IRS Refund Delays in 2025 – Here’s Why Your Money Is Stuck

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As tax season unfolds, many taxpayers are wondering why their IRS refunds are taking longer than expected. The 2025 tax filing season has been hit by staffing shortages, federal hiring freezes, and backlogs that are slowing down processing times.

If you’re still waiting for your refund, here’s what might be causing the delays and how you can avoid getting caught in the IRS backlog.

IRS Staffing Shortages and Backlogs

One of the biggest reasons behind delayed refunds in 2025 is the ongoing staffing crisis at the IRS. While the agency has grown its workforce to over 100,000 employees for the first time in decades, nearly 18% of its employees are eligible for retirement, and 37% will be eligible within the next five years.

Impact of the 2025 Hiring Freeze

The situation worsened when a federal hiring freeze was implemented on January 20, 2025. This move led the IRS to cancel job offers for new hires, making it harder for the agency to process tax returns efficiently.

Why Some Refunds Are Taking Longer

Beyond staffing shortages, several other factors are causing refund delays:

  • Errors on tax returns: Even minor mistakes can trigger a manual review, delaying refunds.
  • Paper filings: The IRS prioritizes electronic returns, while paper returns take much longer to process.
  • Identity verification holds: If the IRS suspects fraud or identity theft, additional verification steps may be required.
  • Earned Income Tax Credit (EITC) and Additional Child Tax Credit (ACTC): By law, refunds for these credits cannot be issued before mid-February, with most arriving around March 3, 2025.

How to Avoid IRS Refund Delays

While you can’t control IRS staffing levels, you can take steps to ensure your refund isn’t delayed unnecessarily:

  • File electronically – E-filing is processed much faster than mailing in a paper return.
  • Use direct deposit – Opting for direct deposit instead of a paper check speeds up your refund.
  • Double-check your return – Errors and missing information can trigger a delay.
  • Monitor your refund status – Use the IRS “Where’s My Refund?” tool to track your payment.
  • Be aware of tax credits – If you claim the EITC or ACTC, expect a later refund.

The IRS is facing significant processing backlogs due to workforce challenges, hiring freezes, and an overwhelming number of tax returns. If your refund is delayed, don’t panic—but do take proactive steps to file correctly and track your status. For the latest updates, visit IRS.gov.

 

Emma Bennett

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