Each year, 3 out of 4 taxpayers get an IRS refund with their filed tax return. The IRS advertises that more than 90% of all refunds are paid within 21 days of filing. The exception are refunds that have “refundable credits,” such as the earned income tax credit or additional child tax credit. These credits can trigger or increase a refund even if you do not owe any tax. By law, refundable credits are not paid until after February 15th of each year. This allows the IRS time to verify that the credit should be paid. In 2024, 2023 returns with refundable credits were not paid until February 27th, 2024.
The IRS has an online tool to track your refund call the IRS’ “Where’s My Refund?” application (“WMR”). It is the most used IRS online tool by taxpayers and it does not require the taxpayer to have an IRS account (ID.me authentication) to access the application.
The WMR application can be used to track the refunds for the current processing year and prior two years.
The taxpayer does not need to create an IRS online account (ID.me authentication). However, the taxpayer will need to authenticate themselves by providing correct information including their:
- Taxpayer identification number (i.e., SSN or ITIN),
- Filing status, and the
- Exact refund amount.
Using the WMR Application
The WMR application will not immediately update you on your refund after your return is filed with the IRS. You can start to use the application to track your refund status based on what tax years you file and whether or not you e-file your tax return (note: more than 90% of taxpayer e-file their tax return with the IRS). You can check your status:
- 24 hours after you e-file a current-year return
- 3 or 4 days after you e-file a prior-year return
- 4 weeks after you file a paper return
The WMR application basically provides three types of status updates on your refund:
Where’s My Refund shows your refund status:
- Return Received: the IRS received your return and is processing it.
- Refund Approved: the approved the refund and is preparing to issue it. An estimated date will be provided when the refund will be issued.
- Refund Sent: the IRS will show when the refund was sent to the bank account indicated on the return or by mail. The refund may take yup to 5 days for it to be credited to the bank account. If a check was issued, it will usual arrive within 2 weeks.
Delayed refunds
The WMR application will also show when the refund is delayed or being held. The most common reasons refunds are taken or held are for:
- Suspected Refundable Credit issues: the IRS may delay a refund if there are problems with the information provided to claim the Earned Income Tax Credit and Additional Child Tax Credit. In these cases, the IRS will issue a letter about the discrepancy and what the taxpayer needs to do next. Most discrepancies involve verification of income (W-2s, 1099s), dependent claims, and filing status issues.
- Potential Tax Identity Theft: tax identity theft IDT) occurs when a thief steals the taxpayer’s personal information. The identity thief files a false tax return and attempts to steal a fraudulent refund. The IRS filters tax returns for suspected IDT. If IDT is detected, the taxpayer is sent a notice (usually a Letter 5071C) to verify their identity. The IRS allows some taxpayers to verify their identify online. Others may be required to call the IRS to verify their identity. Suspected IDT does not mean that someone has stolen the taxpayer’ identity- it may just mean that IRS filters detected possible identity theft.
- An error was made on the return: there are many types of errors that can delay processing of a return including missing forms or signatures, a mismatch of income reported on the return v. Forms 1099 and W-2 filed, healthcare tax credit reporting, and other issues. In these cases, the taxpayer will receive a notice from the IRS requesting additional information. The taxpayer will likely be able to send the information by fax or upload it to the IRS online to complete the return.
- The refund was used to pay a debt: the IRS will use refunds to payoff prior taxes owed. In this case, the IRS will issue a notice to the taxpayer telling them how their refund was applied (usually a CP49 notice). The IRS can also use the refund to pay outstanding non-tax debts, such as back child support or student loans in arrears. These offset payments are triggered by the Bureau of Fiscal Services. In these cases, the taxpayer will receive a letter from the IRS and a letter from the Bureau of Fiscal Services (BFS). The BFS letter will describe why the refund was taken.
When to call the IRS
Delayed refunds occur about 10% of the time. A taxpayer should start to look to take action if they have not received their refund within 3 weeks. The WMR application will direct the taxpayer to call if needed. However, taxpayers can be proactive and contact the IRS if they have not received their refund within 30 days or the prescribed time called for on the WMR application. Any discrepancies should be investigated and resolved quickly. Taxpayers can call and speak to a live IRS representative using the 1-800-829-1040 service number. Post-COVID, the Customer Service hotline has low wait times during tax season (Jan. – April). This phone line is open only during weekdays.