Income Tax Return Refund
What is a tax refund? An income tax return refund is the result of too much tax withholding - or estimated tax payments - by a taxpayer throughout a tax year. In essence, a taxpayer hands over his or her own hard earned money to the IRS or state interest free, only to get it back via a tax refund in many cases over a year later.
Are you putting a self-imposed tax refund penalty on yourself?
In the past, a taxpayer did not have many tools to be able to plan for a zero tax refund or a balanced tax return. The W-4 form or paycheck tax withholding form is set up to provide a dollar tax withholding amount per paycheck. In the past, it used to be adjusted by number of allowances, but that has since been replaced with dollar amount as it was confusing to taxpayers.
We at eFile.com have made it even simpler by developing the Taxometer tool. This free tool gives a taxpayer a comprehensive way to not only set personal tax return goals, but also taxercise a paycheck and the upcoming tax return. The Taxometer will guide a taxpayer through from paycheck to tax return to W-4.
Tax Refund Deposit Options
Important: Double, triple, and quadruple-check your direct deposit information entered when you submit your return to the IRS. Your bank information cannot be changed once the IRS has accepted your return. This means you cannot file a tax amendment or re-file your return to update or change your bank account with the IRS. The IRS is going to use your most recently filed and accepted return to issue future tax credits, such as recovery rebate credits or stimulus checks (Economic Impact Payments). If an inaccurate bank account is entered, the IRS will mail your tax refund and future stimulus payments to the address on your return.
First, plan and estimate your tax return with the eFile.com Tax Calculator before you even prepare and e-File via the eFile tax app. You will know whether you can expect a tax refund, owe taxes, or neither. Should you expect a tax refund, consider the following tax refund options below. During checkout on eFile.com, you will be presented with these tax refund transfer options.
If you don't wish to read more, simply use the eFile.com DATEucator tool to get your refund anticipation dates on when you can expect your tax refund based on the deposit options selected. The tool is free, interactive, and will provide you with the answer you are looking for. Already filed? See how to track your tax refund status.
Pro/Con Comparison of Tax Refund Deposit Methods
The table below is organized by the method of payment or deposit, a brief description of each entry, and a pro and con of the refund method. Below the table, find more detailed information regarding each method. These are all methods of receiving your tax refund you will choose during the checkout process on the eFile Tax App. If you are familiar with these methods, simply select the option that accounts for your situation best after you e-file your 2020 Tax Return with eFile.com.
e-Collect Direct Bank Deposit
Select e-Collect during checkout in the eFile.com tax app if you are expecting both an IRS and state tax refund (not available if you're only expecting a state tax refund). This method can be used if your return is not free and you don't want to pay your tax preparation fee by credit card or don't have a credit card.
Pro: Your eFile.com tax preparation fee will be deducted from your tax refund, thus you will not need a credit card.
Con: A processing fee will be charged by EPS, though it's the lowest in the industry.
IRS Direct Bank Deposit
Select this option during checkout in eFile.com app if your return(s) are free or you prefer to pay your eFile tax preparation fee by credit card. This method will get you tax refund the fastest way.
Pro: If you prefer to pay your eFile.com tax preparation fee by credit card, that is the only fee you will pay as no other fees apply to this method. It is the quickest, cheapest, and simplest method.
Con: None! Assure your bank information is accurate and there should be little delays in receiving your refund.
IRS Check in the Mail
Select this tax refund deposit method if you either don't have a bank account or for other reasons where you don't want to receive your refund directly to your bank account, such as having a foreign address on your tax return. Plus, you don't mind paying the tax preparation fees by credit card.
Pro: If your tax return preparation is not free, you can pay by credit card and no additional fees apply with this method. Your refund check will be mailed to the address listed on your IRS tax return.
Con: This will take time for the paper check to be mailed and puts your refund at risk of misplacement during transit.
File your tax return online on eFile.com now or by October 15, 2021! After this date, you will no longer be able to e-file here or anywhere. You have up to three years to claim your refund, but why wait? It's your hard-earned money. Did you know that there is no penalty for filing after the deadline if a refund is due? Most taxpayers are unaware of this; you do not have to file a tax extension if you are owed a tax refund as you will not face any penalties, according to the IRS.
Bank Deposit Options
You can have your IRS tax refund and/or state tax refund deposited directly into your bank account. If your tax return is not free on eFile.com, your tax preparation fee can be paid via credit card only or you can select the eFile.com e-Collect bank deposit option. This option will enable you to deduct any tax preparation fee from your tax refund, thus you will not need a credit card to pay for any fees. The processing bank, not eFile.com, will charge a small convenience fee for this service.
Below, find more information on the deposit methods listed in the table.
e-Collect - Direct Bank Deposit with Deduct Fee from Refund
This option requires that you have a bank account, account number, and bank routing number. Should your tax return not be free, any applicable tax preparation fees will be deducted from your expected tax refund. Furthermore, should there be a problem with the bank transfer (e.g. the wrong bank account name or number was entered), the processing bank - EPS Financial - will track this for you, which adds an additional layer of security for you. The processing bank - not eFile.com - will charge a fee for the bank services provided. The tax preparation fee will be deducted from your tax refund and the tax refund will be transferred by EPS Financial to the bank account you entered during the tax preparation process. Be aware that you will not see your bank account number, but the account number of EPS Financial on your PDF return form as eFile.com will instruct the IRS to transfer your refund to EPS. Please do not worry about this; the tracking method of this option is just as fast and up-to-date as all other deposit methods.
After you have selected e-Collect and successfully e-Filed an accepted tax return, take the following steps to check on your tax refund status:
- Check your tax return status on your eFile.com account.
- Check your refund status with the IRS and the status of your state tax return(s).
- Check your e-Collect tax refund payment status.
Direct Bank Deposit with Deduct Fee by Credit Card
Just like the e-Collect option outlined above, you will need to have a bank account, account number, and bank routing number. In addition, you will need a credit card to pay for your tax preparation fee should your return not be free on eFile.com. Your expected tax refund will be electronically issued and transferred from the IRS (U.S. Treasury) to the bank account you entered during your eFile.com online tax return process. This transfer is free of charge. Should you enter an incorrect bank account number, your funds will be transferred back to the IRS and/or state where they will issue a check in the mail to you. The online tracking method is as fast and up-to-date as the e-Collect option; follow steps 1 and 2 above.
Caution for joint filers: Some banks may not accept a direct deposit of a joint tax refund into an individual account. If your filing status is married filing jointly, please check with your bank or financial institution before requesting the deposit of a joint refund into an individual account.
If you are a U.S. citizen or resident living and/or working abroad and you have a U.S. bank account, you can directly deposit your refund into that account. Learn more about taxes as a U.S. citizen or resident living overseas.
IRS or State Refund Check by US Postal Mail
If you do not have a bank account or you otherwise wish to receive a tax return refund check from the IRS or state tax agency mailed to you by U.S. Postal Mail, select this option during checkout from the eFile.com tax app. Once your tax return has been accepted by the IRS and/or state, a paper check will be sent to you through the U.S. Postal Service. It generally takes at least twice as long as direct deposit to receive your refund through the mail.
Make sure that you review your name and address information on your tax return to make sure it's correct before you submit it to the IRS. If you move or change your address after you submitted your return, you will need to complete and sign online Form 8822, Change of Address, so the IRS has the latest address on file to send the check to you. Once you sign the form, select one of the save options, print it, and mail it to the IRS - FileIT.
If you are a U.S. Citizen or Resident and you are expecting a refund check, you might need to register with the State Department's Office of American Citizens Services and provide them with your most recent contact information (local address, phone number, email address, etc.). Contact them as often as possible when your information changes. This will help them reach you about the status of your delivered check in case the check does not list your correct mailing address.
Check your IRS and or state tax refund status via the steps listed above. If the information in the tool informs you that your refund check is mailed, but you have not received it within 45 days after the mailing date the IRS provides to you, call the International Taxpayer Service Call Center at 267-941-1000 (Monday-Friday, 6 am-11 pm EST).
Previous Year Tax Refund
Are you missing your 2019 tax refund that you filed for or an even earlier year refund? As a result of the COVID-19 Pandemic, the IRS saw many delays in issuing 2019 refunds for returns filed in 2020. The IRS "Where's My Refund?" tool only provides a status for the current year, so you are not able to conveniently check that status of a previous year refund this way. The only way to get information on your previous return it to contact the IRS directly.
When you contact the IRS, you will have to answer a series of identity verification questions. Have your supporting documents and information nearby, such as your SSN, the filing status of the year in question, and your refund amount, for example. Most importantly, you will want to have a copy of the return you are calling about.
If you filed with eFile.com:
Sign in to your eFile account - once there, navigate to My Account and see your previous year return(s). Open the one you need and have it ready by either leaving it open or printing a hard copy. You may need a submission ID - contact us here with your information so we can look up your previous return and provide you with this.
If you did not file with eFile.com:
See how to get a copy of your previous return if you do not already have one in your records. You will want to have this on hand that way you can reference specific parts of the return.
Once you have this prepared and have gotten through to an IRS representative, you will be able to find out what the status of your refund is. They may have rejected your return and that is why you never received your refund - they will advise on how to proceed - or they will provide information about your refund. If they need to reissue it via check, be sure to request a tracking number to give you some piece of mind.
For late refunds, the IRS may owe you interest if you filed on time the previous year and they took longer than 45 days to process your return.
Contact us if you have further questions about your tax return or tax refund status.
Review ways to pay taxes if you are not owed a refund and, instead, have a balance due on your 2020 Tax Return. See how eFile.com compares to other tax preparation services and learn how the eFile Tax App works. Begin tax preparing to be ready to e-file before Tax Day, April 15, 2021.
If you never received your tax refund or stimulus payment, complete Form 3911 and submit it to the IRS. Mail it to the IRS address based on your resident state.
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