Unexpected refund from IRS

[nativecrafts]

I filed taxes for 2021. I owed huge amount of taxes which I paid directly through my bank checking account. Return was accepted.

Now about two weeks later, I got a check from Dept of treasury (around $500). Says tax refund on the check. It has just a check and no letter explaining what is this check for. 

could anyone explain why I got this check? Was my tax return was audited  and IRS system figured out I paid taxes more than I needed? Will this impact my state tax return which I already filed? 

[xmasbaby0]

Only the IRS can tell you what the check was for.   TurboTax does not get any information from the IRS after you file your tax return.   Check your online IRS account to see if there is any information or call the IRS to ask (although that will be hard to do)

https://www.irs.gov/payments/your-online-account

To call the IRS:IRS:  800-829-1040  hours 7 AM - 7 PM local time Mon-Fri
Listen to each menu before making the selection.
First choose your language. Press 1 for English.
Then do NOT choose the first choice re: "Refund", or it will send you to an automated phone line.
Instead, press 2 for "personal income tax".
Then press 1 for "form, tax history, or payment".  
Then press 3 "for all other questions."
Then press 2 "for all other questions."  It should then transfer you to an agent.

[Carl]

Typically, you can expect to get a letter from the IRS in the next 3-4 weeks explaining things. If I were to guess, I would say you're probably self-employed and you made a $500 quarterly tax payment at some time in 2021 to the IRS, that you forgot to enter on your tax return. Therefore, you overpaid your taxes by $500.

But regardless, you can expect a letter in the next 3-4 weeks. Meanwhile, I'd suggest you not spend that money until you "know" you can keep it.

[Deedee24]

I had the same thing happen for my 2021 taxes: owed a lot and paid it, and have now received a nearly $5k refund check. I don’t understand why TurboTax is misestimating the taxes I owe this much - I have W-2 income, and am not self employed.

[SweetieJean]

TT goes by your data entry and answers to questions.  Could you have made a keying error?  Or did you apply part or all of your 2020 refund towards 2021 estimated taxes?

[oxyjimj]

Used TT to file my 2021 federal return. We made quarterly estimated tax payments through the EFTPS filing system. We owed additional and paid it electronically with our filing. Received a refund check from the IRS in the amount of the total quarterly estimated payments. Using the explanation letter, we subsequently determined that on the original return we had mistakenly entered the quarterly payments in the Other Income Taxes section and not the Estimates Section of TT. This duplicated the quarterly payment amount from the IRS perspective and they consequently issued us a refund. This is money we are not entitled to because we did not make duplicate payments to the IRS. We have filed an amended returned correcting the error.

[debbiedragonlady]

Most likely you paid in too much through estimated taxes and the IRS ended up sending you a refund.

[oxyjimj]

I think you missed it completely. I calculated and paid the tax liability owed. The IRS returned money to me that I NEVER gave them. I make four quarterly payments for my estimated tax bill. Both the IRS and Turbotax calculated the same tax amount due. However, the IRS said I paid more money than I did.  This only happened because I put the estimated payments amount on the wrong line in Turbotax.  I find it hard to believe the IRS does not verify monies received for tax payments before sending out refund checks that are clearly in error.

[fanfare]

@oxyjimj 

I think you missed it completely.

IRS computers see you made Estimated Tax payments.

You get credit for that even if you omit it on your 1040.

IRS is giving  you a refund of  your "Other Taxes", which you did not owe.

[oxyjimj]

Why would the IRS give me back  money for other taxes that I never paid. Is there no check on their side to verify I made the payments. Why are W-2's and 1099 forms created and sent to the IRS if it's not used to confirm tax payers are providing accurate information.  I entered the estimated quarterly payments on the wrong line in TuboTax and  that ultimately resulted in the IRS counting my payments twice and giving me a refund.  It's a bit unusual  that they wouldn't have built in checks and balances before just sending money out.

If anyone using Turbotax just enters a number on the other taxes line whether they actually paid it or not, will the IRS count that against their tax liability?  Seems to me this creates an opportunity for people to receive money they would not be entitled to.

[fanfare]

@oxyjimj 

Put your tax return in your desk and forget about it.

Take it out  a week from now and look again.

It will all be clear to you.

[VolvoGirl]

So what 1040 line did the other taxes paid show up on?  That may be only a Schedule A itemized deduction and doesn't apply it as a payment.  That won't affect your return or refund or tax due.

Or if it does show up to reduce your total tax they will eventually see it is wrong and ask for it back.

They saw the estimated payments were missing from line 26 and added it in for you.