If you waited more than a month for the IRS to process your tax return and get a refund last year, you’re in good company.
While the IRS prevented $2.7 billion in refunds from being issued to fraudsters between Jan. 1 and Sept. 30, 2019, more than a few legitimate tax returns were held up in the process, according to a recent report from the Taxpayer Advocate Service, an internal watchdog for the IRS.
These taxpayers were flagged because they claimed the earned income tax credit, the additional child tax credit or they had incomplete wage and withholding data on their Form W-2.
Approximately 275,000 of these tax returns were held for more than 40 days, resulting in financial hardship for people who relied on those refunds.
Even tax pros aren’t exempt from refund delays
Dan Herron, CPA and principal of Elemental Wealth Advisors in San Luis Obispo, California, has been waiting close to a year for an $800 refund from the taxman after filing his 2018 return.
Initially, the IRS sought more information on the accountant’s return, which he filed in March 2019. The agency said Herron’s return was flagged for potential identity theft, he said.
The return included a Form W-2 that reports Herron’s wages, a Schedule K-1 from his backpack manufacturer side-business and a Form 1099-B, which spells out gains and losses from the sale of investments.
The accountant has spent the last 10 months supplying the agency with hard copies of his return and supporting documents via certified mail, plus hours on the phone wading through call center menus and speaking with different staffers.
“Welcome to my nightmare: I get paid to do this, and I’m going through it,” Herron said. “Nobody is immune.”…Read more>>