What is the difference between being processed and still being processed

The Internal Revenue Service (IRS) is hard at work processing income tax returns but the covid-19 pandemic has put additional strain on the agency. Depending on how you file your return will affect the amount of time the IRS will need to process your return. In the vast majority of the cases the IRS issues refund in 21 days.

However some people are in a bigger hurry than others to see that refund appear in their bank account. The IRS says that you can check the status of your refund on their Where’s My Refund? online tool within 24 hours after they receive e-file return or 4 weeks after you’ve mailed a paper return. When you check the site you may see a message that reads "Being processed", which means the IRS must first process your return and then approve your refund.

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You still haven’t seen your refund after 21 days

Some tax returns take longer to process than others for a number of reasons. This year people will be navigating their 1040 perhaps with conditions dramatically different than in years past which could lead to errors. The IRS will contact you by mail in the event that they need more information from you.

• Includes errors
• Is incomplete
• Is affected by identity theft or fraud
• Includes a claim filed for an Earned Income Tax Credit or an Additional Child Tax Credit. See Q&A below.
• Includes a Form 8379, Injured Spouse Allocation PDF, which could take up to 14 weeks to process
• Needs further review in general

Checking the status of a refund

The IRS advises that if you want to talk to a representative in-person that you will have to wait 21 days after you filed electronically and 6 weeks after you mailed your paper return. You can also check in Where’s My Refund? The agency may have posted a message for you to contact them there.

The handy resource is updated daily, generally during the night. It tracks your refund from the time the IRS receives it to the time they send out your payment and you can access it online with three pieces of information:

• Your social security number or ITIN
• Your filing status
• The exact amount you are owed in the refund

Simply select ‘Check My Refund Status’ on the website and submit your details to get an up-to-date look at the progress of your tax refund. It should be noted that the IRS are predicting longer waits than usual this year. The pandemic has made it particularly difficult to process mailed documents so they warn that it could take more than 21 days.

Checking the status of an amended refund

Everyone makes mistakes and every now and then people need to amend the tax return that they filed. The Where’s My Refund? Tool does not work in this situation. You will need to visit another tool called Where’s My Amended Return? You’ll need to be patient though, as it takes the IRS more time to process these refunds.

If you’ve submitted your federal tax return and are checking the IRS Where’s My Refund? tool to find out the status of your refund, you may be wondering what “your return is being processed” means.

It means the IRS “got your tax return, so you don’t have to sweat that there was an issue with them receiving it,” says Howard Samuels, a certified public accountant at Samuels & Associates in Florham Park, New Jersey.

Typically, the IRS processes most returns and issues refunds within three weeks or 21 calendar days of receipt. But recently, there have been logjams. One way to speed things along is to make sure you file electronically with direct deposit, avoiding a paper tax return, IRS commissioner Chuck Rettig said in a statement on January 10, 2022.

Here’s what you can do if you suspect your federal tax refund is delayed or you need more information about your return.

How to contact the IRS: ‘Your best bet is to call first thing in the morning’

If there’s a backlog, prepare to wait a few more weeks than normal, Samuels says. “At this point I would say sit tight for at least four to six weeks. After that, you may want to call the IRS to find out what’s going on,” he says.

In 2021, taxpayers who called to ask about their financial situations had just a 1 in 9 chance of being answered — and those who did get through lingered on hold for an average 23 minutes, according to an annual report from the Taxpayer Advocate Service.

“Your best best is to call first thing in the morning as soon as the IRS opens at 7 a.m. ET,” Samuels says. “I’ve also heard some people have luck when they call later in the day around 6 p.m. or 6:30 p.m. [Eastern] right before the IRS closes at 7 p.m.”

The IRS owes you interest on late refunds

If it takes a while for you to get your money from the government, there is a silver lining, Samuels says: “The law requires the IRS to pay interest on any delayed refund checks.”

If you don’t receive a refund within 45 days of the tax filing deadline, the IRS will owe you interest.

In 2020, the IRS owed many taxpayers interest on late refunds. The average interest payment was $18.

“If you’re waiting on a bigger refund, that could be real interest, and it compounds daily,” Samuels says.

This content is provided for informational purposes only and is not intended to provide, and should not be relied on for, accounting, legal, or tax advice. Consult your accountant, tax, or legal advisor regarding such matters.

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