Thursday, January 26, 2012

IRS Issues Could Delay Tax Refunds

It's news you don't want to hear.   It could take longer to get your tax refund this year.
Turbo Tax and H&R Block said problems at the IRS are causing big delays.
The IRS started its e-file system two days late. Usually it starts on Jan. 15th, this year it was Jan 17th.
Now for those people who have filed, they're going to this site( to check the status of their refund and getting an error message.
That's because of an unplanned outage of the IRS e-file system.
Companies like H&R Block and Turbo Tax are letting customers know via Facebook and in-person about the e-file issues.
H&R Block's Central Coast district manager in Watsonville told Central Coast News Wednesday, he sees quite a few people filing their taxes early, especially families.
The delay is putting refund's behind schedule.  For example, if you filed your taxes on Jan. 17th, you should expect to see a refund Feb. 1st, a week later than normal.
"We try to explain before they start doing their taxes.  We give expectations and we try to explain what the IRS is doing this year, so that when we do the return they aren't shocked or surprised," said Fernando Paco.
Even when the IRS fixes the problems in e-filing, you could still be waiting longer to get your refund, that's because funding to the agency has been reduced the past two years.
Right now, the IRS said it is unable to answer three out of ten calls from taxpayers.
There is some good news.  Changes to the tax codes could get you some more money when you do file.
First, for every dependent you claim the credit is increasing from $99 to $315.
Next, you can continue to put money into an IRA all the way through April 17th of this year, and that will be included in your 2011 tax return.  The deadline used to be December 31st.
Finally, there are new stimulus fund credits good for one or two years. This year those include people who attend community college and trade schools. In the past, credits included first-time home buyers and energy efficient home improvements.