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Don't bank on getting your tax refund quickly, IRS cautions

Many taxpayers can expect smaller refunds
Many taxpayers can expect smaller refunds in 2023 04:33

The IRS is cautioning U.S. taxpayers not to bank on getting their refunds by any specific date when they file their returns in early 2023. 

The tax agency recently said some returns may need extra time to review, and thus could take longer to process. The alert comes as millions of taxpayers are still waiting for their returns to be processed from prior filing seasons, with an already massive backlog at the IRS growing even larger in the past year, according to a government watchdog agency. 

The note of caution comes as taxpayers will soon begin filing their 2022 tax returns, with the IRS typically opening the filing season in January. While the IRS hasn't yet announced when it will begin accepting tax returns next month, many taxpayers file as early as possible in order to get their refunds quickly in hand — refunds which are often used to pay down debt, pay bills or to make big purchases. 

Last year, almost 110 million households received an average tax refund of almost $3,200, according to data from the tax agency. But the IRS is warning Americans not to count on getting that check by a specific date in early 2023.

"The IRS cautions taxpayers not to rely on receiving a 2022 federal tax refund by a certain date, especially when making major purchases or paying bills," the tax agency said in November.

Still, most refunds are sent within three weeks, the IRS has said. But certain issues can slow down a tax refund, such as if a taxpayer files via a paper form, which must be processed manually and can take six months or more to be completed, the agency said. And returns that claim some tax credits, such as the Earned Income Tax Credit, also may take longer for filers to get their refunds.

Smaller refunds in 2023

The IRS is also cautioning that taxpayers may receive smaller refund checks in 2023 because of the expiration of many pandemic benefits that had been designed to help Americans cope with the crisis.

That means millions of households could receive a tax refund shock when they file their 2022 returns early next year. The typical tax refund of almost $3,200 this year represented a 14% jump from the prior year — but the average check early next year may return to amounts received in prior years, around $2,700, according to tax experts.

The last three tax seasons have been brutal for many taxpayers, with millions of returns caught in limbo as the pandemic posed a series of challenges for the IRS. The tax agency is hiring thousands of new employees with the goal of being better prepared for the 2023 tax filing season. 

The backlog of returns had swelled to 12.4 million returns still being processed as of September, an increase of 1.9 million returns from a year earlier, according to the Government Accountability Office, a watchdog agency. That means millions of Americans have had delays in getting their tax refunds, the agency noted.

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