to pay them, and I’d prefer it not be a penny more. Why pay extra for the privilege of filing something that is required of us?

-TheDDC

Like I said, I never cease to be amazed....

Would you rather pay an additional markup on your federal tax bill for the privilege of filing REALLY FAST as long as you could pay 0 for postage? If so, that is incredibly stupid.

-TheDDC

Cost of doing business in the modern world, my friend. Join the 21st Century.

[Hyperchicken]

Okay I’m looking here for the unicorn “free e-filing options” from the IRS themselves. I see nothing that fits my situation:

https://apps.irs.gov/app/freeFile/

So, again I say that filing by paper is still the lowest cost option and no, there is no reason to pay the federal government more than what is due.

-TheDDC

https://www.irs.gov/e-file-providers/be ... able-forms

Thank me later.

[TheDDC]

I never cease to be amazed by the number of bogleheads with six and seven figure investment portfolios who agonize over the paltry cost of e-filing their tax returns.

Because we already have to pay them, and I’d prefer it not be a penny more. Why pay extra for the privilege of filing something that is required of us?

-TheDDC

Like I said, I never cease to be amazed....

Would you rather pay an additional markup on your federal tax bill for the privilege of filing REALLY FAST as long as you could pay 0 for postage? If so, that is incredibly stupid.

-TheDDC

Cost of doing business in the modern world, my friend. Join the 21st Century.

Except when you talk about dealing with/paying government, you definitely aren’t talking about “doing business” in any sense. Not when it comes to paying more for the privilege of paying taxes. Like I said, nonsensical. Like paying an AUM.

BTW Hyperchicken thanks for the free fillable form site. It looks a bit shady but it might do. Does it have most all of the forms you can get via paper? Maybe my CPA will be open to it.

-TheDDC

[UpperNwGuy]

Because we already have to pay them, and I’d prefer it not be a penny more. Why pay extra for the privilege of filing something that is required of us?

-TheDDC

Like I said, I never cease to be amazed....

Would you rather pay an additional markup on your federal tax bill for the privilege of filing REALLY FAST as long as you could pay 0 for postage? If so, that is incredibly stupid.

-TheDDC

Cost of doing business in the modern world, my friend. Join the 21st Century.

Except when you talk about dealing with/paying government, you definitely aren’t talking about “doing business” in any sense. Not when it comes to paying more for the privilege of paying taxes. Like I said, nonsensical. Like paying an AUM.

BTW Hyperchicken thanks for the free fillable form site. It looks a bit shady but it might do. Does it have most all of the forms you can get via paper? Maybe my CPA will be open to it.

-TheDDC

Wait! You pay a CPA big bucks to do your taxes but then save small bucks by refusing to e-file???

[marcopolo]

I efiled my federal return on April 2nd. I am expecting a refund to be directly deposited. The IRS accepted the return within an hour. Within a few days the status bar on the Where's My Refund tool showed that the return had been received. The status bar stayed in the return-received state for a few weeks. Then the status bar was replaced with this message: "Your tax return is still being processed. A refund date will be provided when available". And so it has been ever since.

Today I checked my IRS account to see if there was any information in the transcript for 2019. That shows no return filed for 2019.

Similar experience here.
Helped my son e-file his return in mid-march, and currently in same state as yours. Seems e-filing is no panacea.

[jebmke]

Seems e-filing is no panacea.

Indeed. Always best to owe or little/zero refund whenever possible. Not always easy for pure wage earners; especially if refundable credits involved.

[IRS-Gman]

I efiled my federal return on April 2nd. I am expecting a refund to be directly deposited. The IRS accepted the return within an hour. Within a few days the status bar on the Where's My Refund tool showed that the return had been received. The status bar stayed in the return-received state for a few weeks. Then the status bar was replaced with this message: "Your tax return is still being processed. A refund date will be provided when available". And so it has been ever since.

Today I checked my IRS account to see if there was any information in the transcript for 2019. That shows no return filed for 2019.

It's likely your return is being reviewed by the Taxpayer Protection Program for authenticity. This program sometimes requires taxpayers to verify they filed the return (not by someone who stole your ID) and/or verify certain items on the return, such as W-2 info.

Normally you'd be informed of this by letter. Unfortunately, the IRS mail system has been down since late March and has only recently started sending letters again (and on a limited basis). It will take a while for IRS to get through the backlog. You'll be paid interest on your refund.

[Random Poster]

BTW Hyperchicken thanks for the free fillable form site. It looks a bit shady but it might do. Does it have most all of the forms you can get via paper? Maybe my CPA will be open to it.

-TheDDC

Be sure to read about the known limitations and issues with the free fillable forms before trying to use them, particularly for form 1116 and in regards to attaching any statements.

[dodecahedron]

Like I said, I never cease to be amazed....

Would you rather pay an additional markup on your federal tax bill for the privilege of filing REALLY FAST as long as you could pay 0 for postage? If so, that is incredibly stupid.

-TheDDC

Cost of doing business in the modern world, my friend. Join the 21st Century.

Except when you talk about dealing with/paying government, you definitely aren’t talking about “doing business” in any sense. Not when it comes to paying more for the privilege of paying taxes. Like I said, nonsensical. Like paying an AUM.

BTW Hyperchicken thanks for the free fillable form site. It looks a bit shady but it might do. Does it have most all of the forms you can get via paper? Maybe my CPA will be open to it.

-TheDDC

Wait! You pay a CPA big bucks to do your taxes but then save small bucks by refusing to e-file???

Free Fillable Forms is intended for use by do-it-yourself taxpayers on self-prepared returns. The IRS expects paid third party preparers (i.e., tax professionals) to efile using professional software which will track the PTIN (preparer tax identification number) of the preparer. If you are paying your CPA to prepare your returns, it would be illegal for him to use the Free Fillable Forms to efile it. FFF has no way for him to enter his PTIN or his electronic signature as paid preparer of the return.

[david99]

I e-filed before April 15th and am still waiting. Refund is under $10K
I check the IRS wheres-my-refund and they say it's "processing".

Same here, ~$2k refund due to a new family member late in the year. Surprised it is taking this long, pretty simple return.

I e-filed in June. I owed money and it was taken out of my account within a few days.

[dodecahedron]

Thank you, HueyLD. I missed other threads. I don't mind to wait for as long as it is normal.

Victoria

It would not have been normal in any past year that I know of to have a refund delayed this long AND radio silence from the IRS. (Delayed refunds do happen in normal years, but in normal years they would virtually always have long ago at least sent you a letter explaining why they are holding it up, e.g., identity theft or wanting more supporting info.)

However, this is an unprecedented year. There is a backlog of 11 million paper returns that has been piling up in warehouses awaiting processing for months.

And for *this* year, your wait with no refund and radio silence from IRS is quite understandable. It may continue for quite a long time if your return happens to be at the bottom of the pile, but if it goes on long enough you will be compensated for it.

The IRS is required to pay interest on refunds that are delayed more than 45 days past the filing deadine (assuming the return was timely filed). In normal years, the filing deadline is 4/15 so the interest clock starts running if refund is not sent by end of May.

This year, the filing deadline is 7/15, so I assume that refunds on timely filed returns that have not been sent out by the end of August will begin accruing interest.

The interest rates the IRS pays to individuals on delayed refunds are the same interest rates that individuals would pay to the IRS on delayed balance due payments (e.g., under an installment agreement.) They are adjusted each quarter.

In 2018 and 2019, the rates were as high as 5% or 6% in some quarters. It was a pretty good deal for me. My refund on my 2017 return (efiled in March 2017 but delayed because IRS chose to request supporting information which it took a long time to process, in part due to shutdowns) was delayed over a year. Even considering the fact that the first couple of months accrued zero interest (before the interest clock started running) it was pretty competitive fixed income return for that period, considering it was backed by full faith and credit of US Treasury.

The IRS just announced the rates that will apply in the third quarter of 2020. The rate will be 3% during the July 1 through Sept 30 quarter.

https://www.irs.gov/newsroom/interest-r ... er-of-2020

Please do NOT call the IRS at this time. At this point in the filing season, they are always inundated with calls and this year is an epically bad one. Your paper return is almost surely on the floor of some warehouse and if you somehow get through to the IRS to reach an actual employee they have zero way of accessing any physical trace of your return.

[spectec]

I'm recommending to my clients that anyone who has filed and has not seen any resolution should file an extension. This applies to both refunds and balance due returns. Filing the extension has no immediate effect on the return, but pushes the due date to Oct 15. The reasons are a little complicated and possibly esoteric, but filing the extension costs nothing and is very easy to do.

[AlohaJoe]

How does one e-file for less than the cost of a stamp?

How one does not?

I've been e-filing for free for years. Federal is available to everyone.

Federal isn't available to everyone. Not every form is available for e-file. Nor can you attach external documents (if you discharge a bad debt, you need to write a bad debt statement). You cannot apply for an EITN via e-filing. I'm sure there are more examples.

E-filing works for many cases but not everyone.

[mouses]

Does no one read the news? There is a pandemic. What do you think the IRS workers are doing, risking their lives to process paper returns?

No. Wait until they are back at work.

How many threads have we seen as I mailed my tax return nothing has happened.

[jebmke]

Does no one read the news? There is a pandemic. What do you think the IRS workers are doing, risking their lives to process paper returns?

No. Wait until they are back at work.

How many threads have we seen as I mailed my tax return nothing has happened.

almost as many as "why did my fund NAV drop today, the market was up!"

[VictoriaF]

The IRS is required to pay interest on refunds that are delayed more than 45 days past the filing deadline (assuming the return was timely filed). In normal years, the filing deadline is 4/15 so the interest clock starts running if refund is not sent by end of May.

This year, the filing deadline is 7/15, so I assume that refunds on timely filed returns that have not been sent out by the end of August will begin accruing interest.

Thank you, dodecahedron, this is very informative.

My refund is not large and the interest on a delayed refund would be insignificant. But I am curious why the IRS is calculating the delay starting with the filing deadline rather than the date when they have received the return.

I am speculating that if the IRS may end up paying interest, they'll try to process returns with higher refunds before returns with lower refunds.

Victoria

[furwut]

I eFiled on March 5th and got my Federal refund eDeposit on March 18th. My state eDeposit refund didn’t come thru until May 14th. Perhaps my federal return got processed right before things went haywire.

[M.Lee]

I filed two returns, both in February. One return was sent electronically and money was owed and paid. I know that tax return was looked at because I got a small portion of the stimulus payment from that income.

The other return was for a deceased person, so a paper returned was sent. A refund is due on that return. The "Where's My Refund" has been showing it received and processing for a couple months.

I notice that the site now says the paper returns will be processed in the order in which they were received.

Processing Delays for Paper Tax Returns

We continue to process electronic and paper tax returns, issue refunds, and accept payments. We’re experiencing delays in processing paper tax returns due to limited staffing. If you already filed a paper return, we will process it in the order we received it.

[talzara]

Does no one read the news? There is a pandemic. What do you think the IRS workers are doing, risking their lives to process paper returns?

Taxpayers do not expect the IRS to be using processes designed in the 1960s.

The IRS does not allow taxpayers to e-file PDF forms, which some states used to allow. The IRS does not use 2D barcodes on computer-prepared paper returns, which many states have been doing for 10 years. The Office of the Taxpayer Advocate has been telling the IRS for more than 10 years to scan in paper returns and use computer vision to read the numbers, but the IRS doesn't do that either.

The IRS still uses human typists to key in paper tax returns, just like they did in the 1960s.

There are open-and-extract machines that can open an envelope, extract the contents, and scan them in -- at a rate of one envelope per second! The IRS has 11 million returns piled up over three months of lockdown. Just two machines running 24/7 could've kept up with the inflow.

[jebmke]

With limited funds, the IRS invested in updating their efile system just a few years back to the MEF system. Given their budget limitations this was the right move in my opinion. Businesses make this decision all the time - invest in the newer technology product and do only limited maintenance on an older technology product. The move this year to allow efiling of amended returns is consistent with that and will take a large portion of the paper returns to efile.

[dodecahedron]

The IRS is required to pay interest on refunds that are delayed more than 45 days past the filing deadline (assuming the return was timely filed). In normal years, the filing deadline is 4/15 so the interest clock starts running if refund is not sent by end of May.

This year, the filing deadline is 7/15, so I assume that refunds on timely filed returns that have not been sent out by the end of August will begin accruing interest.

Thank you, dodecahedron, this is very informative.

My refund is not large and the interest on a delayed refund would be insignificant. But I am curious why the IRS is calculating the delay starting with the filing deadline rather than the date when they have received the return.

A full answer to your ¨Why?¨ question would require going into a lot of fascinating but off topic tax policy history, some of which could violate forum guidelines.

The essence of the law is that regardless of how early a timely return is submitted, the IRS is not considered to have any legal obligation/expectation to pay refunds on early submitted returns before the filing deadline plus 45 days. The fact that with modern technology, it is often able to process refunds on most early submitted returns does not require the IRS to process *all* returns before the filing deadline plus 45 days.

Some returns filed in January take longer to process than others due to complexity, technical idiosyncrasies, paper filing, the IRS need to wait for delayed or corrected third party documents such as 1099s, W-2s, 1098s, 1095s, concerns about identity theft or a dependent being incorrectly claimed.

So the IRS has a rule allowing it to take what could be considered a reasonable amount of time (in normal circumstances) for most timely filed returns to be processed. That rule has traditionally been filing deadline plus 45 days.

There is a kind of symmetry. If you file a balance due return in January and do not pay immediately, your interest clock does not beginning immediately. It begins on the filing/payment deadline (normally mid-April but mid-July this year.)

(Of course, all of the above refers to *interest*. Penalties for late payment on balance due returns may start running well before the return filing deadline if the withholding/estimated tax deadlines were not met.

All that said, I think there is a lot to be said for efiling returns. The IRS makes more mistakes in transcribing and processing paper returns, there can be disconcerting situations where you do not know if the IRS has somehow lost your paper return, an identity thief has more time to efile and preempt your still-unprocessed paper return. There is no need to save/worry about losing evidence of mailing or delivery or stand in line at PO to mail.

These are true in general every year, but especially this year. My advice to any Bogleheads who have yet to file this year: efile if at all possible! (Yes, I know there are a few special situations such as those listed above where it is not. Bill Gates once said his income had too many digits!) But the overwhelming majority of returns can be efiled.

[tj]

The IRS is required to pay interest on refunds that are delayed more than 45 days past the filing deadline (assuming the return was timely filed). In normal years, the filing deadline is 4/15 so the interest clock starts running if refund is not sent by end of May.

This year, the filing deadline is 7/15, so I assume that refunds on timely filed returns that have not been sent out by the end of August will begin accruing interest.

Thank you, dodecahedron, this is very informative.

My refund is not large and the interest on a delayed refund would be insignificant. But I am curious why the IRS is calculating the delay starting with the filing deadline rather than the date when they have received the return.

I am speculating that if the IRS may end up paying interest, they'll try to process returns with higher refunds before returns with lower refunds.

Victoria

The reason is that when you file early, you are considered to have filed on the due date. The statute of limitations also begins in April rather than actual filing date...

[jebmke]

The reason is that when you file early, you are considered to have filed on the due date. The statute of limitations also begins in April rather than actual filing date...

Presumably it works both ways. If you underpay and later get assessed, the interest for underpayment starts on the filing due date, not the date you underpaid (if that occurred before).