Whether you haven’t filed your tax return yet or filed weeks ago and don’t know why you haven’t gotten your refund, here’s how tax refunds work and what you can do to get your tax refund faster if you experience delays.
When should you file your tax return?
To get your tax refund faster, file your tax return as soon as possible. Most tax preparation software becomes available in early to mid January. The IRS accepts tax returns starting in mid to late January.
The IRS says it issues 9 out of 10 refunds in less than 21 days from when you file. You don’t need to wait until after April 15th. For example, if you file on February 1st, you can usually expect to see your tax refund by February 22nd.
There is a special rule if you claim certain refundable credits like the Earned Income Tax Credit or Additional Child Tax Credit.
- Federal tax law requires the IRS to not issue these refunds before February 15th.
- This is due to the amount of fraud related to these credits. The additional time allows the IRS to receive and process tax forms from third parties like your W-2 from your employer.
- You can still file before February 15th so you’re first in line to get your refund once these refunds start going out.
- Your entire refund will get held if this rule applies to you. You won’t get part of your refund early and then your credit later. You’ll get a single refund after February 15th.
How should you file?
File your tax return electronically whenever possible. The IRS automatically processes electronic returns. You can get your refund in your bank account in just a few weeks.
Paper returns have a longer processing time in normal times. That’s because the IRS enters them by hand. Add several additional weeks for processing. It also takes time for your paper return to go through the mail.
During COVID-19, paper returns have been delayed for months. The IRS stopped processing paper returns during 2020. It took them months to get through the backlog, and understaffing issues have continued throughout the pandemic. In many cases, you couldn’t even check the status of your refund because your tax return was sitting in a pile of unopened mail and not scanned in by the IRS.
Expect potentially long COVID-19 related delays getting your tax refund if you file your 2021 tax return on paper. If the IRS issues continue, it’s possible you may not get your refund until late 2022. To get your tax refund quickly, file electronically unless you have a special circumstance making you ineligible for electronic filing.
How should you request your refund?
The fastest way to get your tax refund is via direct deposit. The IRS has faster processing for direct deposits versus checks. In addition, you don’t need to wait for the check in the mail and then go to the bank to deposit your check.
Can you get your tax refund before you file?
You may be in a situation where you substantially overpaid your taxes and want to get your money sooner. For example, you paid estimated taxes but your income was lower than you estimated.
You can’t get your tax refund without filing. You will need to wait until at least January to be able to file your tax return so that you can get your tax refund.
What if you’re waiting on tax forms?
You don’t necessarily need to wait for tax forms to file your tax return if you know the numbers. For example, you’re waiting to get a 1099-NEC that you know is for $10,000. You can just enter the $10,000 on your tax return.
There is a small chance that filing before you get your tax forms will get you audited by the IRS. For example, they may not match the information you entered on the form. This could be because you used a slightly different payor name or tax identification number. However, as long as your income and expenses are correct, you can clear this up with a simple written explanation showing why you paid the correct amount of tax.
How can you track the status of your tax refund?
The best way to track the status of your tax refund is by using the IRS Where’s My Refund tool.
IRS phone and office representatives can only research the status of your refund if you’re in one of the following situations.
- It has been more than 21 days since you filed electronically
- It has been more than six weeks since you filed by mail
- The Where’s My Refund tool says to contact the IRS
The IRS will contact you by mail if it needs more information to process your refund. They will never contact you by email. They will only contact you by phone if you’ve already spoken to them.
What do the Where’s My Refund status messages mean?
If you’re using the IRS Where’s My Refund tool to check your refund aftery you filed your tax return, you may see the following messages.
Return Received/Tax Topic 152
If you filed electronically, you should see Return Received/Tax Topic 152 within a few days. It means the IRS got your tax return from your tax preparation company. They will do a few checks before approving your refund.
The message on the page means what it says. “We have received your tax return, and it is being processed. If you filed a complete and accurate tax return, your refund should be issued within 21 days of the received date. However, processing may take longer under certain circumstances. Please check here or visit the Refunds page on IRS.gov to check your refund status. Please read the following information related to your tax situation: Tax Topic 152, Refund Information.”
Code 152 doesn’t have a special meaning. The IRS just likes to assign numbers to everything.
Tax Code 570 and Tax Code 971
- These tax codes are not on your Where’s My Refund page. You can only see them if you check your tax transcript.
- Tax code 570 means the IRS is reviewing your tax return before sending your refund. They may or may not change it.
- Tax code 971 means the IRS is still holding your tax return. They are sending you a notice to request more information or to propose changes.
Most people get this message next. Your tax return passed the initial IRS checks, and you’ll get your refund by the listed date. If you don’t get your refund, check with your bank first, then call the IRS.
Refund Status Results
Sometimes, the Where’s My Refund page changes from the progress bars to no bars and says “Refund Status Results. Your tax return is still being processed. A refund date will be provided when available.” You may also see, “Your refund of tax withheld may require further review and could take longer.”
The status bars disappearing from the IRS website means you’re in for a longer wait. The IRS is having trouble verifying your eligibility for a tax credit you claimed, they’re waiting for additional third-party documentation, or your return was flagged for some other reason.
What can I do if I got the Refund Status Results message?
If your tax return is still being processed, there’s nothing you can do but wait. Often, everything will check out, and the IRS will finally approve your refund. You’ll wake up one morning to “refund approved” or a direct deposit in your bank account.
In some cases, you may get a letter from the IRS asking for more information or telling you they already adjusted your refund. You’ll need to respond according to the instructions on that letter.
Why is my tax refund taking longer than 21 days?
The IRS says that it processes most tax refunds within 21 days if you file electronically. If your refund is taking longer, here are some of the reasons why.
Tax Return Incomplete or Contains Errors
If your tax return is incomplete or has errors, the IRS will need to manually review it. Review times vary based on how busy the IRS is.
In some cases, such as simple math errors, the IRS might change your tax return and issue your corrected refund amount. In other cases, the IRS might send you a notice or error asking for additional information before they process your refund.
Identity Theft or Fraud Reports
If you’ve reported identity theft or fraud, the IRS may take longer to process your tax return. This is so they can check that the request for a refund actually came from you.
The IRS may also hold tax returns for potential fraud on their ow. For example, if you had significant changes in your tax situation from last year that match patterns fraudsters use, the IRS might hold your refund until they get more information.
Certain Tax Credits Have Mandatory Holds
Refundable tax credits have high instances of fraudulent claims. If your tax return contains these credits, the law says the IRS can’t process your tax return until at least mid-February. This gives the IRS time to collect additional informationn to check your claim for a refund.
Tax credits that could be subject to delays include the
- Child Tax Credit
- Additional Child Tax Credit
- Earned Income Tax Credit
Injured Spouse Allocation
If you filed Form 8379 Injured Spouse Allocation, you may be in for a long wait. The IRS says it takes up to 14 weeks to process tax refunds when you’ve filed Form 8379.
2020 Tax Returns
The IRS is still processing some 2020 tax returns even when people are already filing 2021 returns. These are mostly paper returns that weren’t filed on time or that had issues. The IRS says it still has a backlog due to COVID-19 and is processing these returns as quickly as possible.
If you need your 2020 AGI to file your 2021 tax return, the IRS says to enter $0 if your 2020 tax return hasn’t been processed.
Can you request to get your tax refund faster?
The IRS does not have a way to get your refund faster due to hardship or other reasons. The IRS processes refunds in the order it receives tax returns subject to the possible delays discussed above.