Where is my tax refund?
This is a question we get asked all the time when our clients have done everything right and yet they still haven’t received their tax refund.
So what’s the deal? Well in this post, we want to help eliminate all of the questions and confusion around:
- Where your tax refund is?
- How you can get it faster?
- Why are you may or may not be getting a tax refund in 2021?
So if you haven’t received your tax refund in 2021 yet then we have about 5 steps that you can take to find out what’s going on.
And then we have another 4 things that you need to consider.
Let’s go ahead and dive into the first action step you can take if you are looking for your tax refund.
Steps to Better Understand Your Tax Refund in 2021
1. Use the IRS Website Tool Where’s My Refund?
Now, this is something that a lot of you may already be aware of and possibly already tried, but if you haven’t yet here’s what you need to know.
So when you go to irs.gov, at the very top, you will see a link that says get your refund status.
Click on that and you will be able to put in some information and find out what stage in the process your refund is in.
You will need three pieces of information:
- your Social Security number,
- your filing status,
- the exact amount of your refund
But if you are off by even a single digit on any of the information, this tool will not work for you.
For the Social Security number, do you want to use the number of the primary tax filer, not the spouse?
For the filing status, it’s pretty straightforward. You need to put whether you are filing single, married and filing jointly, etc.
And for the exact refund amount, you can look on your tax return on line 35a to see your exact refund amount.
So this is a quick and easy tool to discover where your refund is, and remember that the information you enter has to be 100% accurate.
2. What Stage Your Tax Refund Is?
The stages of your tax refund will be one of these three different stages which are:
- your tax return is received,
- your tax return is approved or rejected, and
- your tax refund was sent
So let’s take a look at all these statuses, what they mean, and how you can troubleshoot them.
3. Your Tax Return is Received
In the first status, you will see if your return has been received or not.
So clearly, if you have not received your tax refund and the IRS has indicated that they don’t have your return, then you need to look into that a little bit further.
You may need to check and see if your return sent if you did an E-file or electronic filing.
Sometimes if the Internet blew out and you lost connection then your tax return could get stuck in software.
In addition to that, some tax software has safeguards in place that will automatically reject sending your tax return to the IRS if it is missing some key information like your date of birth or your last name.
Any good tax software will be able to indicate to you if the tax return was successfully sent to the IRS or not.
Another reason why the IRS may not have your tax return is if you filed it through the mail.
Due to everything that has happened in 2020, the IRS is seeing some major mail delays which could hinder them from being able to process your mail in your tax return quickly.
That’s why here at LYFE Accounting, we always recommend simply doing an e-file or electronic filing if you want your return to be received as soon as possible.
4. Your Tax Return is Approved or Rejected
So if the tax return was approved, then you will simply progress to the next stage which is getting your refund sent.
But if your tax return was rejected, if it was REJECTED, then you got to start all the way over.
And this is just going to make getting your tax refund in 2021 much longer.
So here are the two reasons why we see your tax return may be rejected:
a. A typo in the area of the first name, last name, date of birth, or Social Security number.
If the IRS cannot verify who you are within the tax return, it is likely going to get rejected. Well, not even “likely”, it will get rejected.
b. You claim something like a child that someone else has already claimed.
So if someone like a family member or a spouse claims a dependent and then files their taxes before you, then they are going to be the ones that get the tax credit or deduction.
And, you are going to get rejected.
We’ve actually seen this happen before, actually many times. So, if this does happen to you, we’re sorry there’s really nothing you can do, at least immediately.
You just have to go to the person who claimed the dependent that you were planning on claiming and then work something out between the two of you.
Or, file what is called an amended tax return.
This by the way, if you happen to have to file an amended tax return, the process for getting your tax refund in 2021 can take eight weeks or even more.
So if you’re looking to get your tax refund fast, that should be your last option.
5. Your Tax Refund Has Been Sent
If you get this status then that means your refund has been sent to you either via mail or directly deposited into your bank account.
But we’ve seen people get this status and they still don’t have their refund. So what exactly is going on?
Two big things that we see when you have this status and you don’t have your refund.
a. If You Chose to Get Your Refund Via Mail
If the IRS says your tax refund for 2021 has been sent and you filed by mail, then try to give it about 7 to 10 days to actually come to your mailing address.
Again, there have been some major mail delays that have been going on.
Now after 10 days, you still don’t have it then go back to your tax return and make sure you gave the IRS the correct address.
We’ve seen before with our clients that sometimes they gave the IRS an old address or a secondary address like a family member’s house.
If this is the case then you will want to go to the IRS website, log into your account and update your address.
If these two things don’t help you then keep reading to see if it could be something else.
b. If You Chose to Get Your Refund Via Direct Deposit
If you chose to get your refund direct deposited and you don’t see it in your account and your status is “refund sent”, here’s what you need to look at.
First, call your bank to see if the deposit is on its way and just hasn’t cleared yet.
That will help a lot of the time. If it doesn’t, then go back to your tax return and make sure you gave the IRS the correct bank account number.
We’ve seen this happen and this is the worst possible outcome because one of two things could happen.
For one, the refund could have been deposited into someone else’s account which will be very difficult to reverse.
You are going to have to go through a lot of bank and IRS confirmations. And we all know how slow both of them can be.
The second scenario is that the tax refund bounces back to the IRS because the deposit didn’t go through. And when that happens, the IRS will send a check by mail.
Which you should know by now that there are major mail delays already for people who have submitted their returns accurately.
So we can imagine that they will be even longer for someone who did not submit the right information.
The last time we’ve seen this happen, it took about eight months for our client to receive their tax refund.
So if you haven’t filed yet or when you file in the future, make 1000% sure you have given them the right bank account number for your tax refund.
4 Things to Consider If Your Refund Status Has Been Sent But Still Haven’t Received It
Now if the account number is correct and the status is that your refund has been sent, then we still need to look a little bit deeper.
Here are 4 more things to consider.
1. You owe taxes from a previous year.
Because If you owe taxes then it is very possible that the IRS will see that and use any tax refunds to apply against your tax liability.
This is pretty clear, but we see it all the time when clients just simply forget about the tax liabilities that they still need to pay off when thinking about their tax refund.
2. You owe someone money.
For example, if you owe child support, then it is very possible that your tax refund in 2021 can be garnished and used to support your other government liabilities.
Now you will likely know if the first two happen to you because the IRS will usually send a letter confirming how your tax refund was used to pay your liabilities.
3. Your tax accountant took your tax refund to pay themselves.
If you did not pay your accountant an upfront fee to do your taxes then some systems are set up to take a cut out of your tax refund for their tax fees.
So for example, if you were supposed to get back an $800 refund and your tax accountant charges $800 then you would end up not getting any additional money.
Most accountants will tell you this upfront, so you know what to expect. But there are some sketchy tax people who will overlook this information.
Some tax companies will even give you a loan for your refund in advance that you will have to pay back later.
So again, be mindful of this because it is also overlooked and a big reason why you may not be seeing any deposits into your account or checks in your mail.
4. You owed the IRS.
Now if you’ve checked all of this and you are still waiting for your refund and you are 100% sure that you are getting a refund…
Then the IRS could just be experiencing some delays on their end getting to your return.
After a crazy 2020, and all the stimulus checks and unemployment benefits and loan programs, it’s not difficult to imagine that the workload for the IRS has increased.
The IRS even put some of these delay notices on their website.
So all you can do is be patient and hope that your tax refund for 2021 comes in eventually.
Now if you’re still very concerned and it’s been more than three months then we would advise calling the IRS, even though they say not to and explain to them your specific situation.
As you can tell, there are a lot of self-inflicted reasons why you may not have received your tax refund in 2021.
And as a tax professional, checking our clients and checking ourselves before we assume something with the IRS is always the first step.
We hope you learned a thing or two in this post. But if you need more help with your tax situation, our tax consultants are here to help you out.
Don’t hesitate to contact us today!