Some tax refund direct deposit forms are filed incorrectly, according to IRS
The Internal Revenue Service is finding that some taxpayers are incorrectly filing Direct Deposit forms, causing their refunds to be mailed instead. The agency has advice for taxpayers to avoid this problem.
The federal agency instituted a new program this year to allow Direct Deposit of most federal income tax refunds to financial institutions. By properly filing Form 8888, "Direct Deposit of Refund," taxpayers can shorten the processing time for their refund by up to a week and have the other benefits of Direct Deposit, including the security of bypassing mail delivery. Previously, Direct Deposit was only offered to electronic and Form 1040PC filers.
According to the Internal Revenue Service, some Direct Deposit requests are not being seen timely by Service Center employees because of two reasons: taxpayers are not putting the form in its proper sequence; and they are cutting off the bottom portion of the form.
The instructions on the Direct Deposit request indicates it is to be placed directly behind the 1040 form when the return is filed. This includes Forms 1040, 1040A, 1040EZ, 1040NR, or 1040NR-EZ. Direct Deposit requests located behind other schedules and forms are not initially noticed under the assembly line procedures at the Service Center until later in the process when it is too late to make the choice.
The second problem occurs when taxpayers cut off the instruction portion of the form, making it easy to be mistaken for a W-2 form.
The IRS stressed that it is important for taxpayers to follow tax form instructions. IRS Service Centers receive millions of returns daily and these instructions are designed to aid in the processing effort.
Other common errors on tax returns noted by IRS include:
- For joint returns, both spouses must sign the return;
- Double-check math;
- Insure that all dependents have a social security number and that each number is correct;
- When sending a check, spell out "Internal Revenue Service" and include correct social security number, type of tax, and tax year;
- Double-check to insure using correct figures from proper tax table;
- Correct any ID or address errors directly on the mailing label that comes with the tax return (and then use the label), as using the label speeds the handling of the return (and any refund due) and lessens the likelihood of error;
- Be sure to save copies of the tax return and related documents to avoid having to pay IRS a $14 fee for a photocopy of the return.