My husband and I filed e- file. Although we were getting a state refund we owed Federal taxes. At the time of filling the federal amount was deducted from out state refund. We were ok with that, the issue is that we received a letter from IRS letting us known that our payment was returned for insufficient funds. My husband and I are confused as to what happened? Why was IRS not paid the amount due? How do we track the funds?
Thank you
Sorry you can not have a tax due deducted from a refund. You must have misunderstood. At the end Turbo Tax shows you the net combined amount but that is just for your info. You will get the full refund and still need to pay the tax due,
In the FILE tab the option to pay the federal balance due with the refund was NEVER given ... only the option to mail in a check, have the balance due direct debited from a bank account, pay by CC/Debit card or to get on a payment plan. At no time was the option to apply the state refund to the federal balance due given ... as already mentioned you must have misread the summary screen the program gave you at the end. If you want to review the option you choose ( and that summary screen) you can log in, scroll down and click on ADD A STATE to let you back into the 2022 return then click on the FILE tab to review all those screens.