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By Suzanne Blake
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Some Americans may be waiting longer than expected for their state tax refunds this year as several states grapple with processing delays.
Most of the delays stem from changes in tax law and administrative backlogs, and residents in Idaho, New York, Oregon, South Carolina, and Washington, D.C. are likely to be affected.
Why It Matters
For many Americans, state tax refunds are not just a financial bonus but a critical source of cash used to cover everyday expenses such as rent, groceries, utilities, and debt payments. When those refunds are delayed, households can feel an immediate financial squeeze.
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Since inflation and high living costs have already strained household budgets, even short‑term delays can force families to rely on credit cards or savings, significantly increasing financial stress.
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What To Know
The full list of states/areas likely to experience delays in state tax refunds includes:
- Idaho
- New York
- Oregon
- South Carolina
- Washington, D.C.
The delays stem largely from how states are handling recent federal and state tax law changes. While federal returns are generally processed more quickly, state tax agencies operate independently and must update their own systems and forms to reflect new rules.
In some cases, those updates are still underway, slowing the release of refunds.
In Idaho, budget cuts cause the tax season workforce to be smaller, potentially slowing tax processing by up to six weeks for refunds, according to a memo from Lori Wolff, the state’s administrator for the Division of Financial Management.
Meanwhile, New Yorkers are facing a software issue with Intuit TurboTax that could prevent filing and delay refunds.
In Oregon, taxpayers who filed paper returns won’t see their refunds processed until at least the end of the month, according to the state’s Department of Revenue. This means refunds won’t be issued until early April, regardless of when they were filed.
And in South Carolina, the state’s Department of Revenue warned that tax processing will be delayed because it will not conform to new federal tax laws passed by the Trump administration. State taxpayers will have to add back income that is deducted at the federal level this year, including some tips, overtime and senior deductions.
The District of Columbia also voted last year not to conform to new tax laws, but Congress has reversed that decision, likely still leading to delays in income tax refunds.
What People Are Saying
Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: “Some taxpayers may see a delay in receiving their state tax refunds depending on where they live and whether issues currently affecting tax season are resolved quickly or not…If you live in these states, you want to stay up to date on delays and ensure these complications don't affect your returns. If they do, you may need to file an amended return.”
What Happens Next
Taxpayers in the affected states are encouraged to monitor their state revenue department’s refund-tracking tools for updates, as timelines may vary by filing method and individual circumstances.
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