2017 TAX REFUND SEASON – BREAKING NEWS
Although the Tax Refund Selling Season started in October, the time to plan your Tax Refund Money Season is here. Each new year brings changes to the landscape, some more drastic than others. If your dealership is not prepared, disappointment could be the ultimate result.
2017 will not be any different. In fact, the changes this year will make preparedness essential to your success.
It’s called the PATH Act (Protecting Americans from Tax Hikes), a piece of legislation passed back in December of 2015. Buried deep within this law is a tax fraud safety measure that will affect nearly every special finance customer.
First, the official statement from IRS.gov, then what it means for you:
This change begins Jan. 1, 2017, and may affect some returns filed early in 2017. Additional information is listed below.
• To comply with the law, the IRS will hold the refunds on EITC and ACTC-related returns until
Feb. 15.
• This allows additional time to help prevent revenue lost due to identity theft and refund
fraud related to fabricated wages and withholdings.
• The IRS will hold the entire refund. Under the new law, the IRS cannot release the part of
the refund that is not associated with the EITC and ACTC.
• Taxpayers should file as they normally do, and tax return preparers should also submit
returns as they normally do.
• The IRS will begin accepting and processing tax returns once the filing season begins, as we
do every year. That will not change.
• The IRS still expects to issue most refunds in less than 21 days, though IRS will hold refunds
for EITC and ACTC-related tax returns filed early in 2017 until Feb. 15 and then begin
issuing them.
https://www.irs.gov/for-tax-pros/new-federal-tax-law-may-affect-some-refunds-filed-in-early-2017
Bill Neylan, President and CEO of Tax Max explains, “Early tax filers with children on their tax return can file starting January 2nd, just like normal.” He continues, “The only difference is that nearly all early filers within the Special Finance demographic will have to wait until AT LEAST February 15th to get their full refund, in an attempt to reduce tax refund fraud.”
We had a taste of this last year. In 2016, refunds were delayed 1 week by a blizzard from Washington DC to New York, halting operations in multiple IRS processing centers. An additional 3-5 day delay came from an IRS system crash on February 3rd, 2016.
The result of the delays was the largest tax refund release, or “money dump” in the history of the IRS. So much money was released on February 10th, financial systems crashed and bank locations ran out of money from all of the refund checks being cashed.
Expect similar chaos in 2017, with the primary dates being between February 15-20th.
By Chip Wiley