IRS urges special refund recipients to delay filing taxes

Feb 7, 2023, 3:34 PM | Updated: 4:42 pm
FILE - A sign hangs outside the Internal Revenue Service building in Washington, on May 4, 2021. Th...

FILE - A sign hangs outside the Internal Revenue Service building in Washington, on May 4, 2021. The IRS issued guidance Friday, Feb. 3, 2023, recommending that taxpayers hold off on filing their tax returns for 2022 if they received a special tax refund or payment from their state last year due to the agency’s uncertainty about the taxability of the payments. (AP Photo/Patrick Semansky, File)

(AP Photo/Patrick Semansky, File)

NEW YORK (AP) — The Internal Revenue Service is recommending that taxpayers hold off on filing their tax returns for 2022 if they received a special tax refund or payment from their state last year.

Last year, 19 states offered diverse programs that offered inflation relief payments or refunds for taxpayers. The IRS issued the guidance Friday due to the agency’s uncertainty about the taxability of the payments.

“We are working with state tax officials as quickly as possible to provide additional information and clarity for taxpayers,” the IRS said in its statement.

For residents from states such as California and Illinois, the agency is recommending that they hold off on filing their tax returns until they receive further instruction from the IRS.

If you received a state tax refund last year, here is what you need to know.

I GOT A TAX REFUND FROM MY STATE. WHAT DOES THE IRS STATEMENT MEAN FOR ME?

If you got a tax refund from your state in 2022, the IRS is recommending you hold off on filing your tax return until the agency gives further instructions. Certain states that provided these refunds have determined that these payments are not taxable for most people. What needs to be determined is if these refunds are taxable on the federal level, said Tom O’Saben, director of tax content and government relations at the National Association of Tax Professionals.

In some states, people would get taxed if they received a tax refund in 2022 only if they itemize their deductions, said Keith Hall, president and CEO of the National Association for the Self-Employed. An example of a state that is taking this route is Virginia, which has stated that taxpayers that filed a standard deduction will not be taxed for their tax rebate. However, not all states have issued guidance on tax rebates.

WHY SHOULD I WAIT TO FILE MY RETURN?

Following the IRS recommendations is key if taxpayers want to avoid having to amend a previously filed tax return, said Hall.

“I think the IRS is trying to help people save another filing, if they had to do an amended return,” he said.

I RECEIVED A REFUND AND ALREADY FILED MY TAXES. WHAT SHOULD I DO?

The IRS is recommending that you don’t file an amended return yet. If you believe you need to file an amended return, the IRS advises you to wait until further instructions are given.

WHICH STATES OFFERED SPECIAL TAX REFUNDS IN 2022?

Special tax refunds were offered by 19 states in 2022. The list includes Alaska, California, Colorado, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Maine, Massachusetts, Minnesota, New Jersey, New Mexico, Oregon, Rhode Island, South Carolina, and Virginia.

WHAT IF I’M NOT SURE IF THIS APPLIES TO ME?

If you are not sure if you need to wait to file your taxes, Hall recommends you consult with a tax professional about your specific situation.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

(Facebook Photo/Superior Court of Arizona in Yavapai County)...
Associated Press

Arizona judge has cases reassigned following DUI arrest

The Arizona Supreme Court has ruled that all cases currently assigned to a Yavapai County Superior Court judge recently arrested on suspicion of extreme DUI will be reassigned to other judges.
1 day ago
Haitian migrant Gerson Solay, 28, carries his daughter, Bianca, as he and his family cross into Can...
Associated Press

US, Canada to end loophole that allows asylum-seekers to move between countries

President Joe Biden and Canadian Prime Minister Justin Trudeau on Friday announced a plan to close a loophole to an immigration agreement.
4 days ago
Expert skateboarder Di'Orr Greenwood, an artist born and raised in the Navajo Nation in Arizona and...
Associated Press

Indigenous skateboard art featured on new stamps unveiled at Phoenix skate park

The Postal Service unveiled the “Art of the Skateboard" stamps at a Phoenix skate park, featuring designs from Indigenous artists.
4 days ago
(Facebook Photo/City of San Luis, Arizona)...
Associated Press

San Luis authorities receive complaints about 911 calls going across border

Authorities in San Luis say they are receiving more complaints about 911 calls mistakenly going across the border.
10 days ago
(Pexels Photo)...
Associated Press

Daylight saving time begins in most of US this weekend

No time change is observed in Hawaii, most of Arizona, Puerto Rico, the U.S. Virgin Islands, American Samoa, Guam and the Northern Marianas.
18 days ago
Mexican army soldiers prepare a search mission for four U.S. citizens kidnapped by gunmen in Matamo...
Associated Press

How the 4 abducted Americans in Mexico were located

The anonymous tip that led Mexican authorities to a remote shack where four abducted Americans were held described armed men and blindfolds.
18 days ago

Sponsored Articles

(Desert Institute for Spine Care in Arizona Photo)...
Desert Institute for Spine Care in Arizona

5 common causes for chronic neck pain

Neck pain can debilitate one’s daily routine, yet 80% of people experience it in their lives and 20%-50% deal with it annually.
(Pexels Photo)...

Sports gambling can be fun for adults, but it’s a dangerous game for children

While adults may find that sports gambling is a way to enhance the experience with more than just fandom on the line, it can be a dangerous proposition if children get involved in the activity.
...
Quantum Fiber

How high-speed fiber internet edges out cable for everyday use

In a world where technology drives so much of our daily lives, a lack of high-speed internet can be a major issue.
IRS urges special refund recipients to delay filing taxes