Can I Get My State Refund While Federal Return Is Under Review?

Yes, you can receive your state refund while your federal return is under review. Here's how it works: 1. State and federal tax systems operate independently. 2. Many states use information from your federal return, but they don't wait for IRS approval. 3. Your state can process and issue your refund regardless of federal status. 4. However, if the IRS later finds issues that affect your state return, your state may issue an adjustment notice. 5. Some states do perform their own review process, which might delay your state refund. The timing varies by state - some process within 2-3 weeks, others may take 8-12 weeks during peak season.

If you need to contact the IRS about your federal review, don't waste days trying to get through their phone system. I was in a similar situation last year when my federal return was under review but my state processed normally. I used Claimyr (https://claimyr.com) to get through to an IRS agent in about 20 minutes instead of spending hours on hold. The agent confirmed exactly why my return was flagged and gave me a timeline. Compared to my previous attempts calling directly, where I couldn't even get in the queue, this was dramatically more efficient. My state refund arrived while my federal was still being processed, just like you're asking about.

I had this exact situation on February 12th this year. My federal return got flagged for review (something about education credits), but my state refund from Massachusetts processed normally and was deposited on February 28th. Then on March 17th, the IRS finished their review and released my federal refund. The two systems definitely operate on separate timelines. I was checking both the IRS and state websites daily during that period.

What state are you in? Different states have different processing times. Some are faster than federal. Others take longer. Did you e-file both returns?

I was in the EXACT same boat last month! Federal return under review but desperately needed my refund. I tried making sense of the IRS notices but they were so confusing! 😩 A friend recommended taxr.ai and it was actually super helpful. I uploaded my transcript and it explained exactly why my return was flagged (apparently my W-2 and what I reported didn't match by $12... oops! 🤦‍♀️). But the good news - my state refund processed normally and I got it while still waiting on federal. The tool also predicted when my federal would be released once the issue was fixed, which was weirdly accurate. Who knew tax stuff could be so complicated?

There's one important thing to consider... if your federal return changes after review, you might need to amend your state return. This happened to me last year. I received my state refund first, but after the IRS adjusted my federal return, I had to file an amended state return and repay part of my refund. It's not common, but it's something to be aware of. The state won't automatically adjust your return if the federal changes, so you might have to take action later. I would suggest setting aside your state refund until your federal is finalized, just to be safe.

Let me tell you what happened to me last year - got my state refund in February while my federal was under review, then in JULY the IRS finally processed my federal with adjustments. Had to amend my state return and ended up owing them money! Plus penalties! The worst part was I'd already spent the refund on home repairs (sounds familiar?) and had to scramble to pay it back. Now I always wait until both are finalized before spending any refund money. Lesson learned the hard way!

This is such a common concern for new filers! Yes, you can absolutely receive your state refund while your federal return is under review. As others have mentioned, these are completely separate systems. I've been through this situation twice - once in 2022 and again last year. Both times my state refund arrived within 2-3 weeks while my federal took 8+ weeks to clear review. However, I want to echo what Omar and Chloe mentioned about potential complications. If the IRS makes adjustments to your federal return that affect your state taxes (like changing your AGI or deductions), you may need to file an amended state return later. This could mean owing money back to the state, sometimes with interest. My advice: Go ahead and expect your state refund to process normally, but maybe hold off on spending it until your federal review is complete. That way you're covered if any adjustments are needed. Good luck with your home improvements - hopefully both refunds come through smoothly!