If the amount deposited into your bank account is different from the refund amount shown in the IRS Where's My Refund? tool, don't panic. There are several common reasons this can happen.
In many cases, the IRS adjusted your refund or part of your refund was applied to an outstanding debt before the money was sent to you.
Common Reasons Your Refund Amount Changed
1. Your Refund Was Reduced by an Offset
A tax refund offset happens when the government uses part or all of your refund to pay certain past-due debts, such as:
- Federal or state tax balances
- Child support obligations
- Certain federal agency debts
- State unemployment compensation debts
The IRS Where's My Refund? tool may show that an offset occurred, but it may not reflect every adjustment made to your refund. As a result, the amount deposited into your account could be lower than the amount displayed online.
2. The IRS Adjusted Your Tax Return
The IRS may review your return and make corrections before issuing your refund. Common adjustments can involve:
- Tax credits
- Income reporting
- Withholding amounts
- Calculation errors
If the IRS makes a change, they'll generally mail you a notice explaining what was adjusted and why. Most notices arrive within a few weeks after the refund is issued.
3. Tax Preparation Fees Were Taken From Your Refund
Did you choose the File & Go option and elect to have your tax preparation fees deducted from your refund?
If so, the IRS sends your full refund to a third-party processing bank. The bank then deducts:
- Your tax preparation fees
- Any applicable processing or convenience fees
The remaining balance is deposited into your bank account. Because of these deductions, the deposit amount will be less than the original refund amount reported by the IRS.
What Happens If My Refund Was Reduced?
If Your Refund Was Offset
If part of your refund was applied to a debt, you should receive a notice from the U.S. Department of the Treasury's Bureau of the Fiscal Service explaining:
- The amount of the offset
- The agency that received the funds
- Contact information for questions about the debt
If you need additional information about an offset, contact the Bureau of the Fiscal Service at 800-304-3107.
If the IRS Made Another Type of Adjustment
You'll also receive a notice if the IRS changed your refund for reasons other than an offset.
Page 1 of the notice typically explains the adjustment. Once you receive the notice, review the details carefully so you can determine whether any further action is needed.
The IRS Says My Refund Was Deposited, But I Don't See It in My Account
If the IRS Where's My Refund? tool shows that your refund was sent but the money has not appeared in your account, take these steps:
- Contact your bank to see whether the deposit has been received or is pending.
- Verify that the routing number and account number entered on your tax return are correct.
- If you chose to have your tax preparation fees deducted from your refund, contact Santa Barbara Tax Products Group (SBTPG) to check the status of the deposit.
Next Steps
Most refund discrepancies are caused by offsets, IRS adjustments, or fee deductions from your refund. Watch your mail for any notices from the IRS or the Bureau of the Fiscal Service, as these notices usually explain exactly why your refund amount changed.