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Questioning a tax refund

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Occasionally, your money back from Uncle Sam isn't exactly what you were expecting. So what if your tax refund is wrong? I'm Doug Whiteman with your Bankrate.com Personal Finance Minute.

First, don't panic. There's usually a logical explanation for why you and the IRS came up with different numbers. The reason might be a math error, incorrect credit or deduction claims, or estimated tax payments not credited properly. Maybe other federal debts, such as a student loan, were collected out of your refund.

If the refund is less than you expected and it turns out that you were correct, once you and the IRS resolve the matter in your favor, the agency will make up the difference (plus a bit of interest if it takes more than 45 days to correct the error). You'll be issued payment for the balance due.

If, however, your refund is much more than you believe you should have received, it's generally a good idea to hold off cashing the check or spending the money until the issue is resolved. Thomson Reuters senior tax analyst Bob Scharin says you could be asked to send back any overage, and that's easier to do if you still have the money in hand.

For more about tax refund discrepancies, visit Bankrate.com. I'm Doug Whiteman.

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