In December of 2015, Congress passed a law called the Protecting Americans from Tax Hikes Act of 2015. This law made a lot of things that Congress had to renew each year permanent. That made our lives as tax preparers a lot easier.
What was overlooked by many was a small change on page 94 of the bill. This change in Section 201(b) of the bill states:
EARLIEST DATE FOR CERTAIN REFUNDS.—No
credit or refund of an overpayment for a taxable year shall
be made to a taxpayer before the 15th day of the second
month following the close of such taxable year if a credit
is allowed to such taxpayer under section 24 (by reason
of subsection (d) thereof) or 32 for such taxable year.
and amends Section 6402 to reflect these changes.
What does this mean in English?
It means that if you get a refundable tax credit, like the Earned Income Credit, the Additional Child Tax Credit, or the American Opportunity Credit, then you won’t get your refund until at least the middle of February.
Many people make their tax preparation appointments as soon as possible in the year so they can get their refunds as early as they can.
With this change, that whole plan has been thrown out the window by Congress.
Please adjust your plans accordingly.