Tax Refunds Delayed Due to Historic Tax Fraud
This year, tax refunds for those claiming an Earned Income Tax Credit or Additional Child Tax Credit have been delayed until after the end of February. The delay in refunds caused several reasons for speculation, however the IRS is reporting it is due to increased measures taken to prevent tax fraud. Fortune magazine states,
“The IRS estimates it issued $3.1 billion in tax refunds to identity thieves in 2014 and $5.8 billion the year before…”
That is just for the earned income credit. Fortune also stated,
“The Additional Child Tax Credit assists families who do not owe enough in federal taxes to claim the entire $1000 they are entitled to. In 2014, about 20 million families claimed the credit, which created $27 billion in extra refunds.”
Hopefully, by taking the time to properly review the tax refunds, these billions upon billions of dollars will not be incorrectly allocated, as they have been in the past.
Unfortunately, the refund delay is expected to hit the low-income families the hardest. Many individuals rely heavily on their refunds to meet ends meat. By delaying the refunds, this could impact these families the hardest.
Doing Your Part
The government continues to make strides towards avoiding incorrectly allocating tax refund dollars to fraudsters. But you must also do your part. Unfortunately, now is the time scammers may be calling or emailing you regarding obtaining a refund, or even the opposite — that you owe the IRS money. Many of these scammers will request you bank account information to “deposit” this money. Or request a payment. It is important you know the following things about the IRS refund policy:
- Most importantly, the IRS will not call or email you. If you truly owe the IRS anything — they will send you a letter in the mail.
- To check whether or not you owe the IRS, you can go to their website by clicking here.
- If you want to check the status of your return, do so by going to the IRS website directly by clicking here.
- If you receive an email from anyone claiming to be from the IRS, report it to email@example.com.
- If anyone attempts to call you stating they’re from the IRS, you can report it to the Treasury Inspector General for Tax Administration at 800-366-4484.
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