It looks like we may have repeat of past years with tax refund payment delays impacting millions of American’s once again.
While most of these delays are due to IRS processing backlogs from prior years the one that affects most people early in the tax season and who have already filed a return, is related to the PATH act.
According to the PATH Act, the IRS cannot Issue Refunds before mid-February
The following message, or minor variants of it, are what tax filers impacted by PATH delays would generally see when checking their refund status on IRS2Go or WMR. There is no reason to panic if you see this message – it is normal early in the tax season.
This is the standard IRS message for filers claiming the EITC and/or ACTC (which is different to the general CTC). See below for how this impacts you and expected dates when impacted refunds will be released this year.
2023 IRS PATH (w/EIC) Refund Direct Deposit Schedule
The IRS recently announced they will start releasing refunds for approved and processed filings held up due to the PATH act from February 28th, 2023. WMR and IRS2Go should update with refund payment status’ after February 18th.
Initial payments will be for taxpayers who have filed electronically and selected a direct deposit payment method for their refund. Once processing is complete and the refund is approved, these early E-filers can expect to get their refund by within a few days per the table below.
Refunds will be processed in batches – see cycle code in your transcript to get an idea of your release date – so early filers will see their payments first.
Estimated direct deposit dates are shown below. Paper checks generally take 5 to 7 days longer than direct deposit for IRS approved refunds. I will update thought out tax season and you can subscribe to get the latest updates.
|PATH Refund Approved For Week of:||Direct Deposit Payment Week|
|Feb 18 to Feb 24||Feb 27 to March 4|
|Feb 27 to March 3||March 6 to March 11|
|March 6 to March 10||March 13 to March 24|
|Will follow estimated IRS schedule||Every week till end of April|
Because everyone has a unique circumstance and various processing adjustments, some people are seeing updates early and have already received direct deposit payments ahead of schedule.
Also remember to try and get your refund payment via Direct Deposit, which the IRS’s recommends as the fastest and most secure method. You can sign-up for free online banking services like Chime to get a bank account, where you can get your IRS refund directly deposited into as soon as the day it is approved.
You can leave a comment below this article with your situation and I can try and answer it (or see others in a similar situation). Subscribe below to get the latest updates
You are lucky if early, but don’t be shocked if takes several days after the estimated dates to get your refund. See more in this recent YT video update for 2023 PATH updates.
IRS updates on 2023 PATH Processing – When Do I Get My Refund?
The IRS has published the following guidance around the PATH act this year per their EIC webpage. But it is important to remember the two key dates around your refund status versus the actual date you get your money.
There are 2 different event dates to keep in mind with the IRS PATH refund freeze. First, is your WMR/IRS2Go refund status, which will update by Feb 18, or sooner.
Your actual refund will be paid or direct deposited from around Feb 28th. In some cases your refund payments can come a few days earlier.
IRS Path Refund Processing and your Transcript
Even after the PATH act lifts, many folks will still see the “IRS is processing your return” message and no additional updates on their transcript. This is normal based on past year experiences. The IRS is continuing to deal with massive tax filing backlogs so PATH is only one reason things are delayed.
Further, just because the PATH act has lifted, don’t assume your return and refund was approved. There could be other processing issues (e.g. your claimed credits didn’t reconcile with IRS records) which may further delay your refund check or direct deposit.
However if you see code 846 (refund issued) on your transcript with a current or future date, then that is good news! It means your PATH held refund has been approved and will be paid once the PATH act lifts and IRS can legally send payments.
The initial PATH refund release date also assumes a direct deposit payment method and the overall return is approved. I.e no issues preventing refund release). You can also see more in this video.
What is the PATH act?
The Protecting Americans from Tax Hikes (PATH) was enacted by Congress a few years ago and specifies that the IRS must hold the entire refund — even the portion not associated with the the Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC) — until at least three weeks after the IRS starts processing returns (after Feb 15th).
The additional time is to allow the IRS to perform fraud checks and limit refunds from being issued to identity thieves or stop fraudulent claims with fabricated wages, dependents and withholdings.
Because these are fully refundable credits, in that no tax liability is needed to get to get these credits, additional checks are required to ensure they are being paid correctly and for eligible dependents.
Unfortunately due to the backlog of returns and expansion of these credits during the pandemic, the delay in paying PATH impacted refunds has been longer than three weeks.
Also remember, if you don’t get the refundable portion of the CTC, known as the ACTC, you won’t be subject to PATH. This is why some tax payers see their refund early when only eligible for the standard or non-refundable component on the CTC.
Past PATH Freeze End and Refund Payment Dates
While the PATH act says returns claiming the EITC or ACTC should be held for up to 3 weeks after the start of the tax season (when IRS accepts returns), IRS backlogs and other complications have meant that the actual release of approved refund has been longer than that.
The table below shows the expected vs actual dates the PATH act freeze was lifted in past seasons. These are the dates WMR and IRS2Go update with your refund status or payment date (also referred to as PATH Act returns). So expect a similar, albeit improving trend in 2023.
|Start of Tax Season||Expected PATH End Date||Actual PATH End Date||Refund Payment Starts From|
|January 23, 2023||February 18, 2023||February 20th, 2023 (est)||February 28, 2023|
|January 24, 2022||February 15, 2022||February 19, 2022||March 1, 2022|
|February 12, 2021||March 1, 2021||March 4, 2021||March 15, 2021|
|January 27, 2020||February 16, 2020||February 16, 2020||February 27, 2020|
To get the latest updates on the PATH act every season and every year, consider subscribing (free) via the the options below.
Does the PATH ACT Mean my Refund is Approved?
The PATH message does not mean your tax return is done and your tax refund is approved.
It simply means the IRS systems have identified you are claiming the (EITC) or the (ACTC) on your tax return, and so further processing and payments related to your refund are held up for the statutory hold period.
The WMR or IRS2Go app uses the PATH Message as a placeholder for all tax returns that have claimed these credits until freeze is lifted by the IRS. You can see more around the 152 notice here.
Once the PATH LAW lifts your personalized refund status will be shown on the Where’s My Refund? IRS tool. This will be around February 18th this year.
Anybody that files an early tax return, claiming the EITC or ACTC tax credits will be processed as soon as you file them. However any refund that would be due for those returns claiming one or both of these credits will be delayed.
So if your return was processed successfully (return approved status) your payment will be send shortly on or after Feb 16th. Otherwise the IRS will process the return in normal order.
It also does not mean your refund is approved and your refund could be held for other reasons based on IRS reviews.
Does the PATH act affect my state tax refund?
Technically no, since this is a federal act directed at the IRS. However given how intertwined your state and federal tax return is when it comes to income, exemptions, deductions and dependents it is rare to see them filed separately.
It is however common that if both your state and federal are filed accurately, your state refund could be approved and paid well before your federal refund from the IRS.
If there are discrepancies in the future with your federal return, your state tax agency will send you a notice seeking further explanation and likely recoup any underpayments in subsequent years. If they owe you more, you’ll get a check back for the additional refund.
State agencies may have different rules and guidance so I recommend checking their websites for official guidance.
Were there PATH Delays for Childless Workers claiming EIC?
Under the ARPA bill the Earned Income tax credit was tripled for childless workers. This was to offset the fact they would not benefit from the expanded child tax credit. This means a lot of workers with no children are now claiming the EIC.
However, a few forums and Facebook pages have said the PATH act delay does not apply to them, which is not congruent with the IRS page guidance which indicates all returns with these credits get held up (for 3 weeks)
So after some research the consensus is that those who are seeing a refund payment before the PATH act was lifted were in fact just getting an advance refund loan from their tax software provider (e.g. TurboTax or H&R Block). This advance refund payment is not the IRS refund.
It is just a service (free or sometimes charged) by these tax software providers who are confident you will get you refund. They will reconcile the refund you actually get from the IRS and adjust payment accordingly.
Should your tax refund be lower than expected and lower than the refund loan you will be obligated to pay back the difference.