IRS Expects Refunds to be Delayed for Some

The IRS plans to begin processing tax returns for the 2007 year on January 14, 2008. But some the processing of returns for some taxpayers will be delayed. Congress passed tax law changes in late Decemeber, mostly involving changes to the alternative minimum tax.

As a result of those late-in-the-year changes, the IRS announced it will delay the processing of tax returns containing the following forms or schedules:

• Form 1040A - Schedule 2, Child and Dependent Care Expenses
• Form 8863, Education Credits
• Form 5695, Residential Energy Credits
• Form 8396, Mortgage Interest Credit
• Form 8859, District of Columbia First-Time Homebuyer Credit

The IRS will not process tax returns containing those forms until February 11, 2008.

What should you do?

Individuals not filing these particular forms can file when they are ready and should not expect a delay in their refund. Individuals are who filing these forms should wait until at least February 11 before filing. They should also make sure their tax software is fully updated before attempting to electronically file their returns. The IRS also indicated that they will not accept any e-filed returns containing those forms until after they finish reprogramming their processing computers.

More information:

• Filing Season Opens on Time Except for Certain Taxpayers Potentially Affected by AMT Patch (IR-2007-209 from the IRS Web site)
• Alternative Minimum Tax – How It Affects Filing Season 2008 (from the IRS Web site)
• IRS: Late tax fix delays refunds (Associated Press via Yahoo News)