Everything seems to have slowed down these days, thanks to labor shortages and supply chain issues, and the IRS is no exception to this. The IRS has been working with roughly the same number of employees since the 1970s, despite the number of taxpayers increasing significantly over the last 50 years. Add to this a high number of absences due to illness, the added labor of issuing advanced child tax credit payments and stimulus checks, and the delayed tax deadline for the past two years, and you may begin to understand why the IRS is behind on processing returns. But will their slowdowns impact your return? Keep reading to learn more about how these might delay your tax refund.

How Big Is the Backlog?

Perhaps you’ve heard a little bit about the IRS’s backlog of unprocessed returns from last year, but just how far behind are they? It might surprise you to learn that a backlog is actually completely normal. Most years, the IRS will have about 1 million unprocessed returns from the previous tax season when the next tax season begins. If that sounds high, you’ll be even more surprised to learn how many unprocessed returns they had at the end of 2021—approximately 6 million.

As you might imagine, this level of backlogged work can hinder the IRS’s ability to process 2021’s tax returns efficiently. A similar situation occurred when processing 2020 tax returns at the beginning of 2021. At that time, more than 30 million taxpayers had their returns and refunds delayed, and it’s very possible that this will happen again.

How Likely Is It That Your Return Will Be Delayed?

The good news about filing your return is that a large portion of the process is automated. This means that, if you file electronically, there’s a good chance that you won’t experience delays with your return being processed. The IRS has stated that most returns will be processed and refunds given within 21 days of filing.

However, now that we’re into the last full month of tax season, delays will become a bit more common. Filing early is usually the best way to get your return processed quickly; in fact, the IRS had processed over 4.3 million refunds by the middle of February for those who had filed early on in tax season. But the later we get into the year, the bigger the pileup of returns to be processed, so if you’re still waiting to file, you may be waiting more than 21 days to have your return processed and refund issued to your account.

Common Causes of Delays on Tax Returns

In addition to filing later in the tax season, there are a few other items that can cause delays in processing your tax return. These include:

  • Claiming the Child Tax Credit or Earned Income Tax Credit – If you qualify for these credits, you should certainly claim them on your return. However, be aware that claiming either of these credits can delay your return a bit. This is due to certain regulations designed to deter fraud.
  • Incorrect statement amount for advanced Child Tax Credit payments – Incorrectly reporting the amount you received in advanced Child Tax Credit payments can also cause delays on your return. Unfortunately, some taxpayers may state the incorrect amount through no fault of their own. The IRS announced that some taxpayers were issued a Letter 6419 with an incorrect amount listed. If you use that letter to file your return (as instructed by the IRS) and the amount on it is wrong, it will likely cause delays in processing your return.
  • Other math errors – Incorrect calculations are not uncommon on tax returns, but they will certainly cause delays. If you enter any numbers incorrectly, those simple miscalculations can cause major issues.

How to Get It Processed Faster

What else can you do to help get your return processed more quickly? Here are a few tips:

  • File electronically – Paper returns always take longer to process.
  • Opt for direct deposit of your refund – This processes much more quickly than waiting for the IRS to issue a check.
  • Be precise in your calculations – As your math teacher told you, always double check your work.
  • Save all IRS documents – This can help you to address any problems more quickly.
  • File as soon as possible – Though it’s already getting late into the tax season, waiting until April will almost always delay your return further.

If you’re worried about your return being delayed, contact Peter Witts CPA today and schedule an appointment with one of our tax experts. We’ll help you prepare your return quickly, double check it for accuracy, and file it electronically to minimize the chances of delays.