With tax season 2025 in full swing, many taxpayers are eagerly anticipating their refunds. Tax refunds occur when you pay the IRS more than you owe throughout the year.
This is common for freelancers and self-employed individuals who estimate their tax payments. Typically, refunds are processed within 10 days of filing. However, not everyone will receive a tax refund this year.
Tax Refund
The Treasury Offset Program is responsible for collecting unpaid debts owed to federal and state agencies. In 2024 alone, this program recovered 3.8 billion dollars in delinquent debt, largely from tax refunds. The IRS has stated that refunds may be reduced or withheld if you owe certain past-due amounts.
Common Reasons
You may not receive a refund if you owe money for:
State income taxes
Federal student loans
Unpaid child support
If your refund is larger than your outstanding debt, you may receive the remaining balance. If your debts exceed the refund amount you are entitled to, your tax refund will be completely offset.
Tax Deadline
The income tax filing for 2024 is due April 15, 2025. In certain cases, you can ask for an extension; however, this does not apply to extending the deadline for tax payments on any taxes owed.
Refund
If no taxes or debts are owed, expect your refund around 10 business days after filing; but, there are cases where taxpayers can expect some delays in the processing of their refund-cheques for the following reasons:
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Child Tax Credit (CTC)
Earned Income Tax Credit (EITC)
Because of hardened verification requirements, the processing of these will generally take slightly longer.
Refund Status
The IRS “Where’s My Refund” tool allows taxpayers to track their refund status within 24 hours of filing electronically. However, if you file your taxes by mail, you may need to wait up to four weeks before checking your status.
IRS Contacts You
So, if an IRS letter drops in your mailbox, open it. Other than that, it could be about some significant status of your refund, tax obligation, or refer to the need for some verification.
Dealing with IRS Notices
Read the notice and follow instructions.
Keep the notices from the IRS for a period of at least three years.
Be alert concerning scam calls as the IRS does not contact taxpayers through unsolicited phone calls or social media.
If you are doubtful, contact the IRS directly for guidance.
Final Remarks
Tax filing can be harrowing, especially as you wait for a refund to roll in. Your refund may be offset or intercepted if you have federal or state debts owed. Be proactive when checking your refund status with one of the IRS’s tools, and stay on the lookout for tax scams. And if the IRS sends a letter your way? Respond quickly or suffer the consequences in a delayed tax return.
FAQs
1. Why is the IRS withholding tax refunds from certain groups this year?
The IRS is not issuing refunds to certain taxpayers due to eligibility issues, outstanding debts, or fraudulent activity concerns. These measures help prevent fraud and ensure compliance with tax laws.
2. What happens if my refund is withheld due to suspected fraud?
If your refund is held due to suspected fraud or identity theft, you may need to verify your identity through an IRS request or submit additional documentation before it is released.
3. How do I check if my refund is being withheld?
You can check your refund status through the IRS “Where’s My Refund?” tool on IRS.gov or by calling the IRS directly.
4. What should I do if my refund is delayed or denied?
If your refund is being withheld, the IRS will send you a notice explaining the reason. You may need to provide additional documentation or resolve outstanding debts to receive your refund.
5. Can I still receive a partial refund if I owe the IRS money?
If you owe taxes or other debts, the IRS may offset part or all of your refund to cover what you owe. You will be notified if an offset occurs.