Why did the irs take some of my refund

• You can use the IRS Where’s My Refund? tool or call the IRS at 800-829-1954 to check on the status of your refund, beginning 24 hours after you e-file. The IRS will provide an actual refund date as soon as your tax return and refund are approved.

"Where's my tax refund?"

Ever wonder what happens between e-filing your tax return and receiving your refund?
Here is what really happens when you press that green button and transmit your tax return.

  • First, we "stamp" the return with an electronic postmark, and then we send it to the government.
  • Then we both wait 24 to 48 hours for the IRS to accept your return.
  • What are they doing? They are checking your personal information to make sure it matches their records.
  • If everything looks good, the IRS accepts your return.

Once you are accepted, you are on the IRS payment timetable. Only the IRS knows the status of processing your tax return, whether you owe taxes or are due a refund. In prior years, the IRS issued more than 9 out of 10 refunds to taxpayers in less than 21 days last year. The same results are expected for 2021.


 

TurboTax Tip: You can use the IRS Where’s My Refund? tool or call the IRS at 800-829-1954 to check on the status of your refund, beginning 24 hours after you e-file. The IRS will provide an actual refund date as soon as your tax return and refund are approved.


 

Once you have e-filed your tax return, there are a few ways to check the status of your refund:

  • You can use the online IRS Where’s My Refund? tool (fastest option)
  • Call the IRS at 800-829-1954

The online tool will get you personalized refund information based on the processing of your tax return. They will provide an actual refund date as soon as the IRS processes your tax return and approves your refund. Most refunds will be issued in less than 21 days. You can start checking the status of your refund within 24 hours after you have e-filed your return.

Remember, the fastest way to get your refund is to e-file and choose direct deposit.

Other tools and refund delays

You can also use the TurboTax Where's My Refund tracking guide that will show you how to check the status of your tax refund and common reasons for delays.

These articles explain in more detail what may cause a delay:

  • Where's My Refund? Top 5 Reasons It's Been Delayed
  • Delays Due to Claiming the Earned Income Credit or Additional Child Tax Credit
  • Why is my IRS refund taking longer than 21 days? 

Let an expert do your taxes for you, start to finish with TurboTax Live Full Service. Or you can get your taxes done right, with experts by your side with TurboTax Live Assisted. File your own taxes with confidence using TurboTax. Just answer simple questions, and we’ll guide you through filing your taxes with confidence. Whichever way you choose, get your maximum refund guaranteed.

You filed your taxes before the tax deadline and were fortunate enough to get a tax refund. But what if the amount the IRS deposited in your account is less than the refund you initially saw when you submitted your tax return? You may be wondering why your tax refund is less than you expected.

There are a few reasons why refunds received from the IRS may be different than expected this tax season:

  • The IRS adjusted the recovery rebate credit calculated on your return
  • The IRS adjusted the child tax credit calculated on your return 
  • The IRS made adjustments due to differences in what is reported to them or adjustments to certain credits and deductions
  • Your refund is offset as part of the Treasury Offset Program 
  • An adjustment for Federal taxes owed for a previous year

The IRS just updated their Tax Season Refund FAQs and explain:

If your refund amount is different than you expected, it may be because we made changes to your tax return including corrections to any Recovery Rebate Credit or Child Tax Credit amounts.  Also, all or part of your refund may have been used (offset) to pay off past-due tax or debts. Refer to the FAQs below and check Where’s My Refund? for details.

Read on for more details to help you understand why your refund may be different than expected, but know that you don’t need to remember all of this come tax time. For answers to this question and anything else related to your tax situation, TurboTax Live tax experts are available in English and Spanish, year round, and can even review, sign, and file your tax return. Also, here is information from the IRS on why your refund may have been adjusted.

IRS Adjusted the Child Tax Credit on Your Return 

It is possible that your refund is less than initially expected if different information was entered for your advanced child tax credit payments than what was actually issued by the IRS. The IRS sent Letter 6419 detailing the total amount of 2021 advance payments you received and the number of qualifying children used to calculate those advance payments. If you didn’t enter an amount or entered an amount different than what the IRS has on file for you for the advance Child Tax Credit payments, this could cause an adjustment to your refund amount and cause delays. 

Note for married filers, both spouses should each receive their own IRS letter 6419. It is important that information from both letters is added together on your tax return to avoid an adjustment to your return and avoid delays.

IRS Adjusted the Recovery Rebate Credit Calculated on Your Return

It is possible that your tax refund amount is less than you initially expected because of information regarding your stimulus payments and the Recovery Rebate Credit

Did you claim a credit to recover missed or partial third stimulus checks?

For the 2021 tax year (the taxes you typically file in 2022), many Americans who did not receive the third stimulus payment, or the full amount they were otherwise eligible for, may be eligible to claim a Recovery Rebate Credit when they file their taxes. 

When completing your tax return, TurboTax has proactive guidance regarding the Economic Impact Payments, also known as the stimulus checks, and will ask you if you received a full or partial payment and the amount you received.

If you answered that you haven’t received the third stimulus checks, a recovery rebate credit is calculated increasing your refund, but if the IRS did issue it to you, the IRS will adjust your refund amount accordingly. This lowers the refund amount that was initially calculated for you when your tax return was filed. 

Or it’s possible that you may have entered a different amount of stimulus than the IRS actually sent to you when preparing your taxes, and the IRS made the adjustments. When processing your tax return, the IRS will cross-reference the information on your tax return with the information they have on file for you. So if the information regarding your stimulus checks doesn’t match IRS records, the IRS will automatically adjust your tax refund amount based on the actual stimulus payments they sent out and the information reported on Letter 6475

The IRS has announced that if there’s a mistake with the stimulus credit amount, the IRS will calculate the correct amount and make the correction and continue to process the tax return. If a correction is needed, this will cause a delay in processing the tax return and the IRS will send the taxpayer a letter or notice explaining any change. 

Some common possible reasons why the Recovery Rebate Credit amount was corrected by the IRS are: 

  • The taxpayer was claimed as a dependent on someone else’s 2021 tax return 
  • The taxpayer entered the incorrect amount of third stimulus payment issued by the IRS or none at all
  • The taxpayer did not provide a social security number that is valid for employment purposes
  • A math error relating to the calculating adjusted gross income and any stimulus check amounts already received 

If there’s a mistake with the Recovery Rebate Credit on the 2021 tax return, the IRS will calculate the correct amount and make the correction and continue to process the tax return. If a correction is needed, this will cause a delay in processing the tax return and the IRS will send the taxpayer a letter or notice explaining any change. 

Other IRS Adjustments 

While your tax return is being processed, the IRS cross-references the information on your tax return with the information they have on file for you similar to the Recovery Rebate Credit situation mentioned above. The IRS will correct any differences there may be. It is possible that amounts reported to the IRS from other sources and what’s reported on your tax return is different. 

Some common errors that result in adjustments by the IRS include: 

  • Missed income, like small interest reported on a 1099-INT or a missing W2
  • Numbers that were transposed 
  • Adjustments to certain deductions or credits 

Some of these mistakes occur when you wait until the last minute to file. However, another common issue that results in lowing a tax refund are adjustments to credits or deductions as a result of someone else claiming your dependent on their tax return. If you provide over half of the support for your dependent and you are eligible to claim them, make sure no one else is claiming them and you have accurate information for who you can claim as a dependent

Always have a discussion with your child’s other parent (if possible) about who can claim them as a dependent if you are no longer together.

If the IRS makes adjustments to your tax return, they will send you a notice CP12 regarding the adjustments they made.

Treasury Offset Adjustment

It’s possible that your tax refund may have been reduced by the Treasury Offset Program. The Treasury Offset Program oversees the collection of overdue bills owed to federal and state agencies. Different federal and state agencies, such as the Department of Education and child support, submit delinquent debts that need to be collected. These bills are then taken from tax refunds which lowers the tax refund amount deposited. 

However, not all bills are subject to a tax offset. Bills from private lenders like a late car payment or missed cell phone bill will not reduce your tax refund.

Typically the IRS will mail you out a notice if your tax refund is different from the amount you claimed on your tax return. The notice will include information on the refund you were eligible for, the amount your tax refund was reduced by, what agency the money was sent to, and contact information for that agency. 

Adjustment for Federal Taxes Owed for a Previous Year

Similar to reductions caused by the Treasury Offset Program, it is possible that your tax refund was reduced or eliminated based on federal taxes owed for a previous year.  

If you owe taxes to the IRS from a previous tax year, those taxes will be reduced from any eligible tax refund for the current year. The IRS will actually take payments for owed federal taxes from a previous year before any other federal or state agency under the Treasury Offset Program. 

If your refund is less than expected you can check IRS Where’s My Refund, which will give you the most up to date information about your refund.  The IRS will also send you a notice CP12 outlining why your refund was adjusted.

We’ve Got You Covered

Get started on your taxes today. TurboTax will ask you simple questions about you and give you the tax deductions and credits you are eligible for based on your entries. If you have questions, you can connect live via a one-way video to a TurboTax Live tax expert with an average 12 years experience to get your tax questions answered. 

You can even connect virtually with a dedicated tax expert who will prepare and file your tax return in entirety with TurboTax Live Full Service. TurboTax Live tax experts are available in Spanish and English, year round. 

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Why did the irs take some of my refund

Why did the irs take some of my refund

Written by Katharina Reekmans

Katharina Reekmans is an Enrolled Agent and a contributor to the TurboTax Blog team. Katharina has years of experience in tax preparation and representation before the IRS. Her passions surround financial literary and tax law interpretation. She has a strong commitment to using all resources and knowledge to best serve the interest of clients. Katharina has worked as a senior tax accountant, operations manager, and controller. Katharina prides herself on unraveling tax laws so that the average person can understand them. More from Katharina Reekmans

Can the IRS take away your refund?

Your tax return may show you're due a refund from the IRS. However, if you owe a federal tax debt from a prior tax year, or a debt to another federal agency, or certain debts under state law, the IRS may keep (offset) some or all your tax refund to pay your debt.

How do I know if the IRS took my refund?

You can use Where's My Refund? to start checking the status of your return within 24 hours after the IRS receives your e-filed return or 4 weeks after you mailed your paper return. Where's My Refund? has a tracker that displays progress through 3 stages: (1) Return Received, (2) Refund Approved, and (3) Refund Sent.

Why did my refund go down?

If your refund was less than you expected, it may have been reduced by the IRS or a Financial Management Service (FMS) to pay past-due child support, federal agency nontax debts, state income tax obligations, or unemployment compensation debts owed to a state.

Will the IRS let me know if I made a mistake?

If there's a mistake and the IRS sent you a notice or returned the form. If information is missing, the IRS will either return the form or send you a notice asking for specific information it needs to finish processing your tax return.