IRS: Income Tax Refunds Delayed 7 Weeks or More

A last-minute tax law passed by Congress means that as many as 13 million Americans tax refunds could be delayed by seven weeks or more. Dont let government delays keep you from the money you need apply today for a safe and secure cash advance from CashNetUSA and get up to $750 deposited directly into your checking account, next day.

Why are tax refunds being delayed? On December 20, 2007, the US Congress passed a last-minute change to the tax code regarding the controversial Alternative Minimum Tax (AMT). Since tax software and paper forms were already created for the 2007 tax season, the Internal Revenue Service (IRS) has announced that it may take up to seven weeks to implement these changes. This means that the tax filing season, which normally begins on January 13th, would not begin before February 11th at the earliest. This delay in filing dates will result in taxpayer refunds being delayed by nearly two months. Its important to understand that although you not may be required to pay the actual AMT fee, your income tax refund may still be affected.

What is the AMT? The AMT is a specific part of the tax code, passed in 1969, which was designed to properly tax only a select few of wealthy Americans. However, the law did not account for inflation and over the years has steadily begun to include middle-class taxpayers who were not the original targets of the bill. In 1970, only 155 of the wealthiest Americans were affected. Without an emergency amendment in 2007, almost 25 MILLION Americans would have had to pay the tax.

Will my refund be affected? Due to the lateness of the legislation, the IRS oversight board has estimated that almost $40 billion in tax refunds will be delayed, accounting for more than 11% of the 140 million American taxpayers. Since the change affects several IRS tax forms and software, even those who do not qualify to pay the AMT will be affected. Those taxpayers who are required to fill out any of the following five forms will be those who are primarily affected:

• Schedule 2 (Form 1040A) Child and Dependent Care Expenses for Form 1040A filers
• Form 8863 Education Credits
• Form 5695 Residential Energy Credits
• Form 8396 Mortgage Interest Credit
• Form 8859 District of Columbia First-Time Homebuyer Credit

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When will I be able to file my taxes? The IRS has requested an additional seven weeks after the enactment of the bill to make the necessary changes to their software and forms. Taxpayers would be able to file taxes starting February 18th, 2008 over a month later than usual.

I file my taxes electronically. Will I be affected? Yes. The law will affect IRS software as well as paper forms, meaning even electronic returns may be subjected to refund delays.

For more information, please click here and visit the IRS website.