How Long Does It Take the IRS to Process a Tax Return?
Tax returns in the U.S. are a massive part of your yearly financial planning. You will need to complete a tax return each year by June 15 if you’re living abroad (outside of the United States) for the previous year to declare any money earned, any assets owned or any investments, whether in the U.S. or overseas.
Sometimes, due to the amount of money you’ve earned and any deductions you’re due, you may be entitled to a tax refund. For this reason, the question, how long does it take the IRS to process a tax return is incredibly important.
How Long Does It Take for the IRS to Process a Tax Return?
If your tax return is submitted on time (by June 15) and is all correct with no queries raised, then it typically takes the IRS around six to eight weeks to process a tax return and issue any refunds from the date that they receive it if you submit in the traditional paper document format.
However, submitting electronically can mean that you receive a refund as quickly as three weeks from the submission date, just because the tax return is easier to fact check.
If you’re sending your tax return by mail, expect the IRS to take a few months to process your return.
The IRS has a huge backlog due to Covid and they’re trying to catch up, but there are still millions of tax returns not processed.
If you’re filing under the protection of the IRS Streamlined Tax Amnesty program between 2020 and 2023, expect the IRS take up to 6 months to process your returns and issue any Stimulus payments or Child Tax Credit Refunds.
How To Submit a Tax Return
The fastest and most effective way to submit your tax return is online. Although paper-based filing is still completely acceptable, it is a more complex way to process your return and it’s not recommended for people who aren’t used to doing this.
If you’re an expat or US citizenship holder living abroad, get professional help to prepare your US federal tax return, and State tax return if required.
Some professional US tax firms have IRS e-filing capability so they can submit your tax return electronically in a matter of minutes.
What Happens When I Submit My Tax Return?
When you submit your tax return online, it goes through a standardized process to help you receive any refunds a little faster.
- First your return is stamped with an electronic postmark to confirm receipt. This means that you won’t receive a late filing notice.
- The IRS checks your personal information to make sure that it matches everything that they already have about you on their records.
- Once everything has been confirmed, you then enter the IRS payment timetable.
- Typically, it takes the IRS 21 days to confirm if a refund is due from this time. You’ll be able to check your refund status almost immediately after the IRS accepts your return by visiting the IRS ‘Where’s My Refund?’ online tool.
- Once a refund and amount has been confirmed, the portal will then display the expected refund date. If you chose a direct deposit method, this may even be within a few days.
How Do I Receive My Tax Refund?
The IRS has several methods of processing and delivering a tax refund if you are entitled to one. You will be asked to select the method of choice during the tax return process just in case you are entitled to one.
You may select:
- Direct deposit to your bank account. This method is the fastest way to receive your refund because the U.S. Treasury is able to submit the payment electronically. It is also the more secure method as there’s no check to get lost. The option for a direct deposit to your bank account is available through both paper-based and electronic filing methods.
- Check in the mail. If you’d rather cash your check in a different account to the one you’ve registered electronically, or require a check for business audit reasons, then you can also request to have a check sent to you when you file your form.
If you’re expecting a Child Tax Credit Refund for older tax years, you’ll receive the payment by check, even if you’ve provided US bank account details.
Typically, only current-year payments will be paid electronically to a US bank account.
As of 2022, the IRS will only send electronic payments to US bank accounts.
What if I’m way behind on my U.S. tax returns?
There is a special IRS program to help you catch up on your U.S. taxes safely, without fines and penalties
It’s for American citizens that didn’t know they had to file U.S. tax returns each year, and have therefore fallen behind. Some more than 30 years! With the IRS Streamlined Procedure, say goodbye to overdue tax returns, late fees, and penalties. If you have children, we can backdate your Child Tax Credit Refund for 3 years.
Get a quote here.
Why Might There Be a Delay with My Refund?
If you haven’t received any news regarding your tax return after 8 weeks (or 3 weeks if you filed electronically), then it may be worth contacting the IRS to view its progress. Usually, the reason for a delay is down to a detail on your tax return being incorrect. The most common mistakes made on a tax return are:
- An incorrect social security number – meaning the tax return cannot be traced back to you.
- A missed signature – if you don’t sign your tax return, then it cannot be processed.
- Missing attachments – parts of the tax return require you to send off documentation to support your declaration. These could be wage or tax statements, declarations of investments or proof of overseas accounts.
- Calculation errors – Often, due to the complexity of filing a tax return and the changes in filings rules, people may make errors in their calculations, showing that the amount earned or owned is different to the IRS records. This means that the IRS will have to take extra time to correct your mistakes.
You can contact the IRS for a status update using the IRS TeleTax System at 1-800-829-4477. You’ll need to provide your Social Security number, your filing status and the amount of refund that you feel you’re entitled to.
If you’re unsure if you’ve filed everything correctly and have all the right documentation attached, it’s worth seeking the advice of a professional tax service to look over your return before submission. Errors can mean that you don’t receive your refunds when you should and can even cause you to receive penalties.
What Happens If There Are Errors on My Tax Return?
If the IRS finds an error on your tax return, they will need to spend time correcting this.
If you’re lucky, this will mean that there’s just a delay with receiving your refund. Minor errors that can easily be corrected just take an extra few days to process.
However, if the IRS notices large errors in your calculations or missed declarations of assets, they may deem that you have knowingly failed to declare everything on your return in an attempt to hide your wealth and therefore, pay less tax. In this case, penalties may be issued in a minimum amount of $10,000. Your accounts will also be monitored for years after this incident and further inaccuracies will start to cost more money.
The IRS won’t accept an unsigned tax return. If you forget to sign or make large mistakes on your return, this may be discounted, meaning that you could be asked to start your return again. If you didn’t file early, then this could lead to a late filing, also incurring penalties.
If you’re struggling to pull all the documents together for your return, or you are unsure if you’ve done everything correctly, you are able to request an extension until October of the year that you’re filing. This will give you time to pull all your documents together and seek some professional help.
Do I Get a Refund Early If I File Early?
Actually, no. There’s a misconception that if you file earlier, then you’ll get your refund a little quicker. The IRS does actually open its doors to returns until the end of January following the year that your return should be filed for. You’ll then have between January 31 and April 18 to file your return.
However, as many documents won’t be received immediately at the end of the previous year, especially if you own businesses, property or stocks and shares or if you own any assets overseas where the tax submission dates differ, then it could actually be detrimental to file earlier.
If you miss a valuable document or miscalculate your earnings due to something that you haven’t received just yet, then it could lead to you receiving a refund later because the IRS will have to take extra time to correct your mistake.
Your miscalculation could even lead to your taxes being read incorrectly be the IRS, meaning you may not even qualify for a return or could be forced to pay penalties for filing incorrectly.
The IRS actually advises against filing too early to avoid these issues.
Support to File My Tax Return Correctly
For those that need a little extra support when filing, there are some free online tools including the IRS’ Free File Program. It allows people with a gross income of up to $73,000 to use a free tool that guides them through the filing process at no extra cost. This supports low-income earners and helps them avoid penalties if they aren’t familiar with the filing process.
However, if you’re a higher income earner, there are still services out there to help you file and get all of your ducks in a row. Seeking help from a professional tax filing service will give you the peace of mind that you haven’t left anything out and won’t incur penalties. The service will also take a look at your personal circumstances to determine which method of filing will work best for you and will help you to understand which forms need to be sent alongside your return to declare assets and overseas investments.
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