How to Find Your Tax Refund Status Using the IRS system

You've already submitted your 2023 tax return and are expecting a refund. Now, you're eager to track its where abouts. 

According to the IRS, the quickest method to receive your tax refund is through electronic filing. If you opted for direct deposit when filing electronically, you can anticipate receiving your refund within approximately 21 days. However, if you chose to mail a paper return, it might take four weeks or longer for your refund to be processed, as per the IRS. 

Why refunds take time?

Getting a tax refund can feel like a distant dream, especially while you wait for the money to hit your account. There are several reasons why processing takes time, and the method you choose to file your tax return significantly impacts the timeline. Let's check deeper into the factors that contribute to refund delays and how e-filing stands out compared to paper returns. 

A detailed look at IRS refund stages 

The IRS refund process can seem like a black box, but fear not! Here's a breakdown of the key stages your return goes through, along with factors that can influence the processing timeline. 

Stage 1: Return received 

This is the initial step, where the IRS acknowledges they've received your tax return. Here's what happens: 

• E-filed vs. paper returns: Electronically filed returns are typically uploaded to the IRS system within 24 hours. Paper returns take longer, as they need to be physically scanned and entered into the system. 
• Confirmation: You might receive an electronic or paper notification confirming the IRS has received your return. 

Stage 2: Return reviewed 

Here's where the real work begins! The IRS meticulously reviews your return to ensure accuracy and prevent fraud. This stage can involve several checks: 

• Verification: Income amounts are verified by employers and financial institutions. Deductions and credits claimed are also scrutinized for legitimacy. 
• Mathematical errors: The IRS checks for any calculation mistakes that could affect your tax liability or refund amount. 
• Scrutiny selection: In some cases, returns are chosen for a more in-depth examination known as scrutiny. This can happen if there are inconsistencies, complex tax situations, or red flags identified during initial processing. While not necessarily a bad thing, scrutiny can add weeks or even months to the processing time. 

Stage 3: Refund approved/sent 

Congratulations! If your return passes all the checks and verifications, you're in the final stretch. Here's what to expect: 

• Refund approved: The IRS finalizes your refund amount and confirms it's ready to be sent. You might receive a notification informing you of the approval and estimated deposit date. 
• Refund delivery: The IRS doesn't physically deliver refunds. They are electronically deposited into your bank account (if you chose direct deposit) or mailed out as a paper check. 

Your refund tracking toolkit 

Ever filed your tax return and then impatiently awaited your refund? Wondering where it is and when it might arrive? Fear not, the IRS has a helpful tool called "Where's My Refund?" that can shed light on the whereabouts of your tax return and estimated refund date. 

What you'll need to use the tool ?

To utilize "Where's My Refund?" effectively, you'll need to gather a few key pieces of information: 

• Social security number (SSN) or individual taxpayer identification number (ITIN): This is the unique identifier used by the IRS to track your tax return. 
• Filing status: Are you filing Single, Married Filing Jointly, Married Filing Separately, Head of Household, or Qualifying Widow(er)? 
• Exact refund amount: Double-check your tax return to ensure you have the precise refund amount in whole dollars (no cents). 

Using the "Where's My Refund?" tool

The process is simple and straightforward: 

1. Head to the IRS website: https://www.irs.gov/refunds 

2. Locate the "Tools" section and click on "Where's My Refund?" 

3. Enter your Social Security number (SSN) or Individual Taxpayer Identification Number (ITIN). 

4. Select your filing status from the dropdown menu. 

5. Input the exact refund amount you expect to receive in whole dollors. 

6. Click "Submit" and voila! 

The tool will display the current status of your tax return. Here are some possible messages you might see: 

• Return received: The IRS has received your return and is processing it. 
• Refund approved: Great news! Your refund has been approved and is scheduled to be sent out by a specific date. 
• Refund sent: Your refund has been issued! The timeframe for receiving it will depend on whether you chose direct deposit or paper check. 

Important tips

• The IRS updates "Where's My Refund?" once a day, typically overnight. Checking more frequently won't expedite the process. 
• You can access "Where's My Refund?" anytime on a computer, smartphone, or tablet. 

By using "Where's My Refund?" and having the necessary information readily available, you can demystify the refund process and gain peace of mind knowing where your tax return stands. 

Check out the blog - What Impact Does the New U.S. International Tax System Have? 

Track your refund on the go with IRS2Go app 

The IRS2Go app is your handy mobile companion, letting you track your refund status from anywhere, anytime. 

Features at your fingertips

• Refund tracker: You can check the current status of your tax return and estimated refund date with just a few taps. 
• Tax tips: Get bite-sized, easy-to-understand tax tips throughout the year, helping you stay informed and avoid future filing headaches. 
• Payment options: Need to make a tax payment? The app allows you to securely submit payments directly from your device. 
• News and updates: Stay informed about the latest tax news and important announcements from the IRS. 

Downloading IRS2Go

IRS2Go is super easy to start using. Just a few simple steps and you're all set! 

1. Open the app store on your smartphone or tablet (Apple App Store, Google Play Store, or Amazon Appstore). 

2. Search for "IRS2Go." 

3. Download and install the app on your device.

Federal tax refund vs. state tax refund  

Tax season can be confusing, and with both federal and state income taxes to consider, it's natural to wonder about the differences between your federal and state tax refunds. Here's a breakdown to help you understand them better: 

The source of authority 

• Federal tax refund: Issued by the Internal Revenue Service (IRS) based on your federal income tax return. Federal income tax is a tax levied by the U.S. government on your taxable income. 
• State tax refund: Issued by your individual state's tax agency based on your state income tax return. Many states have their own income tax systems, with varying tax rates and brackets. 

How you file? 

• Federal tax refund: You can file a separate federal tax return or combine it with your state tax return, depending on your state's regulations. 

• State tax refund: You typically file a separate state tax return, although some states may allow you to file it electronically along with your federal return. 

Processing time

• Federal tax refund: The processing timeframe for federal tax refunds can vary depending on whether you file electronically or on paper, and if you choose direct deposit or a paper check. Generally, e-filed returns with direct deposit are processed the quickest (within a few weeks). 
• State tax refund: The processing time for state tax refunds can also vary depending on the state and your filing method. It's usually slower than federal refunds, sometimes taking several weeks or even months. 

Who gets what ?

• Federal tax refund: You may receive a federal tax refund if you overpaid your federal income taxes throughout the year. This can happen due to factors like withholding too much from your paycheck or claiming tax credits. 
• State tax refund: Similar to the federal level, you may receive a state tax refund if you overpaid your state income taxes. 

Maximizing your tax refund 

Do you have a plan for your tax refund this year? Getting a tax refund can be a great chance to make progress toward your financial goals. Let's discuss some smart ways to use your tax return to improve your financial situation. 

• Pay off debt: If you're working on reducing debt, using your tax refund to make an extra payment can accelerate your progress. Consider targeting high-interest debts like credit card balances. 
• Build an emergency fund: An emergency fund provides a safety net for unexpected expenses or income loss. If you don't have one yet – experts suggest having three to six months' worth of living expenses saved – your tax refund could kickstart your savings. 
• Increase retirement savings: While it may seem early to save for retirement, even a small boost today can grow significantly over time. For example, adding just $1,000 to your retirement account now could be worth over $17,000 in 30 years. 
• Save for a home down payment: Saving for a home can take several years for many aspiring buyers. Allocating your tax refund toward your future down payment could expedite reaching that goal, potentially cutting months or even years off the timeline. 
• Treat yourself: While it's important to prioritize financial goals, it's also essential to enjoy life along the way. Allocate a portion of your tax refund for something enjoyable and frivolous. This can help maintain motivation and prevent burnout from solely focusing on long-term objectives. 

Bottom line 

While the IRS system is a helpful tool for checking your basic tax refund status, it may not be enough for everyone. For those with more complex tax situations or lingering questions, BookkeeperLive can offer a comprehensive solution. Their expert tax preparation service goes beyond simply checking the IRS website. They can ensure your return is filed accurately in the first place, minimizing the risk of errors that could delay your refund.  

Furthermore, BookkeeperLive's tax professionals can help you understand your tax liability and develop strategies to optimize your return. This can involve uncovering deductions you may have missed and ensuring you claim all the credits you're entitled to. Ultimately, BookkeeperLive can help you maximize your refund and minimize your tax obligations, leaving you with peace of mind and potentially more money in your pocket. 

FAQs 

1. What if I made a mistake on my tax return? Can I amend it? 

Yes, you can amend your return using Form 1040X. However, amending may delay your refund, so it's best to try to file accurately the first time. 

2. What if the IRS says my refund has been deposited but I haven't received it? 

First, double-check your bank account to ensure it wasn't deposited into a different account. If you're still having trouble, allow an additional 5 business days for the deposit to reflect in your account. After that, you can contact the IRS for further assistance. 

3. I filed jointly with my spouse. Can we both track the refund status? 

Yes! Both you and your spouse can track the refund status using the IRS "Where's My Refund?" tool. You'll each need to enter your own Social Security number, filing status (Married Filing Jointly), and the exact refund amount from the joint tax return. 

4. My refund status says "processing." What does that mean? 

"Processing" means the IRS is still reviewing your return. This is the most common status, but it doesn't give a specific timeframe for receiving your refund.