Beginning with returns filed in 2015 (for 2014 tax year), the IRS will limit the number of refunds that are electronically deposited into a single bank account or prepaid debt card to three. This change is being made to crack down on fraud and identity theft. Any refund in excess of three will be made by paper check and mailed to the filer. Taxpayers will receive a notice informing them that the account has exceeded the direct deposit limits and they will receive a paper refund check if there are no issues with the tax return.
Families who routinely deposit the parents’ and children’s refunds into a single, family-held bank account should make other deposit arrangements or expect to receive paper refund checks next year. This may be an excellent opportunity to start a savings account your children!
If you need any assistance in filing your returns please contact Holbrook & Manter. Our professionals are ready to assist you in meeting all of your compliance obligation.