Roughly one in five electronically filed tax returns that claim certain credits or deductions gets flagged for additional review by the IRS — a process that can stretch a projected 21-day refund window into months. For people who have built their household budgets around that refund, the wait isn’t an inconvenience. It’s a financial emergency.
I first connected with Theresa Fulton through a veterans’ support group in Indianapolis that had invited me to attend one of their monthly financial resilience meetings in January 2026. Theresa, 35, isn’t a veteran herself — she came as a guest of her younger brother Marcus, a 22-year-old college student she’s been partially supporting since he enrolled at IUPUI in the fall of 2023. She’d mentioned her tax situation to the group almost offhandedly, and the group coordinator pulled me aside afterward and said I should talk to her. I’m glad I did.
When I sat down with Theresa at a coffee shop near her school on a Tuesday afternoon in February, she had her phone face-up on the table, the IRS Where’s My Refund tool already pulled up. She’d been checking it daily for three weeks.
The Budget That Depended on Two Income Streams
Theresa Fulton has taught high school math at a public school on Indianapolis’s east side for nine years. Her base salary in the 2025–2026 school year is approximately $52,400. That sounds stable on paper, but Theresa’s financial picture has never been that simple.
For four years, she supplemented that income with a district-funded after-school tutoring stipend — roughly $350 per month, or about $4,200 annually. It wasn’t glamorous work, but it was consistent, and she’d built her monthly budget around it. She used it primarily to cover Marcus’s dorm fees and textbook costs.
In June 2025, the district eliminated the after-school tutoring program due to a budget shortfall. Theresa found out via email on a Thursday. By the following Tuesday, she was recalculating every line item in her monthly budget. “I didn’t panic at first,” she told me. “I thought, okay, I’ll just be more careful. But ‘more careful’ doesn’t pay Marcus’s housing bill.”
With no retirement savings — she’d never been able to prioritize contributions to her district’s 403(b) plan — and no financial cushion to speak of, Theresa turned her attention to the one thing she could reasonably count on: her annual tax refund.
Filing Early and Expecting a Quick Turnaround
Theresa filed her 2025 federal return electronically on January 29, 2026 — the first full day the IRS accepted returns that season. She used a popular tax software platform and received an immediate confirmation. Based on the IRS’s published guidance, she expected her refund within 21 days, placing the estimated deposit around February 19, 2026.
Her return included a claim for the Earned Income Tax Credit (EITC), which she’d qualified for in prior years due to her adjusted gross income. Under the PATH Act, the IRS is legally required to hold refunds that include EITC or the Additional Child Tax Credit until at least mid-February — a rule designed to reduce fraud. According to IRS guidance on PATH Act refunds, most affected filers see their deposits by February 27 in a normal processing year.
Theresa knew about the PATH Act hold — she’d dealt with it before. What she didn’t expect was what came next.
Sixty-One Days and a Letter She Didn’t Know How to Read
By March 1, 2026, Theresa’s Where’s My Refund status had shifted from “Return Received” to “Still Processing” — without ever hitting “Refund Approved.” That single status change, she told me, was the moment her anxiety moved from background noise to something louder.
On March 8, 2026, a letter arrived. It was an IRS CP05 Notice — a document the IRS sends when it needs additional time to review a return, typically to verify income, withholding, or tax credits. The notice didn’t accuse Theresa of anything. It didn’t request documents. It simply said the IRS needed up to 60 more days to complete its review.
Theresa sat with that letter for two days before she fully understood what it meant for her cash flow. Marcus’s spring semester housing payment — $1,840 — was due March 20.
The Turning Point — and What It Cost Her
Theresa told me she called the IRS Taxpayer Assistance line on March 10. After a 47-minute hold, she reached an agent who confirmed what the CP05 had already said: no additional documents were needed, the review was routine, and there was no estimated release date she could plan around. She wrote the words “no date” in her planner and circled them.
To cover Marcus’s housing payment on March 20, Theresa borrowed $1,200 from a close friend and used $640 from her emergency savings — a fund she described as “more of an emergency suggestion than an actual fund.” She paid 0% interest on the personal loan, but told me the psychological cost was significant.
On March 31, 2026 — exactly 61 days after she filed — Theresa’s bank account received a direct deposit of $3,847. No explanation accompanied it. The Where’s My Refund tool updated to “Refund Sent” sometime that morning. She found out by checking her banking app, not the IRS portal.
What Theresa Says She Learned — and What She’s Still Worried About
When I asked Theresa what she’d do differently, she paused for a long time. “I don’t know that I’d do anything differently,” she said. “I filed on time, I filed correctly, I didn’t do anything wrong. The lesson isn’t really about what I should have done. It’s that you can do everything right and still get stuck.”
She repaid her friend the $1,200 the same day the deposit landed. She put $500 back into her savings account and used the remainder to cover accumulated costs — groceries she’d deferred, a car maintenance bill she’d pushed back twice, and Marcus’s spring textbooks.
That line — “I’m back at zero” — stayed with me after our conversation ended. Theresa’s situation isn’t unusual. According to IRS Statistics of Income data, tens of millions of Americans receive refunds each year, and a meaningful share of those filers treat the refund as a planning tool rather than a windfall — structuring their entire first quarter around its expected arrival.
What makes Theresa’s story stand out isn’t the dollar amount or the length of the delay. It’s the compounding weight of each setback: the lost stipend, the sibling’s tuition, the frozen savings, the borrowed money. Each element on its own is manageable. Together, they form a kind of financial gridlock that no single refund check can fully unlock.
She told me, just before we wrapped up, that she’d started looking into whether her district offered any new supplemental programs for the coming year. She hadn’t given up. But she was clear-eyed about where things stood. “I’m trying to stay positive,” she said. “Some days that’s easier than others.”
I left the coffee shop with her words sitting uncomfortably in my notebook. Theresa Fulton did everything the system asks of a taxpayer. She filed early, filed accurately, and waited. The refund came. But the cost of waiting — in borrowed money, depleted savings, and postponed plans — wasn’t refunded along with it.
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