IRS To Delay Tax Refunds to Millions of Homeowners

IRS To Delay Tax Refunds to Millions of Homeowners

Own and home and pay interest on a mortgage? All taxpayers who want to deduct their mortgage-finance charges and related real estate costs must file a lengthy itemized return, rather than the simple 1040-EZ Form that can be completed by those who take the preset standard deduction. However, the Internal Revenue Service recently announced that it won’t be able to begin processing returns for the roughly 50 million taxpayers who itemize because the agency has to print new forms and update its computers.

The agency was blindsided by both Congress and President Barack Obama: It had most of its forms and computers ready to begin processing this month, but then had to start all over again after the controversial Bush tax cuts that were slated to expire at the end of 2010 were extended by our elected officials in late December.

The required updates will take several weeks to complete, the IRS says, so it won’t be able to begin processing itemized returns until mid or late February. The delay means that you’ll likely need to wait until April, May or even June to receive your refund check.

Despite the government’s holdup, you should file your return as quickly as possible so it will land on top of Uncle Sam’s 50-million stack rather than the bottom. The sooner you file, the faster you’ll get your refund.