(FiveNation.com)- The year hasn’t even ended yet, and already the IRS is warning taxpayers that they shouldn’t bank on getting tax refunds by a specific date next year.
Even if they are able to file their returns early next year, the review process could take longer than normal, according to the IRS. The agency is already experiencing a massive backlog, and millions of people are still waiting for their returns from last year to be processed.
The annual tax filing season usually opens up sometime in January. The IRS hasn’t announced the date yet when it will start to accept tax returns. Some taxpayers try to get this done as soon as they can so that they can get their tax refunds back in their pocket to pay for things such as bills, debt or to reward themselves.
Data from the IRS showed that last year, nearly 110 million U.S. households received a tax refund that averaged $3,200. The tax agency warned that this time around, these same taxpayers shouldn’t expect that they’re going to get their refund by a specific date.
Last month, the agency said:
“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.”
At the same time, the IRS did say that most of their tax refunds are sent within three weeks. There are some issues that can cause a delay in that happening, though, such as if the form is filed by paper. In those cases, the IRS has to process the returns manually, which it said might take six months or even more for them to complete.
When taxpayers claim certain credits, such as the Earned Income Tax Credit, their returns might take longer to process and issue a refund as well.
The IRS also issued a heads-up that many taxpayers could receive smaller refunds in 2023 than they have in recent years since many of the pandemic-era benefits have no expired.
Tax experts have said that the $3,200 average refund filers received last year was a 14% increase from the year before. This year, the average refund check could end up being closer to $2,700.
While the pandemic ended up putting more money in taxpayers’ pockets from refunds, it also created a host of challenges for the IRS. The agency has been hiring thousands of employees to help them get better prepared for the 2023 tax filing season.
As of September, the IRS backlog of annual tax returns swelled all the way up to 12.4 million that still needed to be processed from the 2022 filing season. According to the Government Accountability Office, which is a watchdog agency, that represented an increase of about 1.9 million returns still outstanding at the same time back in 2021.
Because of this backlog, millions of taxpayers are still waiting for their refunds to be processed and sent to them.