Unexpected Employee Retention Credit Refund Delays

by | Dec 6, 2021

The IRS is experiencing continued delays

The IRS is currently backlogged with millions of unprocessed payroll tax returns due to the changes in COVID-19 safety protocols and the volume of Employee Retention Credit (ERC) refund requests.

As of November 17, 2021, the IRS posted that there are about 2.4 million unprocessed Forms 941 and approximately 400,000 unprocessed Forms 941-X. Additionally, the IRS advised that they will be processing all Forms 941 before they process the corresponding Forms 941-X. It is also rumored that the IRS may be processing 2020 payroll refunds before 2021 payroll refunds.

To check any new IRS status postings, visit: https://www.irs.gov/newsroom/irs-operations-during-covid-19-mission-critical-functions-continue and scroll down to “Filed a Tax Return”.

How long does it take to receive the ERC refund?

Previously it was expected that after the amended payroll reports have been filed, the IRS would issue refunds within six weeks to six months. We are now encouraging you to plan for a turnaround time of nine to twelve months.

How to check the status of your refund

To check the status of your refund, you can call the IRS at (877) 777-4778. Expect extended wait times. We recommend that the best course of action is to visit the IRS website. Unfortunately, we don’t expect there to be any new or additional information learned from a phone call conversation.

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