State tax refund delays possible in New York, Oregon, Idaho, South Carolina, and Washington, D.C., in 2026

Refund timing varies by jurisdiction as policy changes, staffing constraints, and filing methods slow processing

Some taxpayers in four states—New York, Oregon, Idaho, and South Carolina—as well as Washington, D.C., may face slower-than-usual timelines for receiving state income tax refunds during the 2026 filing season. The causes differ by jurisdiction, but the common thread is administrative disruption tied to policy changes, technology updates, and processing capacity.

In Washington, D.C., refund timing is affected by an ongoing dispute over whether the District’s tax code should conform to federal changes enacted in 2025. The conflict centers on competing positions over the legality and timing of congressional action reversing the District’s earlier decision not to conform. District officials have warned that prolonged uncertainty can create operational strain for tax administration, including the possibility of altered filing deadlines if the matter remains unresolved.

What is driving delays in each state

• New York: Some early filers experienced returns remaining in a “processing” status after using third-party tax software that required updates related to the state’s inflation refund checks. New York authorized one-time inflation refund checks in the 2025–2026 state budget, and the state has indicated these payments are issued separately as mailed checks. Taxpayers affected by software-related filing issues may need to confirm they are using updated versions and accurate state reporting where required.

• Oregon: Oregon has reported that paper-filed personal income tax returns for the 2026 season cannot be processed until late March 2026, with refunds for paper returns not expected to begin issuing until early April. The state has cited delayed federal tax-form information as a key reason for the late start for paper processing, while encouraging electronic filing to reduce bottlenecks.

• Idaho: Idaho tax administrators have warned that budget-driven staffing reductions could extend processing timelines significantly. State fiscal officials have discussed scenarios in which refund and payment processing could be pushed back by multiple weeks, and the state has also managed timing complications tied to decisions on conformity legislation related to federal changes.

• South Carolina: South Carolina’s refund timing is being complicated by the state’s nonconformity with certain new federal deductions. Because many state returns begin with federal taxable income, taxpayers who claim federal deductions that South Carolina does not recognize may need to add back those amounts on the state return. Manual adjustments and corrections can slow processing and delay refunds.

What taxpayers can do to reduce the risk of delays

Tax agencies generally process electronic returns faster than paper filings, and errors or missing information can trigger additional review. Taxpayers can take several steps to minimize delays:

• File electronically when possible and choose direct deposit if available.

• Confirm tax software is fully updated before submitting returns, particularly in states reporting software-related issues.

• Review state-specific guidance on add-backs or nonconformity adjustments when federal rules differ from state rules.

• Respond promptly to any verification or documentation requests, which can pause refund issuance until resolved.

Refund delays can stem from policy uncertainty, filing method backlogs, or returns requiring additional review—factors that can vary sharply by state and by taxpayer.

Taxpayers in the affected jurisdictions who are expecting refunds may want to monitor official state refund-status tools and retain documentation supporting items that commonly require verification, including identity checks, income statements, and claimed credits or deductions.