Don’t Panic: A Rejected E-File Isn’t the End of the World
Filing your taxes online offers speed and convenience, but receiving an e-file rejection notice can be stressful, especially when the April 15th deadline is looming. The good news is that if your return was submitted on time, the IRS provides a crucial window to fix the problem. This is known as the e-file rejection grace period.
What Is the IRS E-File Rejection Grace Period?
If you electronically file your Form 1040 on or just before the tax deadline and it gets rejected, the IRS allows a five-day grace period to correct the errors and resubmit the return electronically. If you successfully resubmit within this five-day window, your return will be considered timely filed, helping you avoid potential late-filing penalties.
For example, if you e-file on April 15th and it’s rejected, you have until April 20th to successfully re-file electronically.
Common Reasons for E-File Rejection
An e-file rejection is not a tax audit; it simply means there’s an error in the information provided. Most rejections are due to simple, fixable mistakes. Common reasons include:
- Incorrect Personal Information: A misspelled name, an incorrect Social Security Number (SSN), or a wrong date of birth for you, your spouse, or a dependent is a primary cause for rejection.
- AGI (Adjusted Gross Income) Mismatch: When you file, you must enter your AGI from the previous year to verify your identity. If this number doesn’t match what the IRS has on record, your return will be rejected.
- A Dependent Was Claimed on Another Return: If another person, such as an ex-spouse, has already claimed your dependent, the second return filed with that dependent’s SSN will be rejected.
- Incorrect Bank Account Information: If you’re opting for direct deposit of your refund, a mistyped routing or account number can cause a rejection.
Step-by-Step: What to Do If Your E-Filed Return is Rejected
- Review the Rejection Notice: Your tax software or e-filing service will provide a rejection code and an explanation for the rejection. This will tell you exactly what you need to fix.
- Correct the Errors: Log back into your tax software and navigate to the section that contains the error. Carefully correct the information as indicated in the rejection notice.
- Resubmit Your Return Electronically: Once you’ve made the corrections, you can re-file your return electronically. As long as you are within the five-day grace period, you will not be considered late.
What If You Can’t Fix the Issue in Time?
If you can’t resolve the issue within the five-day grace period, you still have an option to avoid late penalties: filing by mail. If you must mail your return after a rejection, you generally have 10 calendar days after the rejection notification to postmark your paper return.
To ensure it’s processed correctly, you should:
- Print a copy of your corrected tax return.
- Sign and date the return.
- Include a copy of the IRS rejection notification.
- Mail it to the IRS address listed in the form instructions.
A Note on State Tax Returns
It’s important to remember that this grace period applies to your federal tax return. States have their own rules and deadlines for handling rejected e-filed returns. Be sure to check with your state’s tax agency for their specific procedures.
