Tax Refund Help

female_marineE7

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PEB Forum Veteran
Registered Member
I submitted a request to receive a refund for taxes taken out of my severance pay back in October. I received my severance pay back in June/July time frame. Given that I will likely receive my refund in the new year and have already received my 1099-R reflecting my severance payment and taxes withheld, what do I do when filing for taxes if I receive my tax refund in the new year? Has anyone had experience with this? I'm really frustrated at the time DFAS takes to rectify the tax refund requests. I think it is a disservice to those who have spent the time to do things right on their end. My letter I received actually stated that my severance pay should not have been taxed and DFAS completely ignores it. Any advice/assistance would greatly appreciated.
 
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Some thoughts on the matter without discussing DFAS' poor system of handling the tax situation associated with disability severance payments.

Once the tax is collected, the IRS has the responsibility of refunding the erroneous collection.

The DFAS 1099-R includes the taxes withheld. However, you know that at some point, possibly in 2020, the taxes will be refunded.

Since you have until April 15th to file your tax return and the refund should be disbursed before then, I would delay my filing for 2019 until the refund is received.

I am assuming DFAS is not going to issue a corrected 1099-R.

Upon receipt of the refund from the IRS, you could file the return with the documents you have and with a worksheet attached, show a reduction of taxes paid for 2019 and include the IRS documentation (if any) with your return.

A paper Federal Tax Return would be required; I do not see how this could be done electronically since the IRS matches the info reported with data they receive from other sources.

I have filed amended returns for certain years when the DFAS did not correct the taxable income for certain year when there were retroactive payments.

Just my thoughts on the matter. Recommend you visit with a tax professional and I do not include the tax-season strip mall services that open each year around this time.

Good luck...
Ron
(not a tax professional)
 
Some thoughts on the matter without discussing DFAS' poor system of handling the tax situation associated with disability severance payments.

Once the tax is collected, the IRS has the responsibility of refunding the erroneous collection.

The DFAS 1099-R includes the taxes withheld. However, you know that at some point, possibly in 2020, the taxes will be refunded.

Since you have until April 15th to file your tax return and the refund should be disbursed before then, I would delay my filing for 2019 until the refund is received.

I am assuming DFAS is not going to issue a corrected 1099-R.

Upon receipt of the refund from the IRS, you could file the return with the documents you have and with a worksheet attached, show a reduction of taxes paid for 2019 and include the IRS documentation (if any) with your return.

A paper Federal Tax Return would be required; I do not see how this could be done electronically since the IRS matches the info reported with data they receive from other sources.

I have filed amended returns for certain years when the DFAS did not correct the taxable income for certain year when there were retroactive payments.

Just my thoughts on the matter. Recommend you visit with a tax professional and I do not include the tax-season strip mall services that open each year around this time.

Good luck...
Ron
(not a tax professional)
Thanks Ron, it's annoying that I am having to jump through hoops to do this because DFAS cannot get their act together.
 
Thanks Ron, it's annoying that I am having to jump through hoops to do this because DFAS cannot get their act together.
Hello,

I put together some tax info pertaining to severance pay at —->THIS LINK

I still think that waiting until you receive the refund before filing your 2019 tax return would be wise.

One modification to my previous comments, although it might not pertain to you; it appears DFAS has the ability to refund the erroneously collected taxes if done during the same year (i.e., by the end of December).

Good luck,
Ron
 
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Hello,

I put together some tax info pertaining to severance pay at —->THIS LINK

I still think that waiting until you receive the refund before filing your 2019 tax return would be wise.

One modification to my previous comments, although it might not pertain to you; it appears DFAS has the ability to refund the erroneously collected taxes if done during the same year (i.e., by the end of December).

Good luck,
Ron

Ron, thanks for the info -- your last comment, so if I submitted all my paperwork to DFAS in October (which would have been before December), I should still be good to receive a refund from them, correct?
 
Ron, thanks for the info -- your last comment, so if I submitted all my paperwork to DFAS in October (which would have been before December), I should still be good to receive a refund from them, correct?
In my world...yes.

In the DFAS world...remains to be seen. Let us know how this turns out please.

(DFAS is able to make adjustments for a current calendar year.)

Ron
 
I spoke to DFAS today, they are now telling me that its a 60 day wait from the time the request goes into review. Based on that, I am just over 30 days and should check back at the first week of February. The first week of February will be the 4 month mark from the date DFAS received my request (120 days).

In my world...yes.

In the DFAS world...remains to be seen. Let us know how this turns out please.

(DFAS is able to make adjustments for a current calendar year.)

Ron

Ron, do you happen to know of anyone who submitted a tax refund request prior to December and received a refund in the following year?
 
I spoke to DFAS today, they are now telling me that its a 60 day wait from the time the request goes into review. Based on that, I am just over 30 days and should check back at the first week of February. The first week of February will be the 4 month mark from the date DFAS received my request (120 days).



Ron, do you happen to know of anyone who submitted a tax refund request prior to December and received a refund in the following year?
No...but that does not mean it won't occur.

Opinion: Based on observations of more than 15 years, the processing time for one person's retro action by DFAS is not necessarily what will occur in the case of another.

Ron
 
Good Morning,

@female_marineE7 I am in the same boat as you are however I received my severance in June and submitted paperwork to get the taxes recouped in November. In my opinion I think that your best bet is to start the process with the IRS. My submission to DFAS was being processed since December and I would call every couple weeks to get an update and did not get a straight answer. Finally after several tickets to DFAS I was called and apologized to for delay in processing and was told that unfortunately due to their lack of action, the request would now have to be submitted to the IRS. I just submitted my paperwork to them today after speaking with an IRS agent. In my opinion this site helped with some of my questions Disability severance pay military

Also if you are still having questions about it contact the IRS and they will walk you through it. They did this for me. Ensure you have a 1099 with the amount that was withheld from DFAS, and finally I was also in the Marine Corps so were in the same boat. Good Luck and Semper Fi!
 
Good Morning,

@female_marineE7 I am in the same boat as you are however I received my severance in June and submitted paperwork to get the taxes recouped in November. In my opinion I think that your best bet is to start the process with the IRS. My submission to DFAS was being processed since December and I would call every couple weeks to get an update and did not get a straight answer. Finally after several tickets to DFAS I was called and apologized to for delay in processing and was told that unfortunately due to their lack of action, the request would now have to be submitted to the IRS. I just submitted my paperwork to them today after speaking with an IRS agent. In my opinion this site helped with some of my questions Disability severance pay military

Also if you are still having questions about it contact the IRS and they will walk you through it. They did this for me. Ensure you have a 1099 with the amount that was withheld from DFAS, and finally I was also in the Marine Corps so were in the same boat. Good Luck and Semper Fi!

I received my taxes back already. Thanks though.
 
I received my taxes back already. Thanks though.

How long did it take for you to receive your taxes back? I just submitted my Tax Refund claim today through DFAS. I received my severance pay this year and applied for a refund within the same year. What is a general timeline that you could give @female_marineE7 ? Congratulations by the way!
 
How long did it take for you to receive your taxes back? I just submitted my Tax Refund claim today through DFAS. I received my severance pay this year and applied for a refund within the same year. What is a general timeline that you could give @female_marineE7 ? Congratulations by the way!
I submitted my request in October 2019 and got it in February but it was not without assistance from a person on here. He gave me his direct contact and she was able to push it through. Without her help, I don't think it would have been paid before 6 months.
 
Is it possible to get this person's information? I know I will be in the same process here pretty soon.
 
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