New Mandatory IRS Tax Refund Delay Change is Important News for Taxpayers

It is more important than ever to prepare accurate income tax returns during the 2017 tax season. A new law requires the IRS to delay issuing refunds for certain taxpayers claiming the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) until February 15. The law has no exceptions and is designed to make it easier for the IRS to find and stop fraud. However, the impact on individuals and families who count on a speedy refund can be problematic and expensive if they fall prey to quick fix solutions.

The IRS will begin releasing EITC and ACTC refunds starting Feb. 15. However, the IRS cautions taxpayers that these refunds likely won’t arrive in bank accounts or on debit cards until the week of Feb. 27 (assuming there are no processing issues with the tax return and the taxpayer chose direct deposit). This additional period is due to several factors, including banking and financial systems needing time to process deposits.

The tax refund delay will likely cause problems for many taxpayers who receive the EITC or ACTC. These taxpayers are low-income working taxpayers, the vast majority of whom have children. They often depend on receiving their refunds early in the tax season to help pay for groceries, holiday bills, overdue utility debt, or other pressing expenses.

Even though refunds may be delayed, taxpayers should still file as early as possible. In addition to making sure the refund can be processed as soon as possible after February 15, early filing provides a cushion of time if a tax return has other issues, such as math errors.

United Way of Lancaster County’s VITA Program is one of more than 12,000 Volunteer Income Tax Assistance (VITA) programs across the country that the IRS relies on to help people file their taxes every year, completely free of charge. In 2016 alone, United Way’s IRS certified volunteers helped more than 7,500 individuals in Lancaster County qualify for and keep 100% of their refunds - exceeding $9.6 million - without worrying about hidden fees or unexpected charges.

Many clients receive more than 30% of their annual income in tax refunds, making their tax returns vital to their financial lives. “For ten years, United Way of Lancaster County’s VITA Program has helped individuals and families get their maximum refund that they use on necessities, like paying bills, paying down debt, making new purchases and saving,” said Steve O’Neill, VITA director. “We plan to open our 17 VITA sites on January 23 and we are dedicated to ensuring that our taxpayers get all of their refund as soon as the IRS refund delay allows.”

“Don’t let people take advantage of you by claiming to be able to get you a quicker refund,” O’Neill adds. “High-interest loans and short-term advances on your refund will only cost you in the long run.”

Who can get free tax prep? VITA provides free tax preparation services (federal, state and local) to taxpayers who make less than $62,000 who live, work or go to school in Lancaster County.

High Quality Service. The volunteer tax preparers at United Way’s free tax preparation sites go through at least 40 hours of training and are certified by the IRS. Customers get high-quality, professional service by trained volunteers who are equipped to identify tax refund opportunities for customers. Our goal is to help our customers get their maximum refund and claim all the credits that they have earned. During the 2015 filing season alone, more than 90,000 volunteers nationwide helped prepare greater than 3.7 million returns at thousands of tax sites.

How to Schedule. To schedule an appointment at one of VITA’s 17 tax preparation sites around Lancaster County or get more information, taxpayers should call 2-1-1 to speak with one of United Way's trained information and referral specialists. For VITA locations, eligibility requirements, and other details, visit www.FreeTaxPrepLancaster.org.

VITA also offers a free online program that allows taxpayers to file federal and state tax returns at www.MyFreeTaxes.com.

United Way of Lancaster County’s VITA program is one of many sponsored by the Internal Revenue Service. In addition to IRS funding, VITA receives vital support from Ephrata National Bank, Fulton Bank, PNC Bank, and United Way of Lancaster County’s Women UNITED.

January 9, 2017