PICKENS COUNTY — If, like millions of other Americans, the Earned Income Tax Credit is part of your tax filings this year, you can expect a longer than normal wait for your return.
According to the IRS, as result of a law designed to combat tax fraud, the agency is holding refunds for taxpayers claiming the EITC — or the additional child tax credit — until at least Feb. 15.
In reality, taxpayers taking advantage of these credits will probably have to wait even longer — closer to the end of February — to get their refunds due to weekends and President’s Day.
The delay is designed to give the IRS additional time to verify tax returns before refunds are issued.
Last year, the treasury inspector general for tax administration stated that nearly a quarter of the EITC refunds were flawed and that a substantial amount of improper payments were made.
The agency states that although some of those errors happen by mistake, others are caused by taxpayers purposely trying to claim larger refunds. In other words, fraud.
The EITC is designed to give workers with low to moderate incomes a tax break. It is claimed by over 27 million tax filers a year to the tune of $66 billion.
Both EITC and the additional child tax credit greatly reduce poverty rates for working families. In the years since its introduction, the credits have lifted an estimated 9.4 million people out of poverty — including 5 million children.
For the 2016 tax return, EITC maxes out at $6,269 this year for families with three or more children. The additional child tax credit is claimed by taxpayers who have children and who meet certain income requirements. That credit maxes out at $1,000 per child.
Because the credits are refundable, taxpayers can have the credits paid out as a tax refund — even if they don’t owe any taxes.
The IRS states that despite the hold, people should still file their returns as early as possible to give the IRS more time to review the documents and to avoid further delays with issuing refund checks.
Tax Day for 2017 is April 18, three days later than the typical deadline of April 15, due to the weekend.
Reach Kasie Strickland at 864-855-0355.