For many Americans, tax refund season is basically a fifth season: Winter, Spring, Summer, Fall, and “Where’s My Refund?” This year, that last one might drag on a little longer — especially if you live in a handful of states that are still untangling new federal tax changes, budget cuts, or full-blown political standoffs.
President Trump’s latest tax and spending package added new breaks for 2025 — including no federal tax on tips and overtime, an extra senior deduction, and a new auto loan interest deduction. Because of the “big, beautiful” changes, states now have to decide whether to follow those federal changes, ignore them, or partially adopt them. That means rewriting forms, reprogramming software, and retraining staff — in the middle of tax season.
Here’s where things are getting messy.
Idaho
If you’re in Idaho, patience might not just be a virtue — it might be mandatory. State officials warned that budget cuts reduced the temporary workforce that typically helps process returns. That alone could slow tax processing by 12 to 24 weeks, with refunds delayed up to six weeks. Adding to the chaos: Idaho didn’t finalize its conformity with the new federal tax law until mid-February — after the IRS season had already opened and more than 150,000 residents had filed. Updating forms and systems usually takes months. This year, they’re doing it on the fly.
Michigan
Michigan isn’t dealing with a political standoff or a software meltdown. It’s dealing with volume. The state has already processed more than 1.1 million returns this season — about 45% more than this time last year — and issued roughly $565 million in refunds. High volume plus a modernized processing system with extra accuracy checks can equal … delays. The Michigan Department of Treasury says most refunds should still arrive within four to six weeks. Still, some taxpayers report being stuck in “pending manual review” for weeks at a time.
New York
New York’s issue is rooted in software. A TurboTax glitch earlier in the season reportedly prevented some returns from being filed properly, which in turn delayed refunds. While the issue was expected to be fixed, some filers say the hiccup created a backlog. Nothing says “tax season” like refreshing your bank app because of a software bug.
Oregon
If you filed a paper return in Oregon, buckle up. The state said it wouldn’t even begin processing paper returns until late in the season, with the first refunds not going out until early April. Part of the delay stems from waiting on federal forms and information needed to update state systems. There was also a form issue tied to the Oregon Kids Credit that could require adjustments for some taxpayers — especially those also claiming new federal deductions.
If corrections are needed, refunds don’t move faster. They move slower. Like, a lot slower.
South Carolina
South Carolina decided not to conform to the new federal tax law. That means if you deducted things like tips, overtime, the additional senior deduction, or auto loan interest on your federal return, you may have to “add back” that income on your state return. Oh, and if you missed it, you could be filing an amended return. And amended returns are basically the slow lane of tax processing.
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Washington, D.C
Washington, D.C., is in a full-blown tax tug-of-war. The District originally voted not to conform to the new federal tax changes. Congress stepped in mid-season to reverse that decision, and President Trump signed it in February. D.C.’s attorney general is challenging whether that move was even valid. Electronic and paper tax forms have been delayed. Filing deadlines could potentially be pushed back. And roughly 60,000 residents who already filed may end up having to refile, depending on how the dispute plays out. Even the standard deduction is in limbo, with different dollar amounts depending on who ultimately wins the fight.
Now What?
Federal refunds are already down compared to last year, and state refunds are now navigating budget cuts, software glitches, late-breaking law changes and legal battles. If you’re counting on that deposit to fund a vacation, knock down a credit card balance, or just feel financially upright again, it might be wise to temper expectations. Tax season always tests patience. In these states, it may test it a little more than usual.
