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

[Ramer09]

You say that when that was posted on Turbotax's website that at that time "no delays were expected" but that 2 months ago everything changed and people at the irs were sent home to process everything... However,  the date of the information on tt website is dated on April 10th. That was only one month ago.  Maybe Turbotax should update their information and let people know that refunds are not being processed like normal, especially if you have clain EIC or have children.  That it could take up to 4 months longer than usual for them to even look at them, due to coronavirus. 

[Ramer09]

This is the timeline

January 28---- we get the W2 and I file our taxes

January 29---- "Yay!" They are accepted and being processed. Should get them around February 18.

February 18---- hmm nothing yet, probably tomorrow!

February 19th--- nothing still.... maybe I did something wrong or overlooked something,  but it was one simple W2.

Let me see if anyone else is having trouble. 

February 21 --- Find out that it is because I claimed my children and our family of 4 claimed EIC this year. But it says that if everything is good we should get it between the end of February or first week of March.

March 6th-------  Nothing still, I must've made a mistake. So I call IRS and they pull up my info. 

"Okay, you'll get a review letter on March 16 and we'll have 60 days to review everything"

"Did I do something wrong on my taxes?"

"No. It is just policy."

March 16--------- Coronavirus starts closing everything down. We get a letter saying under review and it tells us to not contact IRS until that review time is up, they'll let us know if they need anything from us.

April 3---- Turbotax takes their fee from our account since our refund is delayed.

* I guess Turbotax and their employees weren't affected by coronavirus.*

May 17--- Nothing still. I try to call IRS and can't get ahold of anyone. So I discuss it with different people.

May 19--- People on Turbotax thread say IRS probably wasn't able to review it  because IRS sent employees home due to coronavirus, and they pulled my taxes from the processing system. And I'll probably get another letter that will give them another 60 days because these "aren't normal times"....

But to say they need more time to review it more, makes the whole idea of PATH  act pointless. That law is supposed to give the IRS  more time so people who may be potential victims or affected by fraud or identity theft  can get their legitimate refunds FASTER.

I guess we'll have to wait another 60 days or more. 

******Murphy's Law******

[macuser_22]

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@Ramer09 wrote:

But to say they need more time to review it more, makes the whole idea of PATH  act pointless. That law is supposed to give the IRS  more time so people who may be potential victims or affected by fraud or identity theft  can get their legitimate refunds FASTER.

Actually the point of that provisions in the PATH act is NOT to speed up refunds or find victims of tax fraud but to find tax fraud being committed on the IRS by the filer.

Because falsely claiming EIC and ACTC was  a high area of fraud, Congress gave the IRS extra time to verify that the income reported on the tax return actually existed. 

In cases where the IRS has trouble verifying that income, as with some self-employed income or cases where the W-2 supplied by the employer is questionable (or the *employer* - not that taxpayer -  is on the IRS watch list) the IRS can pull the return for further review (a normal 60 days hold - turned much longer now because of COVID-19).     60 day holds are also done for no reason at all , just a random check  (like getting extra screening at an airport randomly).

[Ramer09]

I guess I misunderstood this part 

"The PATH Act gives the IRS extra time to detect fraudulently-filed returns, which helps identity theft victims get their legitimate refunds more quickly."

[Ramer09]

At this point it is no longer the 60 day thing that is the problem,  I've already waited 60+ days.  It is the idea the people (not just me) are going to be forced to wait possibly 120 days or more. What laws protect taxpayers from their refunds being held for and extended period of time.? If the law was passed to give the IRS  60 days to begin with where is the law that allowed them to tack on another 60 days on top of that? Where are the rights of the "people" being affected? 

[Critter]

Sadly the IRS rules simply state if it takes longer than expected to process a return and it is the IRS fault they have to pay you interest on the unpaid refund ... it is not enough but it is all you are going to get.  Complain to your Congress person ... get them working on this for you. 

[macuser_22]

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@Ramer09 wrote:

I guess I misunderstood this part 

"The PATH Act gives the IRS extra time to detect fraudulently-filed returns, which helps identity theft victims get their legitimate refunds more quickly."

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This part?   I don't know where yiu say that but the IRS says:

https://www.irs.gov/newsroom/path-act-tax-related-provisions

The PATH Act mandates that the IRS not issue a refund on tax returns claiming the Earned Income Tax Credit or Additional Child Tax Credit until Feb. 15. The additional time helps the IRS stop fraudulent refunds from being issued to identity thieves and fraudulent claims with fabricated wages and withholdings.

It does not say anything about speeding up refunds - it does just the opposite - it delays refunds.

[macuser_22]

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@Ramer09 wrote:

. What laws protect taxpayers from their refunds being held for and extended period of time.?

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The tax law says that if a refund is delayed more then 45 days after the tax return was received by the IRS or the due date of the tax return (July 15 this year), whichever is later, then the IRS must pay interest on the refund amount for each day additional day.   

There is no law that says how long the total delay can be.

[Ramer09]

The part I said I must have misunderstood was in DawnC's response. I also recall reading it elsewhere.

[macuser_22]

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@Ramer09 wrote:

The part I said I must have misunderstood was in DawnC's response. I also recall reading it elsewhere.

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I would go with what the IRS says as they are the authority and correctly stated the Congressional intent  as stated in §201 of the PATH act that mandates the delay of payment.

[Ramer09]

Where can I find this information about the 45 days and them paying interest that you speak of?

[macuser_22]

This IRS article has not been updated for the current July 15 due date but it does say "The return due date is generally April 15" which allows for other due dates.

https://www.irs.gov/businesses/small-businesses-self-employed/interest-for-individuals