Imagine this scenario: You mail your tax forms and breathe a sigh of relief. But just as you’re about to give yourself a pat on the back for filing early, you become filled with dread. Much to your horror, as you glance at copies of your paperwork, you realize you gave Uncle Sam an incorrect bank account number. What should you do? The most important thing is that you act quickly. The longer you wait to remedy the situation, the more difficult it will be to get your money back. Here are a few tips for how to rescue your money in the following situations.
You caught the mistake early
If you’re lucky enough to catch the error before your return posts to the IRS system, you might be able to stop the deposit. You can make this request by calling the IRS at 800-829-1040. You can also investigate the whereabouts of your refund by using the IRS2Go mobile app or logging on to Where’s My Refund? Information is updated every 24 hours.
You omitted a number
If you accidently deleted a figure from your bank account or routing number, you’re also less likely to have a tax-time mess on your hands. The Internal Revenue Service usually handles this by mailing your refund via paper check.
You gave the IRS a number linked to another customer’s account
If the deposit is made but the account number you provided does not belong to anyone, your bank will reject the check and send it back to the IRS. However, if the number is attached to another account, the solution will not be so quick and tidy. The next step will be for you to work directly with your bank to resolve the issue.
“You should contact the bank’s automated clearinghouse department as soon as possible,” says Marquita Miller, accountant and founder of Five Star Tax and Business Solutions. “Banks have a daily exceptions report that they review before they will return the money. Many times, they can correct the account number after they have been contacted. After confirming your identify, they can correct the bank information and incorrect number listed on the report.”
It will generally take about two weeks for your bank to respond to your query. However, if two weeks have passed and your problem has not been appropriately addressed, you’ll then have to file Form 3911 (“Taxpayer Statement Regarding Refund”). Filing this form will begin the process of tracking down the location of your tax refund.
Your bank won’t help you
In this worst-cast scenario, things could get ugly. There is a possibility that the funds might not be available (for example, if the customer spent the cash), or the banking institution could simply decline to cooperate. Unfortunately, at this stage, the IRS is not required to force your bank to release the money. The IRS clearly states on its website that it “assumes no responsibility for tax preparer or taxpayer error.” Consequently, you may have to take legal action to recover the funds.