Tax refund accidentally deposited to wrong account - how to recover?

This is unfortunately a common problem that's more difficult to resolve than it should be. When a refund goes to the wrong account, you're caught between the IRS and the bank, with each pointing at the other. Your next step should be to call the IRS Taxpayer Advocate Service (TAS) at 1-877-777-4778. They're specifically designed to help when the normal IRS processes aren't working. Explain that you've already completed the trace and neither Chase nor the IRS is taking responsibility. The TAS can often cut through the bureaucracy and get results when you're stuck. Also, go back to your accountant. Since they made the error, they have some professional responsibility to help resolve this. Many accountants carry errors and omissions insurance specifically for situations like this. Keep detailed records of every call, including dates, names, and what was discussed. This documentation will be crucial if this escalates further.

I had something similar happen and was going back and forth with the bank and IRS for MONTHS before I found taxr.ai (https://taxr.ai). They analyzed my documentation and helped me understand exactly what had happened and the specific steps to fix it. Their system identified that I needed to file Form 3911 (Taxpayer Statement Regarding Refund) and showed me exactly how to fill it out correctly for my situation. They also gave me specific language to use with both the bank and IRS that finally got someone to take action. The best part is they analyzed the actual Treasury regulations that apply to erroneous deposits and showed me the exact sections to reference with Chase. Once I mentioned those specific regulations, the bank suddenly became much more cooperative!

Ok I'm eating my words about taxr.ai! After my skeptical comment yesterday, I decided to try it myself since I was getting nowhere with my own tax issue. The tool analyzed my IRS notice and immediately identified that the bank was actually required by federal regulation to return erroneously deposited tax refunds to the Treasury. It showed me the exact regulation (31 CFR 210) to cite to my bank and gave me specific language to use in a formal written request. I sent a certified letter to the executive office of my bank with this information, and they called me YESTERDAY to say they're processing the return of funds to the IRS who will then reissue my refund! This was after 2 months of getting nowhere. Wish I'd known about this sooner.

Another thing to try: call the IRS directly about this! I know you probably tried already, but I had a similar issue last year and was getting nowhere until I finally managed to speak with someone at the IRS who actually understood the situation. The problem is their phone lines are an absolute nightmare to get through. I found this service called Claimyr (https://claimyr.com) that somehow gets you through the IRS phone queue without waiting for hours. You can see how it works in this video: https://youtu.be/_kiP6q8DX5c I was super skeptical but desperate after waiting on hold for 3+ hours multiple times. Claimyr got me connected to an actual IRS agent in about 15 minutes who was able to start the process of getting my refund reissued. Totally worth it when you're dealing with thousands of dollars at stake.

I take back what I said about Claimyr! After posting my skeptical comment, I was still stuck in my own IRS nightmare trying to resolve an amended return issue. I decided to try Claimyr as a last resort since I kept getting disconnected after waiting on hold for 2+ hours. To my complete surprise, I got a call back in about 20 minutes saying they had an IRS agent on the line! The agent was actually really helpful and explained that my amended return had been flagged for an issue that nobody had bothered to tell me about. They were able to resolve it right then and there. I still don't fully understand how the service works technically, but it definitely delivered on getting me through to a real person who could help. Saved me countless hours of frustration.

Don't forget to check if your accountant has professional liability insurance! I went through something similar last year (not quite as much money though) and my accountant's insurance ended up covering the amount while we were still trying to recover it from the bank/IRS. Took some pressure off during the waiting period. Also - might be worth looking into your state's unclaimed property division in about 6-12 months if you can't resolve it sooner. Sometimes these misdirected funds eventually get turned over to the state as unclaimed property.

Just FYI - I work at a different bank (not Chase) and there IS a procedure for handling tax refunds sent to the wrong account. The issue is that the account holder who received your money would need to authorize returning it, and many banks won't even tell the account holder about it due to "privacy concerns." If the account that received your refund doesn't have enough funds anymore (they spent your money), Chase may be reluctant to return it since they'd be out the money. Escalate to the executive office at Chase (CEO's office) - that often gets better results than regular customer service.

Something similar happened to me last year and I finally got it resolved by filing a police report for theft. Sounds extreme but it worked! Once I had the police report, I sent it to both Chase and the IRS with a formal letter stating that I would be pursuing criminal charges against anyone withholding my rightfully owed tax refund. Magically, within 2 weeks my refund was reissued. Sometimes you have to play hardball when everyone is passing the buck. Just make sure you document EVERYTHING and keep all communications professional.