While the Internal Revenue Service has long been on high alert for fake tax filings, fraudulent returns now are a major concern for state tax departments.
And that's posing problems for folks who are untouched by tax identity theft.
Many refunds are being slowed as state officials take added fraud precautions. Some state tax refunds are not being issued in the form taxpayers expect.
Beyond TurboTax: Earlier this month, the country's leading tax software program TurboTax temporarily halted e-filing of state returns when more than two dozen states reported indications of possible tax fraud in connection with some of those returns.
That delayed filing by the software company was just around 24 hours.
Many state tax departments, however, are taking some more time with all filings to ensure that they are legitimate. That means the right refunds to the right taxpayers will be delayed.
Rhode Island issues: Rhode Island Division of Taxation officials say that the added anti-fraud safeguards mean that it could take up to five additional business days for e-filing taxpayers to get their refunds. Previously, the refund were issued in 10 to 15 business days.
Rhode Islanders who filed paper forms usually get their refunds in four to six weeks. Now they should expect that to take a week longer.
Louisiana taking longer: That's also happening in the Pelican State.
The Louisiana Department of Revenue says its extra precautions will push the day it will begin issuing refunds to the week of March 2. That's a week later than planned.
"Given the increase in the filing of fraudulent tax returns around the country, where criminals are stealing identities and claiming refunds in others' names, we decided to implement additional security measures this year to ensure we detect any suspicious activity, and to protect the identities of our taxpayers," Secretary of Revenue Tim Barfield told the Shreveport Times.
Utah finally issuing refunds: Utah residents, get ready. Your refunds are finally on the way. Beehive State tax officials had delayed the refund distributions after they found numerous attempts to file fraudulent returns.
But some Utah taxpayers won't be getting their refunds in the form they requested.
The Utah Tax Commission says while it will issue refunds to bank accounts and checks mailed directly to taxpayers, it is not loading refunds onto certain debit card accounts. Those plastic refunds are still on hold while the Commission reviews its processes to determine that the money is being sent to the correct taxpayers.
Colorado refunds literally in the mail: Colorado filers also are getting their refunds in a way other than what they expected.
Because of potential fraudulent activity, the Colorado Department of Revenue is sending some taxpayers their tax refunds as paper checks rather than direct deposits.
Those taxpayers won't get advance notice of the change. Instead, they'll get an explanation letter that will be in envelope with the paper refund check.
Have you noticed your state tax refund is taking longer to be issued? Has your state notified you of a fraud-related change in how it's dealing with refunds? Please let us know.
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