Some taxpayers will get money back they have paid in to the Internal Revenue Service.
“Normally, you have to have at least 90% of what your tax bill is going to be withheld to avoid the under withholding penalty,” said Devine. “The IRS knew there was a problem. In January, we lowered that 90% to 85%, then in March, we lowered it again to 80%.”
A lot of people were done with their taxes by then.
“A lot of people had already filed, or they didn’t know that they could have requested a waiver for that penalty and they paid it,” said Devine. “The IRS is going to fix that.”
The IRS estimates about 400,000 taxpayers are going to be due a refund because they paid a penalty they didn’t have to pay. They don’t have to do anything.
“You’re going to get a letter in the mail,” said Devine. “It’s a notice that tells you what we’re doing. Then, a few weeks later, you’re going to get a check in the mail. We will not call you about this, so anyone who calls and wants to talk to you about a surprise refund, don’t believe it. If you have any questions, please go to IRS.gov. The system is set up to help you as much as possible.”
Because the U.S. tax system is pay-as-you-go, taxpayers are required by law to pay most of their tax obligation during the year, rather than at the end of the year.