Every year, early filers are shocked when they learn that even the portion of their refund unrelated to the Earned Income Tax Credit (EITC) or the Additional Child Tax Credit (ACTC) is still being held. Many taxpayers assume that since only part of their refund comes from these credits, the IRS should release the rest immediately.

But that’s not how the law works.

If you claim even one dollar of EITC or ACTC, your entire federal income tax refund is frozen until at least February 15 under the PATH Act.

This rule creates one of the most misunderstood refund delays every tax season. Here’s what you need to know.

Why the Entire Refund Is Held

The Protecting Americans from Tax Hikes Act (PATH Act) requires the IRS to delay the release of refunds that include EITC or ACTC until mid-February.

The key word is refund, not “credit.”

This means:

• Your wage withholding refund
• Any excess federal taxes paid
• Any refundable credits
• Even non-credit related refund amounts

All must remain on hold until the IRS is legally allowed to issue the refund, regardless of source.

It’s an “all or nothing” release.

If you claim EITC or ACTC, none of your refund can be issued early—not even the portion that comes directly from your W-2 withholding.

Why the Law Freezes Everything

Congress designed the PATH Act to combat tax identity theft and refund fraud—especially involving refundable credits.

To properly verify returns, the IRS must:

• Match employer wage data (W-2 records)
• Confirm dependent eligibility
• Validate tax withholding
• Run identity theft checks
• Verify credit calculations

These checks take time, and employer wage data is often not fully available until late January.

Rather than splitting refunds into partial payments—which is operationally complex and fraud-prone—the IRS holds the entire refund until the full verification process is complete.

What This Means for You (2026 Filing Season)

If your return contains EITC or ACTC:

• The earliest your refund can be issued is February 15
• The deposit typically arrives 1–3 business days after TC 846 posts
• Filing early does not speed up the release date
• Calling the IRS will not override federal law
• WMR will continue showing “Still Processing” until the hold lifts

Even if your refundable credits are small, the entire refund must wait until the statutory date.

Example: Why You Still Have to Wait

Let’s say your total refund is $3,500:

• $2,000 comes from wage withholding
• $1,500 comes from ACTC

Even though $2,000 has nothing to do with credits:

The full $3,500 refund must be held until after February 15.
You cannot receive partial amounts early.

Transcript Codes That Confirm the Hold

If you pull your IRS account transcript, you’ll usually see:

• TC 570 – Additional Account Action Pending
  (This confirms a hold on the refund)
• TC 971 – Notice Issued
  (Often a routine PATH Act informational notice)
• No TC 846
  (Refund cannot be issued yet)

After the PATH Act barrier lifts in mid-February:

• TC 571 – Hold Released
  or
• TC 846 – Refund Issued

will appear once your refund is released.

Common Myths About the PATH Act

Myth 1: “I should at least get my withholding back.”

False. The law requires holding the entire refund if EITC or ACTC is present.

Myth 2: “Direct deposit should bypass the hold.”

False. The IRS cannot legally release the funds early, regardless of payment method.

Myth 3: “I filed early, so I should get paid early.”

False. Filing early only positions your return for release on or after the legal date.

Myth 4: “Other credits aren’t delayed, so I should get the rest.”

False. The IRS does not split refunds when EITC/ACTC are part of the return.

How to Prepare for the February 15 Release

✔ Expect the delay

If you claim EITC or ACTC, it applies automatically.

✔ Monitor your transcripts

Your transcript will update before WMR.

✔ Use direct deposit

It ensures the fastest release once TC 846 posts.

✔ Avoid errors

Any mismatch delay stacks on top of the PATH Act delay.

✔ File early, but with realistic expectations

Early filers still get paid mid-February—not earlier.

If your return includes EITC or ACTC, the PATH Act requires the IRS to freeze your entire refund, not just the credit portion. No part of the refund can legally be issued before mid-February.

Understanding this rule eliminates confusion and sets the right expectations for your refund timeline.