2017 Tax Refund Payment Delays For Returns With Earned Income and Child Tax Credit Payments

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It looks like we may have a repeat of 2016 tax refund payment delays millions of American’s faced (and are still facing) this year. The IRS recently warned that there will likely be 2017 tax refund delays (for 2016 taxes due by April 15, 2017) for certain taxpayers subject to several new factors and legislation enacted in the past year.


Hence the IRS is urging tax payers to look closely at their tax withholding to ensure the right amount is being withheld. If too much is withheld then the people would expect a fatter tax refund in 2017, but with likely delays it could take quite a while to receive this. So only withhold what you have to and avoid giving the IRS a free tax payer loan.

“We don’t want people caught by surprise if they get their refund a few weeks later than previous years,” said IRS Commissioner John Koskinen. 

Tax law changes around two key tax credits are driving the IRS’ warning to review your withholding. One is the new law to hold tax refunds a few weeks for some early filers in 2017 claiming the Earned Income Tax Credit and the Additional Child Tax Credit. Under the Congress Act – Protecting Americans from Tax Hikes (PATH) – the IRS must hold the entire refund — even the portion not associated with the EITC and ACTC — until at least Feb. 15th.  The additional time helps the IRS stop fraudulent refunds from being issued to identity thieves and fraudulent claims with fabricated wages and withholdings.

In addition, the IRS and state tax administrators continue to focus on and deal with identity theft and refund fraud which are expected to increase in the 2017 tax season. This will mean even more tax returns could again require additional reviews which all this takes extra time with the staffing/budget constraints at the IRS. 

You can see key deadlines and filing dates for the 2017 tax season here.  The IRS is still recommending that tax payers file as usual and is expecting most refunds (where applicable) to be issued within the normal timeframe: 21 days or less, after being accepted for processing by the IRS.

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Jonah February 15

3:54PM CST. The IRS just sent out a press release. The IRS Where’s My Refund tool will not update until February 16th, 2017 for those that still have the PATH act message. It will begin updating WMR on February 16th through February 18th for the vast majority of EITC/ACTC taxpayers.

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bre roberts February 3

I glanced over the Protecting Americans from Tax Hikes (PATH) of 2015 but could not find any issues corrrelating to the Path writings to holding refunds until Feb 15th, 2017. How are they related? And why is this excuse being used from the IRS? Honestly, if the IRS continues to delay refunds, many, many people will create a backlash of negative publicity. However, the IRS’s response then…with the federal cuts in IRS spending, they are understaffed!

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