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I Need My Tax Refund!

by Ryan Guina

Actually, I don’t need my tax refund, not right away anyhow. But I’ve been hearing this comment frequently since tax season started, and even more frequently since the IRS announced the tax refund schedule. It seems as though this year the IRS implemented new anti-fraud measures in their tax software, which is designed to prevent identity thieves from wrongly claiming tax refunds which aren’t theirs. The result is massive delays in tax refund payments being sent out. Predictably, this has led to anger and frustration on the part of tax payers.

How Long Does it Take to Receive My Tax Refund?

Tax refunds usually don’t take long when they are e-filed. If there are no problems with your return, for example, everything is filed correctly the first time, the IRS doesn’t need additional information, and you don’t raise any audit flags, then you should normally receive your refund within about two weeks if you e-file and select direct deposit. Here is the direct deposit schedule for tax refunds.

If you file your taxes manually, then you should expect your return to be delayed an additional one to two weeks. This is because the IRS needs to manually input your information into their computers. Depending on the backlog of returns, it can take extra time to process your tax return. Additionally, you open yourself to more errors in your tax return, since it has to be manually processed – speed, accuracy, and security are all reasons why you should file electronically.

But I NEED My Tax Refund Now

Unfortunately, once you file your taxes, there really isn’t anything you can do to speed up the process. The IRS has measures in place to ensure they process tax returns as efficiently and expediently as possible. Keep in mind they will be processing hundreds of millions of tax returns in just a few short months. A two week turn around is nothing short of amazing, in my eyes (or slightly longer with the current delays the IRS is experiencing). If you want to check the current status of your tax return, then visit the IRS page: Where’s My Tax Refund?

But that doesn’t get down to answering your problem, does it? Let’s take a look at why you need your tax refund as soon as possible, and see if there are ways you can ease the financial strain, or avoid this in the future.

You Shouldn’t Rely on Your Tax Refund for Regular Bills

Emergencies happen. Big events happen. They are, by nature, unavoidable, and can catch you off guard even if you have an emergency fund and have been careful with your money. But relying on your tax refund to pay regular bills is a recipe for disaster. I know the economy is difficult and times are tough. But a tax refund is a once a year event, and is usually unpredictable in regard to how much money you will receive, and when you will receive it (as many people are finding out with these tax refund delays).

If you find yourself needing your tax refund to pay your electric bill, mortgage, or any other recurring bill, then you may be finding yourself in hot water very soon. What will you do when there is no tax refund next month, or the month after that?

If this is the position you find yourself in, then it’s a good idea to take a look at every expenditure in your household and find ways to save money, and or make more money.

Decrease Your Expenses, Increase Your Income

Saving money is always a good idea, but you will quickly reach a point where you can no longer cut back and still maintain the quality of life to which you are accustomed. Even so, this is usually the best place to start as you can often see immediate results with little effort. You can start with something as simple as cutting cable, finding better insurance rates, negotiating your property taxes, canceling memberships, or getting rid of an extra vehicle. What works for you will depend on your personal and financial situation.

Raising money is another great way to get out of a financial bind. You can do this by getting a part-time or full-time job, taking on consulting gigs or freelance work, selling items on Craigslist or eBay, or a variety of other side hustles. Here are some unusual ways to raise money fast which may work for you.

What Not to Do When You Need Money Quickly

Even if you find yourself needing money quickly, you may find it is best to wait things out an extra week or two as opposed to taking a bad deal on quick money. Tax Refund Anticipation Loans are almost never a good deal and don’t get you your money much more quickly than you would get it on your own – and the downside is they cost a huge percentage of your return. Payday loans and title loans can also cost you a substantial amount of money in the long run and should only be used as a last resort – and only if you are 100% certain you will be able to repay the loan in full when it comes due. Otherwise you will only be delaying the inevitable, and at an extreme cost.

Plan for Next Year’s Tax Refund

Now is the time to plan for next year’s tax refund. If you find yourself eligible for a Traditional IRA, you can make contributions throughout the year. This has two major benefits: the first is preparing for your retirement. Investing for your future will help you sleep better at night, and help you make it through your golden years with less worry. The second benefit is that it reduces your taxable income, which will help you get a higher tax refund next year than you otherwise would have been eligible for. Here are some good places to open an IRA where you can compare brokerages and IRA providers .


Published or updated January 6, 2014.
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{ 4 comments… read them below or add one }

1 Tyler S.

Counting on a sizeable return to pay for bills is definitely getting into risky territory, as is getting any kind of advance return. Planning ahead and being patient is the way to go.

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2 Kurt

Thanks for including the comment on Refund Anticipation Loans, a rip-off in the same category as payday loans. Did you know over half of RALs have been made to recipients of the Earned Income Tax Credit–i.e., those who can least afford the cost!

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3 Ryan

I think it’s a combination of a lack of education and a desperation for getting their money faster – even if it is substantially less than they would receive by waiting only a week or so.

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4 Mike

But the EIC is free money, so those people don’t even feel the pinch of it actually being their own money like those of us who are getting refunds due to overpayment. It’s just a free check so they don’t really care about how much it costs to get a RAL so long as they get that money in the next hour. Which is unfortunate, because with a little education and planning/budgeting, they could make their refund bigger by paying less fees.

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