Hi, I’m Bette Hochberger, CPA, CGMA. Filing taxes is a significant annual event for most individuals and businesses. Once you’ve filed your taxes, you might wonder what happens next. The Internal Revenue Service (IRS) plays a crucial role in processing tax returns, ensuring compliance with tax laws, and issuing refunds or collecting taxes owed. In this blog, I’m going to discuss the journey your tax return takes after you file it.
Initial Processing
After you submit your tax return, whether electronically or by mail, it undergoes initial processing at the IRS. This step involves sorting and scanning the returns into their electronic system.
During this stage, they check for basic information such as your Social Security Number, filing status, and whether you’ve signed your return. If any essential information is missing or incorrect, it could delay the processing of your return, so make sure everything is accurate before filing.
IRS Tax Status “Accepted”
Once your tax return passes the initial checks, it receives a status of “accepted.” This means that the IRS has received your return and acknowledged it as valid for processing.
However, acceptance doesn’t necessarily imply that your return is error-free or that you’ll receive a refund. It simply indicates that they have successfully received your submission.
Checking for Errors and Inconsistencies
After acceptance, the IRS carefully examines your tax return for errors, inconsistencies, or potential red flags. They compare the information you’ve reported with data from third-party sources such as employers, financial institutions, and other government agencies. If they identify discrepancies, your return may undergo further review or audit.
Checking for Refund or Tax Liability
If you’re due a refund, the IRS processes your return to determine the amount owed to you. Conversely, if you owe taxes, they calculate your tax liability, including any penalties or interest accrued. They may adjust your refund or tax liability based on factors like deductions, credits, or changes in tax laws.
Handling of Issues or Audits
In some cases, the IRS may flag your return for issues that require additional attention. This could range from simple errors or omissions to more complex issues that warrant an audit. If your return is selected for an audit, they will notify you and request supporting documentation to verify the accuracy of your tax return.
Throughout this process, communication with the IRS may occur through mail, phone calls, or online portals. It’s important to respond promptly to any inquiries or requests for information to avoid delays or penalties.
So, filing your taxes is just the beginning of the journey. The IRS plays a vital role in processing tax returns, ensuring compliance with tax laws, and resolving any issues that may arise. Understanding what happens after you file your taxes can help alleviate any anxieties and ensure a smoother tax season experience.
I hope you learned something new today. As always, stay safe, and I will see you next time.
