IRS Forced to Update Tax System
Taxpayers who are planning on receiving an early tax refund from the IRS had better think again. This year the IRS doesn’t know when they will be ready to process tax returns, but it is rumored that it will likely be some time in February. The IRS lays the blame for the delay at the feet of Congress.
Congress waited until December 17, 2010 to add certain deductions and approve changes to the tax code, which has forced the IRS agency to change their system of processing tax claims.
Although the IRS stated that the majority of taxpayers will still be able to file as they normally do, those 50 million Americans that itemize deductions on Form 1040 Schedule A, and those that use Form 8917 for college student deductions, will not be able to have their returns processed until the IRS has finished updating the tax system and is ready to receive them.
Even taxpayers who don’t itemize deductions fear the update will cause a backlog within the IRS agency, which in turn would cause their own returns to be processed late. This could be detrimental to families relying on their tax refunds to pay bills or who have unemployed family members.