Mar 21st 2012
By Anne Rosivach
Liberty Tax Services' Chief Operating Officer Rufe Vanderpool reports that there are no abnormal delays in client federal income tax refunds at this time, but individual taxpayers continue to report delays. Customers of Carmen Gorgone at a Reno H&R Block "have a bad case of late refund blues," according to channel KTVN. "Refunds are most definitely delayed. About twenty-one days," Gorgone said.
The IRS is giving inconsistent information about processing times, which can lead to a perception of delay. In statements, the IRS has said that taxpayers who e-file can expect their refund ten to twenty-one days after their return is "accepted"; however, the refund schedule indicates an average processing time of seven days.
Paper returns will take much longer, according to the IRS.
The IRS has acknowledged that earlier in the tax season, "several million returns" were delayed for weeks because of technical problems with a new e-filing system. "But the IRS has largely caught up, and the number of refunds sent out is now on a par with last year," IRS spokesman Frank Keith said in a Reuters report. The new e-filing system was designed to detect fraud and increase refund speed overall.
The IRS says that taxpayers can check the status of their refund on the Where's My Refund - It's Quick, Easy, and Secure page of the IRS website seventy-two hours after e-filing or four weeks after filing a paper return.
You should inform your clients that:
- Some delays are still being reported.
- Errors can result in a delay.
- The IRS refund schedule has not been changed to reflect longer processing times.
- The IRS is cautioning taxpayers that it is increasing its scrutiny of tax returns for signs of fraud. This means some tax refunds will face additional screening and review before being released, which will add time before the refund is delivered.
The IRS refund schedule shows dates when taxpayers can expect their refunds, either by direct deposit or by mail. For example, individuals whose returns were accepted between March 15 and March 21 should expect a direct-deposit refund by March 28, or March 30 for a mailed refund check.
On March 22, IRS Commissioner Doug Schulman is scheduled to report to the House Ways and Means Subcommittee on Oversight regarding the 2011 tax filing season. The subject of delays will be discussed during the hearing, along with other matters.
When Subcommittee Chairman Congressman Charles W. Boustany announced the hearing, he said, "The Subcommittee looks forward to hearing from Commissioner Shulman about steps being taken by the Agency to deliver timely service to American taxpayers during this filing season. In addition to a discussion of the current budget request, I am also particularly interested to learn more about how the agency is using its current budget to administer tax enforcement initiatives that protect taxpayer dollars from fraud."