Getting a Tax refund can be one of the most psychologically draining experiences. Do you find yourself waiting for too long after applying for a tax refund? Many times, Taxpayers wonder why the refund delays for several days or months despite being Tax compliant citizens. It is key to note that whether you are operating your business, on-premise or remotely, staying compliant is mandatory.
Typically, your 2020 tax refund could have been affected by the advent of COVID 19, which paralyzed operations in most sectors. On the other hand, you may have left some details when filing the Tax refund forms, among other reasons.
How long does it take to receive Tax refunds?
In normal circumstances, Internal Revenue Service (IRS) offers Tax refunds within 21 days upon approving a request for a refund. The approval waiting time varies depending on the format used in requesting a refund.
After filling your Tax refund, consider these factors, so that if it takes longer than usual to receive your funds, you can follow up to ascertain what you couldn’t have gotten right during the filing process
Many factors could have caused delays in getting your 2020 Tax refunds in time;
1. System of application and format of payment
Requests filled electronically take three days for approval, while applications sent via email can take up to three weeks to be accepted. Other aspects that may further delay your Tax refund are the payment through a cheque, which might take another week to go through.
2. Ripple effect of COVID 19
The effects of COVID 19 have crippled operations in various sectors in the United States. This led to the suspension of operations by the Internal Revenue Service (IRS). The disruption of operations at the IRS resulted in a backlog of millions of refund requests.
In essence, you could have experienced delays in receiving your tax refunds during this period. Individuals who had filed for refunds by July 15th need not worry. IRS has given notification that all applicants who applied in time will be awarded an accrued interest of 5 % from April 15th to the date that the refund will be released.
3. Late or early filing
Taxpayers get tempted to apply for Tax refunds early so that they receive the funds soon enough. This might not convert to the actual picture you might be having in mind pertaining to receiving the amount in time.
The actual situation is that filing early might lead to unnecessary delays that you never expected. Internal revenue service is a high-traffic website. Before kicking off the process of going through refund applications, IRS may opt to carry out a system upgrade a few days, leading to the kick-off date.
This might affect your application since it might take longer to access your request. On the other hand, a late application might take a more extended period to process due to high application volumes associated with the last-minute rush. Your application, in this case, might take longer to be processed.
Another aspect that could have led to a delay in the issuance of Tax refunds in 2020 are changes initiated by US President Donald Trump recommending various changes on Tax laws. The new tax bill signed into law by Trump calls for the tax cut in the federal income Tax system among other changes.
This adversely affected the release of 2020 Tax refunds since the IRS had to align tax refunds in conformity with the new tax law.
4. Filling paper Returns
Did you file a paper return? If yes, then brace yourself for the most prolonged waiting period. Technology has made it easier to submit and access forms within the shortest time possible via various online platforms.
In case you are still stuck on the old ways of filling returns, then the waiting period associated with the process might not be so exciting.
Notably, IRS takes up to 12 weeks to process and approve paper returns. Should you request a cheque to be sent via an email, then the timeframe for a refund might be longer than expected.
Chances of cheques sent via email getting lost may further lengthen the duration of payment.
Therefore, it is necessary to use the most efficient method of processing payment to save you from uncertainties that may cloud your payment.
5. Wrong account information
Providing wrong bank account details during the filing of a request for Tax refund might be another nightmare that may complicate your quest to receive Tax refunds.
Cross-check account details before submitting your form since IRS uses the information to wire the amount to your account.
Should have submitted wrong bank account details, contact the IRS through their toll-free number (800) 829 -1040 so that they can stop the direct deposit.
After the successful reversal, IRS will refund through a paper cheque, which takes longer than normal to be processed. Should the bank decline to refund the money, you will have to fill the 3911 taxpayer statement pertaining to the refund.
Ideally, IRS uses form 3911 form to help track the refund on your behalf. All this will delay and complicate your refund process.
This, among other complex scenarios, may be the reason why you haven’t been able to receive your 2020 tax refund.
6. New security measures
IRS has put in place strict Security measures to protect against the loss of funds to unscrupulous individuals.
Should suspicious attempts to receive tax refunds through forgery be noticed during the process, the IRS launches an investigation to ascertain the credibility of the applicant.
This is usually followed by the issuance of a paper cheque that may further delay the tax refund process
7. Outstanding debt
Have you confirmed whether you never defaulted on the federal student loan, child support, business loans, or any form of debt? If that’s the case, IRS has an obligation to withhold your money. This is referred to as garnishment, where the payment is withheld awaiting to be directed to a different course.
Before requesting a tax refund, ensure you cross-check such factors to avoid tax refund payment delays.
8. Mistakes on your return
Taxpayers who rush in filling up the forms and end up providing wrong information might find themselves waiting for longer to receive their tax refunds. This is because it might take longer for IRS to cross-check the information submitted before approving the request.
Are you worried about your 2020 tax refund request hasn’t gone through? This article provides insights into the issues that may have slowed down your 2020 tax refund payment.