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How long does IRS have to pay a refund on an amended return? I have contacted the National Tax Payers Advocate and received different answers. The problem is that it has been five months now since I filed an amended return for a refund and we have had no communication from the IRS. It just sits in examination for review since April, 22, 2008 with no activity or release for payment. How much time do they have before they have to make a payment?
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In general, a taxpayer may file a claim for refund within three years from the time the refund was filed, or within two years from the time the tax was paid, whichever is later. If you filed your 2007 tax return by April 15, 2008 you have until April, 15 2011 to file an amended return for tax year 2007.
Generally, if you file a return through the mail, you can typically expect your refund to be sent within 6 to 8 weeks of your return being received. However, that general time frame applies to returns being filed for the current tax year.
When you file an amended return, the processing period typically takes longer, but there is no deadline that the IRS must adhere to. The processing time for your return will depend on the nature of the changes that you made on your amended return as well as the backlog of IRS amended returns, and that may be part of the reason that you are experiencing what seems like a long delay. This year in particular the IRS has had an influx of amended returns being filed due to taxpayers who did not fill out their original returns correctly, and therefore did not receive their stimulus rebate. In order to qualify for the rebate, they had to file amended returns, and I am quite certain the number of amended returns filed this year have been considerably more than normal for this reason.
There is a website where you can check on the status of your refund and I am giving you a link to that below. However, if your amended return has not yet been processed, then the refund information will not yet be available. I wish there was a more definite answer for you, but I do believe the delay is most likely caused due to the increased number of amended returns which were filed this tax season.
Here are some more facts:
Our return was an amended 2005 return that went into examination on 4/22/2008 and was told because it was amended we needed to wait 12 weeks before inquiring about the status of our refund. I contacted their office at the end of the 12 weeks and was told that it was still there but no activity has occurred. No communication with us at all. The IRS help line said they would put in a request for a resolution and I was told they had 30 days to release the return for funding or communicate with us regarding questions about return or etc. and I was to contact them again after 30 days.
The IRS person told me they had the 30 days and if they did nothing then it would come out automatically and our refund would be processed. At the end of the 30 days I again contacted the IRS and they said there was still no activity and we had received no communication from the service regarding this return. The IRS person said that the examination department missed the statutory time period for communicating with us and therefore had to release for processing for our refund. They then referred me to the national taxpayer advocate for resolution and said that NTA could get our refund done in 2 weeks and I was told to contact them in 7 days. On the 8th day I called and they gave me a local representative here in Dallas who I contacted and they once again have put a request in to the examination department to release the return and then the local rep tells me I have to wait another 30 days.
As you can see we just keep going in circles. The question is really is there any statutory language that requires them to either actively work the file, communicating with the taxpayer and if there is none of that. How long can the examination department sit on a return and thereby prevent the refund without any activity or effort on their part. For all I know, it is sitting on some agent’s desk for review and will remain at the bottom of his pile forever.
When you send an amended return to be process, the IRS rules state that they have 12 weeks to process the return. The time start when the IRS receive and enter the return in their system, not when you mailed the return. If the return is not process by the 12th week the taxpayer can request the Taxpayer Advocate Service to process the return. If you want the TAS to process the return, it would add another 4 to 6 weeks before the return is process. There is no statutory language that requires the IRS to process the return in a set time or time limit.
My advice to you is to have the Taxpayer Advocate Service process your amended tax return. The TAS will give you a person you can contact directly to find out the statue of the return. Also, you will know your return is being process. You will also receive interest on your refund from 2005 to 2008.
I can certainly understand your frustration at this point in time with the run around that it appears you have been getting on the status of your amended return.
I am not personally aware of any time limit or time restraints that the IRS has on processing a return, although it may be an internal policy within the agency that some form of communication must go out at least every 30 days. But I am going to check with one of the other tax experts in this forum who is also on the tax advocacy panel, and see if he is aware of any such statute. As soon as I hear back from him, I will let you know.
I have been asked to take a look at this question.
The IRS has an internal procedure that they have returns processed within certain time limits. This is part of the Quality assurance they use to monitor customer service.
Legislatively, they are under a mandated 10 year effort starting in 2001 to convert all processing to electronic returns, and to reduce processing times of paper returns to 40 days. BUT there is no regulatory guidance to legally, force them into a system of processing a claim such as yours or communicating back to you.
REFERENCE for the 40 day guidance:
TITLE 26 - INTERNAL REVENUE CODE Subtitle F - Procedure and Administration CHAPTER 61 - INFORMATION AND RETURNS Subchapter A - Returns and Records PART II - TAX RETURNS OR STATEMENTS Subpart A - General Requirements
Here is a link to the overview of the Tax resolution quality issues. Again these are not legislative but are derived based on authority of IRC § 7803(c),
From the IRS Manual: http://www.irs.gov/irm/part13/ch01s07.html
If you would like to address this issue with the IRS you may make a comment on the following website:
You may find free tax payer legal assistance from the IRS legal aid. You can check your eligibility and the location of the nearest LITC.
Your issues, if you are qualified by income group, can be resolved with legal assistance using the LITC program.