Dear Tax Talk,
I filed my tax return on Jan. 26, 2012, and it was accepted the same day electronically. I was supposed to get a tax refund due on Feb. 14, according to the Internal Revenue Service’s “Where’s My Refund?” status site. As the date got closer to Feb. 14, it changed to “If you file a complete and accurate tax return, your refund will be issued within six weeks of the received date.”

I have been calling the IRS numerous times. I get different answers. The first person said that she sees nothing wrong on my tax forms and to wait until April 1, that my tax refund probably got caught in that computer glitch. The second IRS agent wasn’t really sure what was going on and said she was going to call me back, which never happened. The third IRS agent stated that I need to send my original tax forms to an IRS office in Fresno, California (which I did send, and they received it on April 10), and it was going to take six to eight weeks to be processed from the time it was received.

This is outrageous! It’s been more than 12 weeks since it got accepted. My question is: Should the IRS pay me interest for delaying my tax refund? Thanks!
— Jay

Dear Jay,
It does seem like a lot of runaround for something that should be so simple. However, you’re dealing with bureaucracy at its biggest. The IRS began tweaking computer systems this year to tamp down some tax refund fraud. If you moved, changed status or had jumps in your refund amount, you probably noticed your refund was delayed.

In 2011, the IRS estimated about 350,000 fraudulent returns had been detected claiming about $1.9 billion in refunds. In 2012, the Government Accountability Office estimates that fraud will cost the government $26 billion in refunds in the next five years.

To answer your question, yes, the IRS owes interest to taxpayers on delayed refunds. However, the date for computing interest begins 45 days after the later of:

  • The unextended due date.
  • The date filed.

Since April 17, 2012, is the unextended due date for 2011 tax returns and that is the later date between the date filed and the due date, the IRS won’t owe interest until 45 days after April 17. Unfortunately, there is no prize for filing early. However, you’d only be getting a 3 percent per annum interest on your tax refund anyhow so no big loss.

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