The Protecting Americans from Tax Hikes (PATH) Act, signed into law in December 2015, requires the IRS to hold tax refunds that include Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC) until February 15, 2017.
The new tax law, which applies to all tax preparation methods, is intended to help detect and prevent tax fraud. The extended refund release also gives the IRS more time to ensure taxpayers are properly claiming the credits, so they get the refund they are owed.
The IRS will begin accepting and processing tax returns in mid to late January. Tax refunds for those who claim Earned Income Tax Credit or Additional Child Tax Credit will begin to be issued on February 15, 2017, so there’s no need to wait! The sooner you e-file your return, the sooner you’ll get your tax refund.
Most taxpayers will not be impacted by the change in the law and the IRS expects the majority of tax refunds (more than 9 out of 10) will be issued in 21 days or less from acceptance. Last year, close to 75% of all taxpayers received a federal tax refund of about $2,700. Eight out of 10 taxpayers receiving tax refunds choose direct deposit, and e-file with direct deposit is still the fastest way to get your tax refund. If you have questions about the processing of your tax return, the IRS “Where’s My Refund?” site is the best place to get personalized refund information when you need it.
When you are ready to do your taxes, you can be confident that TurboTax has you covered. It’s up to date with latest tax laws, asks you simple questions, and searches for tax deductions and credits you may be eligible for based on your answers. For more information on the PATH Act and other tax laws check back here with the TurboTax blog.