Manuel DaRosa, CPA
Accounting and Tax firm with offices in Taunton, Falmouth and Mansfield, MA
NEWSLETTERS

Where’s My Refund?

IRS seeks upgrade to dreaded online tool, but don’t hold your breath

In the midst of a particularly horrific tax season, with the beleaguered Internal Revenue Service (IRS) swamped by backlogged returns and citizens waiting anxiously for missing refunds to appear, many taxpayers seeking clarity have been referred to the dreaded online “Where’s My Refund” tracker. In other words, the place where inquiries go to die.

The “Where’s My Refund” tool, which lives on the IRS website, has been of scant help to many visitors, informing taxpayers with late refunds only that their returns are “pending.” It does not offer any estimate of when refunds can be expected, nor does it advise if additional supporting documents are needed. The lack of such basic services was flagged by the Taxpayer Advocate Service (TAS)—the arm of the IRS that ensures fair treatment of citizen taxpayers—which recommended that the IRS supply these features as quickly as possible.

And according to a TAS report, the IRS seems to have taken the first steps. It has submitted several “Unified Work Requests” to its engineers, requesting programming upgrades to the tool that would include more specific reasons for why a refund has been delayed, or a notice if it’s still reviewing whether supporting documents are needed. It also says it’s exploring a system by which taxpayers can digitally transmit documents to the IRS, such as uploading through the IRS.gov website. That could include a permanent extension of the interim rules, allowing people to submit identity verification files over eFax during the COVID-19 pandemic.

But it’s not a done deal by any means: The IRS cautions that such programming upgrades are “subject to funding limitations and competing priorities,” meaning all this could very well amount to nothing if cash is thin or other issues are deemed more important. It’s also worth noting that another request—to supply relevant contact telephone numbers through the “Where’s My Refund” tool—has already been denied “due to funding limitations.” So if you’re still waiting for your 2020 refund, maybe don’t hold your breath.

Further along in the report, the IRS also notes it would not be able to expedite legitimate refunds by modernizing its “obsolete” systems—also “due to funding limitations”—nor would it be sharing data about how long it detains legitimate refunds that are tagged by fraud filters.

Tax Alerts
Tax Briefing(s)

The agency's overall backlog is growing and its processing time is slowing.


Internal Revenue Service Commissioner Daniel Werfel is looking to build on the successes the agency has experienced with the first year of supplemental funding provided to the agency by the Inflation Reduction Act.


The Financial Crimes Enforcement Network is seeing a "concerning" increase in state and federal payroll tax evasion and workers’ compensation fraud in the U.S. residential and commercial real estate construction industries.


NATIONAL HARBOR, Md.—National Taxpayer Advocate Erin Collins is hoping that collections notices from the Internal Revenue Service will resume in the coming months.


Taxpayers, by the 2024 filing season, will be able to digitally submit all correspondence, non-tax forms, and notice responses electronically to the Internal Revenue Service, the agency announced.

Additionally,"by Filing Season 2025, the IRS is committing to digitally process 100 percent of tax and information returns that are submitted by paper, as well as half of all paper correspondence, non-tax forms, and notice responses,"Department of the Treasury Secretary Janet Yellen said August 2, 2023. "It will also digitalize historical documents that are currently in storage at the IRS."


An IRS Notice provides a transition rule that generally allows taxpayers to claim the Code Sec. 25C energy efficient home improvement credit for home energy audits conducted in 2023 even if the auditor is not certified. The Notice also describes regulations the IRS intends to propose for qualified home energy audits.


The Internal Revenue Service will end, except in very limited circumstances, the practice of making unannounced visits to taxpayers’ homes and businesses."This change is effective immediately,"IRS Commissioner Daniel Werfel said during a July 24, 2023, teleconference with reporters. Werfel said the change is being made in reaction to an increase in scam activity as well as for IRS employee safety."With a growth in scam artists, taxpayers are increasingly uncertain who was knocking on their doors," Werfel said. "For IRS employees, there were fears about their own personal safety on these visits. I also learned that these concerns were shared by our partners as the National Treasury Employees Union."


The IRS has released a revenue ruling providing additional guidance concerning receipt of cryptocurrency. If a cash-method taxpayer stakes cryptocurrency native to a proof-of-stake blockchain and receives additional units of cryptocurrency as rewards when validation occurs, the fair market value of the validation rewards received is included in the taxpayer's gross income in the tax year in which the taxpayer gains dominion and control over the validation rewards. The same is true if a taxpayer stakes cryptocurrency native to a proof-of-stake blockchain through a cryptocurrency exchange and receives additional units of cryptocurrency as rewards as a result of the validation


Problems with the Internal Revenue Service’s handling of the Employee Retention Tax Credit took center stage before a House committee hearing, with tax professionals airing issues they have experienced and ongoing concerns they have.


The IRS announced substantial progress in the ongoing effort related to the dubious Employee Retention Credit (ERCclaims. The IRS successfully cleared the backlog of valid ERCs. The period of eligibility for the credit for affected businesses is very limited, covering only between March 13, 2020, and December. 31, 2021. Under the current law, businesses can typically continue to file claims for the credit until April 15, 2025.


The Internal Revenue Service is looking for ways get its post-filing alternative dispute resolution programs greater exposure and use.

The agency recently issued a public call for comment on a variety of topics related to the use of ADR, including learning why taxpayers choose not to use ADR; issues that keep taxpayers from using ADR that should be changed to allow for inclusion; how best to improve ADR; how best to education about ADR; feedback on when ADR proved particularly useful; and ideas on how to achieve tax certainty or resolution sooner beyond existing ADR programs, including ideas for new programs.


National Taxpayer Advocate Erin Collins is reiterating her call for the Internal Revenue Service to stop automatically assessing penalties related to international information returns.


HOME-DaRosa Tax ServiceFIRM PROFILECLIENT SERVICESINFORMATION CENTERINDUSTRIESNEWSLETTERSFINANCIAL TOOLSLINKSCONTACT US ANYTIMEMANNY'S WEEKLY NEWS CORNER