Back to top

LBCPA News

Click here to go back

Don’t Fall for these Federal Tax Refund Myths

Posted by Admin Posted on May 18 2023

Don’t Fall for these Federal Tax Refund Myths

Once people complete and file their tax return, many of them eagerly await any refund they may be owed. No matter how a taxpayer plans to use their tax refund, knowing fact from fiction can help manage expectations as they wait for their money. This tip dispels some federal tax refund myths that many people believe are fact, but they are pure fiction.

Myth: Calling the IRS, a tax software provider or a tax professional will provide a more accurate refund date

Many people think talking to the IRS or to their tax software provider or tax professional is the best way to find out when they will get their refund. The best way to check the status of a refund is through the Where's My Refund? tool or the IRS2Go app.

Taxpayers can also call the automated refund hotline at 800-829-1954 to get their refund status. This hotline has the same information as Where's My Refund? There is no need to call the IRS unless "Where's My Refund?" says to do so.

Myth: Where's My Refund? must be wrong because there's no deposit date yet

Updates to Where's My Refund" ‎and to the IRS2Go mobile app are made once a day, usually overnight. Even though the IRS issues most refunds within 21 days, it's possible a refund may take longer. If the IRS needs more information to process a tax return, the agency will contact the taxpayer by mail. Taxpayers should also consider the time it takes for the banks to post the refund to the taxpayer's account. People waiting for a refund in the mail should plan for extra time.

Myth: Where's My Refund? must be wrong because the refund amount is less than expected

There are several factors that could cause a tax refund to be less than expected. The IRS will mail the taxpayer a letter of explanation if it makes adjustments. Some taxpayers may also receive a letter from the Department of Treasury's Bureau of the Fiscal Service if their refund was reduced to offset certain financial obligations. Before calling, taxpayers should check the Where's My Refund? tool or wait for the letter to understand why the change occurred. This can help taxpayers know how to respond.

Myth: Getting a refund this year means there's no need to adjust withholding for tax year 2023

To avoid a surprise next year, taxpayers should make changes now. One way to do this is to adjust their tax withholding with their employer. The Tax Withholding Estimator tool can help taxpayers determine if their employer is withholding the right amount.

Taxpayers who experience a life event such as marriage, divorce, or the birth or adoption of a child, or are no longer able to claim a person as a dependent, are encouraged to check their withholding. Taxpayers can use the results from the Tax Withholding Estimator to complete a new Form W-4, Employee's Withholding Certificate, and submit it to their employer as soon as possible. Withholding takes place throughout the year, so it's better to take this step as soon as possible.

If you have any questions regarding Essential Business Accounting, Domestic Taxation, International Taxation, IRS Representation, U.S. Tax Implications of Real Estate Transactions or Financial Statements, please give us a call at +1-305-274-5811.

Source: IRS     

The information provided on the LBCPA Blog is a community service for general information purposes only, and should not be used as a substitute for consultation with professional advisors who specialize in the topics covered. Please refer to your advisors for specific advice on these subjects. The information is not intended to be used, and it cannot be used, for the purposes of avoiding U.S. Federal and/or State tax laws or the tax laws of any foreign jurisdiction.

These blogs contain general information only and Lord Breakspeare Callaghan LLC or any of the other companies or firms presenting information are not providing accounting, business, financial, investment, legal, tax, or other professional advice or services. Lord Breakspeare Callaghan LLC or any of the other companies or firms contributing with articles shall not be responsible for any loss sustained by any person who relies on this information.