What does that mean for taxpayers? Expect to wait in line.
How long might you have to wait if your 2019 return is outstanding? In some case, the IRS says it’s still processing tax returns from July 15, 2020—the extended deadline for 2019 returns. If there’s a mistake, missing information or suspected fraud, the IRS may need more information and will contact you by letter. Reply promptly!
For 2020 tax returns, the latest IRS 2021 filing season statistics show that as of March 12, the IRS has received 66 million tax returns, with 58.5 million processed so far. The IRS has issued 42.5 million 2020 tax year refunds (that’s down 28% from this time last year, partly because the filing season started late this year), at an average of $2,967 a piece.
For 2020 returns, if you e-filed and are due a refund, you can still expect to get it by direct deposit within 21 days, the IRS says. But the same catch applies if there’s missing information: Wait for a letter, and respond promptly.
How can you check on the status of a refund? If you haven’t filed your 2020 tax return yet, you can get information on the IRS Where’s My Refund tool about your 2019 refund status: If you filed your 2019 return before July 1, the 2019 information would have been removed in December, but if you filed before then, the 2019 information will still be available, according to an IRS spokesperson.
Once you file your 2020 return, the Where’s My Refund? tool will show information about that return. The IRS has more details on its updated FAQ page about tax refunds.
Another option: If you set up an IRS online account, you can look up amounts of your total stimulus payments received, get information from your most recent tax return, view payment history, and get digital copies of some notices the IRS sent you. To check the status of Round 3 $1,400 stimulus payments, check out the IRS Get My Payment tool.
While you’re thinking about 2020 taxes, if you need to make quarterly estimated payments—that includes most gig workers and many retirees—the first one for the 2021 tax year is due April 15! That’s despite the fact that the IRS postponed the tax day deadline to file and pay 2020 taxes until May 17, 2021 (note: the extension is for individuals, not for trusts or gift/estate tax returns).
And don’t get used to the extended tax day deadline. “This cannot be a pattern,” IRS Commissioner Charles Rettig said in a House hearing yesterday. “We’re just trying to give individuals a little breathing room.”