The IRS finally made it through a backlog of tax returns caused by COVID 19-related delays.
The agency had a backlog of about 17 million paper-filed Form 1040 tax returns at the close of the 2021 tax-filing season, but by the end of 2023 that backlog was virtually eliminated, according to the National Taxpayer Advocate Erin M. Collins’ 2023 report to Congress. The IRS also substantially improved telephone service last year, she said.
Still, it takes longer to process some returns than others, and there are steps you can take to help avoid delays. Keep in mind that the bureau has to pay interest on the money you’re due if you don’t receive your refund within 45 days of the filing deadline. Here’s how to get your refund faster:
File Electronically and Opt for Direct Deposit
Filing your return electronically is the No. 1 thing you can do to speed up the refund process. The IRS estimates that the average taxpayer will receive their refund within 21 days if they file electronically and have the money deposited directly into their bank account.
The IRS has to review paper returns manually, which continues to delay refunds.
“The e-filing system works so well because taxpayers and their preparers are doing all of the key-punching that fell to the IRS employees in the past,” Mary Kay Foss, a CPA in Carlsbad, California, says.
You can file electronically using tax software or an online program. If your income was $79,000 or less in 2023, you may be able to file your taxes through IRS Free File, a program in which online tax prep companies partner with the IRS to provide free services. See the IRS Free File page for more information.
To have your refund deposited directly into your bank account, you’ll need to provide your bank account and routing numbers when you file your return, says Michael Trank, a CPA with Wertz & Company in Irvine, California.
[Read: How to File Taxes for Free.]
You can also split your refund among financial accounts — including checking, savings, individual retirement accounts, eligible health savings accounts or Coverdell education savings accounts.
Or, you can use at least part of your refund to buy up to $5,000 in Series I savings bonds. Another option is to have your refund applied to your 2024 estimated tax.
“Always double-check the bank information where your refund is going to be deposited,” Trish Evenstad, an enrolled agent at Evenstad Tax & Financial Services Inc. in Westby, Wisconsin, says. Processing can be delayed if the name on the account isn’t the same as the name on the tax return.
Review Your Return for Mistakes
Check your return before you send it. Make sure all Social Security numbers and all math is correct, and don’t forget to sign the return.
“Common errors will delay processing,” Foss says.
“Many errors can be prevented if one spouse reads all the information on the return before the preparing spouse submits it. That’s where a professional preparer helps. They’ll have systems to find those annoying typos,” she adds.
The IRS may correct small math errors and send you a notice of the change. For larger errors, you may need to respond to an IRS letter asking for more information.
“Review the return and all schedules line-by-line for accuracy and completeness,” Trank says.
“For me, it’s useful to take a second fresh look the next day. Also, compare the return to the prior year for any unusual variances or omissions,” he adds.
Also, make sure you check everyone’s names on the return.
“Make sure to use your full legal name on your tax returns and at work so the documents match,” Evenstad says. People who were newly married in 2023 should ensure the names on their tax returns are the same as what’s on their current Social Security cards, Trank says.
[Read: Married Couples: Is It Better to File Taxes Jointly or Separately?]
And if you have grown kids, coordinate with them before either of you file a return. Foss saw problems in the past when college kids filed their own returns and claimed themselves as a dependent without notifying their parents.
“Usually, the parents’ return was filed second and the return would be rejected,” she says. Processing will also be delayed if both the parent and child claim an education tax credit for the same expenses, she says.
Review information about tax credits and deductions to make sure you take all the tax breaks you deserve when you file your return.
You generally have up to three years after the tax-filing deadline to file an amended return if you left something out or missed a credit or deduction, but the IRS is still going through a backlog of amended returns.
You can check on the status of an amended return using the IRS’s Where’s My Amended Return? tool.
[Read: How to File an Amended Tax Return]
Match the Forms the IRS Receives
You’re not the only one receiving W-2, 1099 and other forms from employers and financial institutions; the IRS gets a copy, too.
“A missing or incorrect W-2 form could cause a delay,” Trank says.
If the numbers on your return don’t match the information the IRS receives, it will put your return aside for review. You may receive a notice from the IRS showing the difference between what you reported on the tax return versus what the issuer reported, Trank says.
You should receive most of the forms by the end of January, but brokerage firms have until mid-February to send some 1099s. Wait until you receive all your key forms to file your return.
Some forms tend to come late, such as the Schedule K-1 from a partnership, S corporation or trust, Foss says. If you haven’t received the information by the filing deadline, which is April 15, 2024, for 2023 returns, you can file an extension to delay your deadline until Oct. 15, 2024.
Although the extension can delay your filing deadline by six months, any money you owe is still due by April 15. Foss recommends asking the Schedule K-1 issuer to estimate the income it will report so you can roughly calculate any payment due in time for the April deadline.
Get Faster Tax Help
The sooner you file your return, the earlier you should get your refund — and the less likely an identity thief will claim the money first. But many people wait to file because they have tax questions.
The IRS increased staffing, which helped reduce the long wait time to get questions answered, but there are also other ways get help faster.
See the IRS help page for how to track down information on the website and various ways to get your questions answered.
For example, the best way to check the status of your refund is by using the Where’s My Refund? tool, which enables you to check on your refund within 24 hours of filing electronically — or four weeks after filing a paper return.
You’ll need to input your Social Security number, filing status and exact refund amount you are due. The Taxpayer Advocate Service website also offers helpful filing information.
In addition, you can work with Volunteer Income Tax Assistance and Tax Counseling for the Elderly programs, which are staffed by IRS-certified volunteers and offer free tax help for filing returns.
The VITA program, which has been helping taxpayers for more than 50 years, is generally for those who make $64,000 or less, have disabilities or limited English-speaking skills.
The TCE program typically offers free tax help to those 60 and older. See the IRS locator tool to find a site near you.
Be careful with how you get help. Tax time is also prime time for scam artists who prey upon people who want to get their refund quickly and end up stealing their money or identity.
The IRS will not call or e-mail you asking for your personal information, such as your bank account, credit card or Social Security number.
You can find out more about when and how the IRS may contact you on the IRS website. Last, you can get information about tax preparers’ credentials by visiting the IRS Directory of Federal Tax Return Preparers with Credentials and Select Qualifications.
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The Fastest Way to Get Your Tax Refund in 2024 originally appeared on usnews.com
Update 02/21/24: This story was published at an earlier date and has been updated with new information.
