It’s perhaps the very definition of Red Tape. Four years ago, Congress decided that the IRS should get into the banking business, authorizing it to give out no-interest loans to first-time homebuyers. That put the agency in the position of both collecting loan payments and issuing tax refunds to the roughly 1 million taxpayers who took advantage of the program.
This year, the odd arrangement overwhelmed IRS systems, and an unspecified number of taxpayers have been forced to wait four months or more for their tax refunds. In fact, many are still waiting.
“This is frustrating for taxpayers, and it’s frustrating for us,” said IRS spokesman Terry Lemons. “We deeply apologize.”
Making matters worse, taxpayers caught up in the vortex say they’ve been promised delivery dates for their refunds repeatedly, only to be disappointed or to discover their returns have been placed back into “error” status.
One of those taxpayers who’s been tantalized by repeated promises of a refund check is Tia Littlejohn, who lives in Maryland just outside Washington, D.C. She and her husband are planning to use their expected $6,800 refund to pay for in vitro fertilization. She’s had to postpone the procedure twice because promised tax refund dates have come and gone without payment.