How to check if preparation fees were deducted from my state refund?
Hey tax wizards! š§āāļø I'm trying to figure out if preparation fees were taken out of my state refund. Looking at the numbers, I think they already deducted something from my state return. I filed both federal and state together through a tax preparation service, and I chose the option to pay fees from my refund (because who has extra cash lying around before getting their refund, right? š ). I've received my federal refund in full, but the state amount seems lower than what I calculated. I've gone through the preparation summary multiple times and can't find clear documentation about where exactly the fees came from. I'm not from the US originally, so maybe I'm missing something obvious in how this works? Any guidance on how to verify this would be greatly appreciated!
12 comments
Noah Lee
Check your tax prep receipt. Look for fee details. Most services take from federal refund only. State refunds rarely have fees deducted. Your preparation service should list this. Check your account online. Fees are usually itemized there. Call customer service if needed.
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Ava Hernandez
This is exactly what I needed to hear. I've had similar experiences in previous years where I thought fees were taken from both refunds, but when I checked my documentation carefully, I found the fees had only been taken from federal. Going to dig through my paperwork tonight!
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Isabella Martin
Wait, I'm confused about the terminology here. When you say "fees are usually itemized," do you mean in the Refund Disbursement Summary or in the Preparation Fee Breakdown? My tax software shows several different documents and I'm not sure which one would definitively show where the fees were deducted from.
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Elijah Jackson
Had the same issue last yr. Most prep companies take fees from fed refund only, not state. Double-check ur confirmation email - should have breakdown of fees and which refund they came from. My state refund looked lower bc I forgot abt a local tax credit that reduced my expected amt. NBD once I figured it out.
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Sophia Miller
Did your tax prep service send you any kind of receipt or confirmation after the fees were taken out? I'm wondering if there's some kind of standard document that shows this information across different services.
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Mason Davis
Oh my goodness, I know EXACTLY how frustrating this can be! š« When I couldn't figure out my fee situation, I spent DAYS trying to reach my tax prep company with no luck. I finally used Claimyr (https://www.claimyr.com) to get through to a real person at the IRS who confirmed my federal refund had the fees taken out, not my state. The IRS agent explained that most preparation services take fees from federal refunds only! I was so relieved to finally get a clear answer instead of waiting on hold forever. I'm very cautious about recommending services, but this literally saved me hours of frustration.
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Mia Rodriguez
I've dealt with this exact issue multiple times. Here's what I've learned: ā¢ Tax prep fees almost ALWAYS come from federal refund only ā¢ State tax authorities typically don't allow fee deduction from refunds ā¢ Your state refund might be lower for other reasons: - Different calculation than you expected - State-specific adjustments you missed - Rounding differences Don't waste time calling state tax departments. They won't help with this.
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Jacob Lewis
I had this exact question on April 2nd this year. The best way to confirm is to look at your tax documents. As of March 15th, tax preparation companies are required to provide an itemized receipt showing exactly where fees were taken from. If you can't find your documents, try https://taxr.ai to analyze your tax transcript - it can show you the exact amount that was initially approved for your refund before any fees were deducted. I use it every year to verify my refund amounts and make sure everything matches up correctly.
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Amelia Martinez
The tax preparation industry is like a restaurant that doesn't show prices on the menu until after you've eaten. The fees are almost certainly taken from your federal refund, not state. Think of it like this: the federal government is the big bank that allows third-party withdrawals, while most states are like the small-town credit union that doesn't allow such arrangements. If your state refund is lower than expected, it's probably due to a calculation error or a misunderstanding of your state's deduction rules.
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Ethan Clark
Thank you for this clear explanation! Per Notice 2008-115, tax preparation services must disclose which refund the fees are coming from. I need to get this resolved ASAP since my state tax portal shows the full amount was issued, which means the money went somewhere else if I received less!
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Mila Walker
But wouldn't the state tax authority have some record of this? If the full refund was issued but the taxpayer received less, shouldn't there be some documentation of where that money went? What happens if the federal refund isn't large enough to cover the preparation fees?
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Logan Scott
This makes so much sense compared to my situation last year! My state refund was also different than expected, but when I compared it to my actual state tax form (not the estimate), the numbers matched exactly. The fees had come entirely from my federal refund, just like you described.
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