Child tax credit, EIC, IRS delays refund and Turbotax rushing payment for filing

[Ramer09]

I filed me and my husband's taxes on January 28 and asked that payment to Turbotax be made using the refund. However, because we have child credits and eic the IRS decided to hold our refund for up to 60 days from March 16th. First, we had no warning that this was going to happen, but to make matters worse Turbotax sent us a message saying they will be taking their $85-86 from our account on April 3rd regardless. Regardless that the IRS is holding our refund that we need. Regardless of what it going on with the economy and what situation we are in. We have two children and filed jointly on January 28th. Only one W2 was on there and we were told by the IRS that we might have to wait until May 16th for them to finish reviewing it. And while we have to wait patiently for the IRS ....Turbotax is going to take money directly out of our account before we get our refund.

[ee-ea]

See the info in  this FAQ

https://ttlc.intuit.com/community/payments/help/what-if-my-federal-refund-isn-t-enough-to-cover-my-t...

[Ramer09]

I understand that I am probably certainly at fault,  because I didn't read everything under the "I agree" button. I have been using Turbotax for several years and never encountered this issue or anything like it. It would've helped if they had more obviously pointed out "clearly" what is going on with the IRS and let us know that they'd  take payment before the refund came through.  It also seems that Turbotax isn't going to be taking the situation in the country into consideration and at least wait a month or so longer for payment. .. 

[Ramer09]

Oh, and one more thing I think I should mention, after filing my taxes, Turbotax gave the 21 day estimate as usual. So, the estimated date for us to receive our taxes was February 19. But apparently, IRS wasn't even processing federal refunds for people with EIC or Child credits until after around February 27th (this isn't mentioned while filing). Turbotax doesn't inform anyone that their taxes are going to automatically be delayed, but they start a timer on you for their fees (which by the way, people could file their own taxes for free). Turbotax makes it out like they'll help you and help prevent problems and delays or help figure out what to do if a problem does occur, if you pay fees, but this isn't true either.  After the first week of March, I called the IRS directly to see if I had done something wrong with my taxes and the person only said "No, this is just policy, you'll get a letter on March 16th and we'll have 60 days from that day to look at your taxes". If I had known they wouldn't even start processing returns until after February 27th due to the CTC and EIC and that I wouldn't have a place in line because of how early I filed, I would have waited a month.

[AnnetteB6]

Please see the following TurboTax article and call customer support directly for a possible resolution:

What is the TurboTax phone number?

@Ramer09

[Ramer09]

No, none of that helps, and those links don't clarify why the IRS can wait 4 months to process our refund. It is May 17th  and  beyond the 60 days they were supposed to keep us "under review" and still nothing. No refund. No information. Apparently Turbotax is the tax servicer that most people are having this problem with being put under review . And Turbotax doesn't help resolve the problem,  instead they take their fees and say "well either IRS isn't giving you your refund or decided to delay it, but WE are taking our money because you used our product. 

[macuser_22]

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@Ramer09 wrote:

No, none of that helps, and those links don't clarify why the IRS can wait 4 months to process our refund. It is May 17th  and  beyond the 60 days they were supposed to keep us "under review" and still nothing. No refund. No information. Apparently Turbotax is the tax servicer that most people are having this problem with being put under review . And Turbotax doesn't help resolve the problem,  instead they take their fees and say "well either IRS isn't giving you your refund or decided to delay it, but WE are taking our money because you used our product. 

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It is because of the Corona virus shutdown.      Tax returns under 60 day review have been pulled from automatic processing and assigned to a human review agent who is now sitting at home waiting for the IRS to re-open so they can return to work and start reviewing the stack of tax returns  sitting on their desk.      The 60 day clock stopped when the agents went home 8 weeks ago.

See IRS article:

https://www.irs.gov/newsroom/irs-operations-during-covid-19-mission-critical-functions-continue

[Critter]

FYI ... TT is only a DIY income tax program and cannot assist you with your self prepared return or  speed up the IRS/state processes.  Sadly the virus situation has stopped the IRS/state  processing machines and it will take some time until those agencies are  up and running at full speed and have caught up with the backlog of work.  

[Ramer09]

Most of these websites are talking about how the IRS is going to take extra long if I mailed in my taxes and telling me the same old stuff that everthing else is saying. I filed my taxes JANUARY electronically with direct deposit setup-I did not mail in my taxes. I got an "under review letter" before everything closed down. This was before all of the irs employees were sent home and before covid closed everything down. Turbotax KNEW that due to certain laws passed by congress, that thousands of people's refunds would be delayed to begin with (before covid). They don't mention in an obvious way any of this. But they decided to go on a sneak in a way to get their fees anyway while these people have to be patient and wait around for IRS to review us. To make matters worse, covid. And what does Turbotax do? Say they don't care and take their fees anyway. Btw, people can file their taxes for free and Turbotax makes it difficult to even get to the free file service. All of these deluxe ways to file to help avoid mistakes or include an tax assistant seem to do very little to actually help in the situation where they are needed.

[Ramer09]

Also, I called and talked to an irs employee during the first week of March to see if I made a mistake, they said it was being put "under review" and it isn't because I made a mistake, it is because of a policy. 

[Ramer09]

Another thing I am wondering about is how can the irs send stimulus checks to dead people and "multiple checks to the same person" for thousands of people, but they aren't capable of processing returns they threw in a review pile before the virus shut everything down? And I realize that tt is a DIY service, that is one reason I don't see why they are pushing their fees so hard at a time like this.

[macuser_22]

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@Ramer09 wrote:

Another thing I am wondering about is how can the irs send stimulus checks to dead people and "multiple checks to the same person" for thousands of people, but they aren't capable of processing returns they threw in a review pile before the virus shut everything down? And I realize that tt is a DIY service, that is one reason I don't see why they are pushing their fees so hard at a time like this.

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There is a simple answer to that.     The sending of stimulus checks is mostly done automatically by the IRS computers based on the 2019 tax return (if there is one) or 2018 tax return.    If the person has dies on the mean time, the computer does not know. 

Tax returns under "review" have been pulled form the automatic system for hand processing by a human and the humans that do that were all sent home 8 weeks ago.

[Ramer09]

If the IRS is pulling peoples tax return to process by hand for review (which will take longer than the "60 days") why wasn't anyone informed about it? I know you are saying  that, and it does make sense, I haven't read (on IRS website or Turbotax) anything that specifically talks about what is going on with the people who were put under review before all of the irs was closed down. We have rights as taxpayers to be treated fairly and informed if our taxes are going to be delayed for some extended period of time. No one has mentioned that if the irs puts someone under review that they are going to pull them from the system to be processed "by hand" ( no letters and nothingon the website).  Instead people are being told that irs is still processing refunds and we should go on and still do our taxes.

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"

As the IRS expects to continue to process refunds as normal, taxpayers who are getting a refund are encouraged to file now to get their money. 

Will my refund be delayed?

No, the IRS expects to continue to process refunds as normal and still plans to issue nine out of 10 tax refunds within 21 days or less from acceptance with e-file and direct deposit "

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https://www.google.com/amp/s/blog.turbotax.intuit.com/tax-news/your-top-tax-quest[product key remove...

https://www.irs.gov/newsroom/taxpayer-bill-of-rights-2-the-right-to-quality-service-0

[Critter]

Ok ... well at the time that was posted no delays were expected however the IRS shut down many departments when they sent the workforce home 2 months ago and they are just getting back to work.  The 60 day notice you got told you the return was being reviewed.  Reviews are done by humans which were is short supply.  You will probably be getting a second 60 day letter soon. 

From the IRS :  

The return data is then transmitted to the Martinsburg Computing Center, where it is subjected to math error and validity checks before attempting to post to the IRS Master File. If no errors or inconsistencies are found and all requirements are met, refunds or balance due notices are issued to the taxpayer.

Return data with errors or inconsistencies is transmitted back to the processing centers where tax examiners make corrections using an Error Resolution System. The corrected return data is transmitted back to the computing center and attempts to post to the IRS master file.

https://www.irsvideos.gov/Professional/IRSWorkProcesses/SubmissionProcessingPipeline

[DawnC]

The Protecting Americans from Tax Hikes Act (PATH Act) prevents the IRS from issuing early refunds on any tax return that claims the Earned Income Tax Credit (EIC) and/or Additional Child Tax Credit.

Congress passed (in 2015) the PATH Act because identity thieves frequently claim one or both of these refundable tax credits. The PATH Act gives the IRS extra time to detect fraudulently-filed returns, which helps identity theft victims get their legitimate refunds more quickly.

The IRS usually begins issuing tax refunds on returns with the EIC or Additional Child Tax Credit in late February.

If your return contains either of these credits, you can track its status at the IRS Where's My Refund?  site.

They IRS has always reviewed tax returns.  However, in normal times, those are manually processed and the refunds issued or letters sent out within the stated time-frames.    Things are not normal right now and all of those returns that are under review (yours) are not being processed.  They are just sitting there waiting on the IRS to resume normal operations.  

Topic No. 152 Refund Information  

IRS Operations During COVID-19: Mission-critical functions continue

@Ramer09