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July 26, 2021
Question

Delay in return processing

  • July 26, 2021
  • 1 reply
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My efile return was accepted by Fed and State back in April....refund is due but has not been deposited.  Checking with IRS says status is "Processing."  Still.  Note: I sold a home and changed address in 2020. Despite address change, Turbotax recommended using standard deduction short form. Could the hangup be the address change tells IRS I should have reported details on the home sale transaction somewhere? 

    1 reply

    DoninGA
    Employee
    July 26, 2021

    There are no short forms for the 2020 tax return, there is only the Form 1040.  The standard deduction will be used on your federal tax return if the amount of your itemized deductions is less than standard deduction for your filing status.

     

    If you sold your primary personal residence and you lived in and owned the home for at least two years in the five year period on the date of sale, you do not have to report the sale if your gains are less then the exclusion amounts of $250,000 if filing Single or $500,000 if filing Married Filing Jointly (and both lived in the home for two years).

    If you had a gain greater then the exclusion amounts then you would have to report the sale. Also, if you received a Form 1099-S for the sale either with a gain or a loss, the sale has to be reported.

     

    Did you receive a Form 1099-S for the sale of the home?

     

    The IRS is seriously behind in processing 2020 tax returns.  This is due to many factors, such as the pandemic, completing processing of millions of 2019 tax returns, stimulus payments, unemployment compensation exclusion tax refunds., changes in the tax code by Congress in the middle of the 2020 tax season and the like.

     

    Millions of taxpayers have not yet received there federal tax refunds.

     

    Go to this IRS website for operational status - https://www.irs.gov/newsroom/irs-operations-during-covid-19-mission-critical-functions-continue

     

    As of July 17, 2021, we had 15.6 million unprocessed individual returns. Unprocessed individual returns include tax year 2020 returns such as those requiring correction to the Recovery Rebate Credit amount or validation of 2019 income used to figure the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC). This work does not require us to correspond with taxpayers but does require special handling by an IRS employee so, in these instances, it is taking the IRS more than 21 days to issue any related refund and in some cases this work could take 90 to 120 days. If, as a result, a correction is made to any RRC, EITC or ACTC claimed on the return, the IRS will send taxpayers an explanation. Taxpayers are encouraged to continue to check Where’s My Refund? for their personalized refund status and can review Tax Season Refund Frequently Asked Questions.

     

    What you should do: In most instances, no further action is needed but you may check Where’s my refund or you can view your account. If you filed electronically and received an acknowledgement, you do not need to take any further action other than promptly responding to any requests for information. If you filed on paper, check Where’s my refund? If it tells you we have received your return or are processing or reviewing it, we are processing your return, but it may be under review. We’re working hard to get through the backlog. Please don’t file a second tax return or contact the IRS about the status of your return.