PATH Act Wolter Kluwer Standard Federal Tax Reports

Originally published on Page 3 of Wolters Kluwer’s Standard Federal Tax Reports,  Vol. 104, Issue Number 8, Report 8 on February 23, 2017. 

The IRS is beginning to release refunds affected by the Protecting Americans from Tax Hikes Act of 2015 (PATH Act). Some early filers had experienced refund delays. At the same time, the agency renewed its warning for taxpayers to be on the lookout for identity thieves and scam artists.

Take Away  “The PATH Act prevents the IRS from issuing refunds prior to February 15, 2017 for returns that claimed the earned income tax credit (EITC) or the additional child tax credit (ACTC). This is one example of the IRS’ continuing effort to implement safeguards against identity theft and refund fraud,” Barry Kleiman, CPA, told Wolters Kluwer.  “Other efforts include the Form W-2 verification code initiative, which has expanded from two million forms in 2016 to 50 million in 2017, and the use of filters, now up to 200, the IRS uses to help improve detection of fraudulent returns,” Kleiman, who serves on the Taxation of Individuals Committee of the New York State Society of CPAs (NYSSCPA), added.


As of February 10, 2017, the IRS has processed some 31.42 million returns, compared to 37.672 million at the same time in 2016. The total number of refunds issued was approximately 14 million, compared to some 29 million at the same time last year, representing a decline of 51.8 percent.  The IRS predicted that affected refunds may be available in bank accounts or on debit cards until the week of February 27.  The additional time is due to several factors, including weekends, the Presidents Day holiday and the time banks often need to process direct deposits, the agency explained.

Identity theft

Tax-related identity theft is especially common early in the filing season. The IRS explained that criminals seek to file fraudulent returns before taxpayers file their legitimate return. When taxpayers do file they legitimate return, they discover they have been victims of identity theft. The agency reminded taxpayers and tax professionals to update firewall and antivirus protections, recognize and avoid phishing scams along with telephone scams, and protect personal data both on paper and electronically.

Comment  “Everyone should guard their personal information by protecting their computers and using extreme caution when viewing emails or getting surprise phone calls,” Commissioner John Koskinen said.  “We encourage people to share this information. We all know someone who is challenged by technology, and some easy, common-sense steps could help protect these people from identity theft.””

Reference: TRC FILEIND: 18,052.

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