Are you still waiting for your 2020 tax returns? Well, join millions of others who are still waiting for their check. The IRS is still faced with unprocessed 2019 tax returns in addition to the backlog generated due to the domino effects of the COVID-19 pandemic.
When the IRS shut down their processing centers for three months and then brought back a limited staff because of social distancing requirements, the ever-increasing delay was bound to happen. Couple that with the distribution of third-round federal stimulus payments being the priority and the federal agency is having a difficult time keeping up.
People might be wondering, if the IRS can distribute approximately $800 billion in stimulus checks over three rounds of payments, then why is it taking so long for tax returns?
Part of the slowdown comes from manually processing the paperwork due to the COVID relief measures that included both the recovery rebate credit and earned income tax credit (EIC), which people can claim one or both. The recovery rebate credit allows those who did not receive all of the first two rounds of stimulus money that they were eligible for to claim that money on their 2020 tax return while the EIC is designed for low-income households. Because people may (or may not) qualify for both, many of the millions of the prepared tax filings need to be examined. This has greatly contributed to the backlog of processed refunds.
Pushing the deadline to file taxes to May 17th may have helped those who needed a couple of extra weeks to pay their taxes but this only compounds the delay for those expecting a refund. Typically, a refund is issued within 21 days, or up to six weeks if a check is requested.
For many, the wait time for the tax return is two months and counting. With staffing shortages, equipment breakdowns, and the backlog, you may expect much longer wait times. As for the Biden administration, their proposed solution is to give the IRS more money to help alleviate staffing problems but that means taking time to train the new people.
Keep waiting and keep checking. Your tax refund will come… eventually.