What Refund Usually Comes First, State or Federal?

When you file your tax returns, one of the most common questions is whether your state or federal refund will arrive first. The answer, surprisingly, is there is no rule, and the timing often varies by state and year.

While both returns are often submitted simultaneously through e-filing software, the processing of the federal return by the IRS and the state return by the state's Department of Revenue are completely independent processes. They operate on different systems, with different priorities and security measures.

The Federal Timeline Standard

The Internal Revenue Service (IRS) generally processes most electronically filed federal returns with direct deposit within 21 calendar days of acceptance. This has become a baseline expectation for many taxpayers. The IRS provides the "Where's My Refund?" tool, which updates daily, offering a predictable tracking mechanism.

However, even the federal refund can be delayed if:

• You claim the Earned Income Tax Credit (EITC) or Additional Child Tax Credit (ACTC), as the IRS is legally required to hold these refunds until at least mid-February for fraud prevention.
• Your return is flagged for errors, fraud review, or requires manual processing.

State Processing: A Case-by-Case Basis

State refund processing times are far less standardized than the federal government's:

• Some States Are Faster: Many taxpayers in states with highly efficient or recently modernized systems, such as some in the South or Midwest, report receiving their state refund a full week or two before the federal refund.
• Other States Take Longer: States with complex tax laws, high volumes of returns, or heightened anti-fraud protocols—like New York or California—often take longer than the IRS. State processing can range from a few days to over a month.

In almost all cases, the state cannot begin processing your return until your federal return has been officially accepted by the IRS. A rejection of your federal return will prevent the state from even starting its review.

The Bottom Line

You might receive your federal refund first, or you might receive your state refund first. Since both agencies use different security protocols and have different staffing levels, there is no way to predict which check will clear first.

To get your money as quickly as possible, always:

1. E-File (Electronic Filing).
2. Choose Direct Deposit.
3. Ensure your return is error-free to avoid manual review delays.

Unsure which refund you can realistically expect first—or why one is lagging behind the other? Watter CPA can review your federal and state filings, check the status, and help you plan around the actual payout dates. Reach out to us today for 360-degree expert assistance.

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