Tax refunds: Who doesn't want one?
They've been in the news quite a bit lately, for reasons both good and not-so-good.
"It's a pretty messed-up season," said John Hogg, owner of 10 Jackson Hewitt Tax Services offices in the Sacramento, Calif., area. "The amount of refunds is far behind last year," he said.
While the Internal Revenue Service isn't putting out numbers on how many refunds have been issued so far this tax season, refunds got off to a bit of a bumpy start this year.
Blame it on an unlucky confluence of events: a late launch to the filing season, which started eight days later than usual thanks to last-minute, "fiscal cliff" tax changes enacted by Congress; the inability of taxpayers to file for some credits until early March; and more diligent scrutiny of tax returns, part of the IRS' beefed-up efforts to thwart identity theft and tax fraud.
Even Walmart said it's felt the impact of later-than-usual refunds. By this time last year, the giant retailer had cashed about $3 billion worth of checks related to tax refunds. This year, that amount is just $1.7 billion, the company said last week.
Some tax professionals like Hogg said they're seeing lots of disappointed tax filers - who either can't file yet or whose refunds are taking longer to arrive. Others, like Michael Hayes, H&R Block regional marketing manager for 50 tax prep offices from Sacramento to Tahoe, said, "In the last few days, it's gotten better. (Tax refunds) are starting to process a little faster."
In 2012, the IRS said, nine out of 10 refunds were issued in less than 21 days. "The same results are expected in 2013," said IRS spokesman Richard Panick in an email.
At Jackson Hewitt, Hogg said refunds have especially been slower for many lower-income taxpayers who qualify for the Earned Income Tax Credit. For single head of household filers with two young children, that refundable credit could mean $7,039 in their pocket.
"It's the most significant financial event for them for the year. And now it's all up in the air," Hogg said. "They don't know when they'll get their refund."
In recent weeks, so many taxpayers were using the IRS online tool, "Where's My Refund," the IRS had to issue a plea: Don't check it more than once a day.
Once you've filed a federal tax return, the popular tool on IRS.gov lets you track your refund's progress: when the return was received, when a refund was approved and sent out.
With an e-filed return, you can check within the first 24 hours after it's filed. With a paper return, check four weeks after you mailed it.