Were Holding Your Refund Until We Finish Reviewing Your Tax Return
What Does It Mean if My IRS Tax Refund Is Under Review
By
Allison Martin
Allison holds a Master of Accountancy (MAcc) degree and has experience in auditing, taxation, governmental accounting, and research assistants. She also teaches money management and personal finance courses.
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Master of Accountancy
Have you been anxiously awaiting your refund merely to detect out information technology is being delayed by the IRS? Don't fret. Here's what this means and what to do about information technology.
Why Information technology Is Under Review
When the IRS officially places your return under review, y'all will receive a CP05 notice, and the processing of your refund will be delayed until the review is complete. According to the IRS website, a number of distinct factors can trigger the review, including the need to verify the post-obit entries on your return:
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Income is not overstated or understated.
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Tax withholding amounts are right.
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You take the right to claim the tax credits on your return.
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Social Security benefits withholding amounts are correct.
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Household help is accurately reported.
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Schedule C income is not overstated or understated.
To ostend the accuracy of the contents, the IRS may contact third parties.
Review Triggers
There is no hard and fast way to determine why your return was selected for a review. Co-ordinate to IRS.gov, "returns [are selected] for examination using various methods which include random sampling, computerized screening, and comparison of information received by the IRS such as Forms Due west-2 and 1099." If your return is selected for a review, it doesn't necessarily bespeak or advise you made a mistake or deliberately misreported your informaiton.
Upon receiving the CP05 find, the IRS recommends yous take the follow steps if you have additional questions or concerns:
- Consult with your taxation preparer to gain a meliorate understanding of the notice.
- Call the toll-free number listed at the top of the notice to receive additional information.
- Call the Taxpayer Advocate Service (TAS) hotline at 1-877-777-4778 if you believe your return has been selected in mistake due to the inadequate screening of IRS systems.
- Authorize a professional tax preparer or auditor to communicate with the IRS on your behalf by submitting Form 2848 (Power of Chaser and Declaration of Representative).
How to Avoid Reviews
To peradventure subtract your chances of beingness reviewed, be sure to report all information in the most truthful fashion possible. Besides, be mindful of common inspect triggers.
When the Review Is Consummate
Once the review is complete, the IRS will make the necessary adjustments and issue your refund accordingly.
Fourth dimension Frame
The IRS encourages taxpayers to wait at least 45 days from the 24-hour interval y'all receive the CP05 find to follow upwards nearly the status if you oasis't yet received your refund. Use the number found on the notice to ensure you are routed to the correct department.
IRS Audits
Your return could likewise be selected for a taxation audit. If the accountant that initially reviews your return thinks it is necessary to conduct a more thorough examination, it will be forwarded to an examining group and reviewed by a manager to determine if information technology is best to motility forward with a total-fledged audit or accept the return equally is. Taxation audits are either performed via post or in-person. See the IRS Inspect FAQs for boosted data.
If You're Flagged for Review
If your return is flagged for review, remain calm. Cooperate with the IRS (if they request boosted documentation) to ensure your return is processed in the most seamless and rapid manner possible.
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Source: https://taxes.lovetoknow.com/federal-income-tax/what-does-it-mean-if-my-irs-tax-refund-is-under-review
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