Delayed state tax refunds in Illinois, Louisiana & Utah because of tougher tax identity theft procedures
Wednesday, January 06, 2016
The 43 states that collect some type of income tax from their residents plan to follow the Internal Revenue Service schedule and start their 2016 tax-filing seasons on Jan. 19.
But when it comes to refunds associated with 2015 filings, the federal and some state calendars diverge dramatically.
The IRS, so far, is sticking with its hope prediction that it will issue more than 90 percent of refunds this year within at least 21 days after it receives the electronically filed returns.
Illinois, Louisiana and Utah officials, however, are saying not so fast. They have alerted their taxpayers that in some cases it could be months before they get their state tax refunds.
It will be a struggle for some filers to get their state tax refunds early this filing season.
The reason for the delays, according to the various state tax departments, is enhanced efforts to stop tax identity theft and associated fraudulent refund claims.
Illinois targets March deliveries: The Illinois Department of Revenue announced on Jan. 4 that it "does not anticipate releasing Individual Income Tax refunds for the 2016 tax filing season until March 1, 2016."
While the delay will distress those filers awaiting state tax refund money, Illinois officials say their efforts are paying off. Last year the Illinois tax office stopped nearly $5 million that criminals tried to claim by false filings.
"Our new security protocols proved very beneficial in detecting and stopping fraudulently filed returns last year, and we are continuing to enhance our fraud detection efforts this year," said Connie Beard, director of the Department of Revenue. "By delaying tax refunds by just a few weeks, we'll be able to better detect attempts at identity theft and ensure taxpayer refunds do not fall needlessly into the hands of criminals."
Illinois taxpayers can go ahead and get their filing task out of the. The tax department says that for returns that are e-filed before March 1, it expects to issue refunds within two to three weeks after that month's start date. If you file, again electronically, after March 1, state tax officials say you should get your refund within two to three weeks from the date your return was submitted.
Utah's mandated March 1 deadline: The Utah Tax Commission says that a new state law could push some of its return processing and associated tax refunds into March, too.
Since most tax crooks make off with fake refunds before the real taxpayer victims get a chance to file their returns, the state has implemented a stricter tax data matching system. Basically, the Tax Commission now must electronically compare a filer's income tax return with the employer's withholding reports.
To facilitate this matching, employers are required each year to electronically file their Utah annual withholding reconciliation forms and associated W-2 and 1099R forms by Jan. 31. If they don't, they'll face financial penalties.
But it's taxpayers who also could be penalized if employers are slow in meeting the deadline.
Even if you, the legitimate taxpayer, files a state tax return, the new law prohibits the Tax Commission from issuing you your refund before March 1 if your employer did not electronically file the business' related tax data by Jan. 31.
Louisiana expects 60-day delay: The situation is the same in Louisiana, where the Pelican State's tax department says that over the past two years, its anti-tax fraud efforts have saved taxpayers more than $38 million and led to the arrests of more than 50 individuals accused of tax ID theft related crimes.
Louisiana officials plan to keep that up in 2016.
The Department of Revenue's enhanced security measures mean it will take additional time, specifically up to 60 days, to process refunds this filing season. During that time, the state tax department says it will use "all available technology and resources" to thoroughly review suspicious tax returns.
The two-month delay applies to e-filed returns. Taxpayers who send in paper returns should expect to wait 12 to 14 weeks for their refunds.
More states to delay refunds? These three states could be the start of a trend that started in 2015 and is picking up steam this filing season.
Last year, several states halted tax return processing because of tax ID theft and refund fraud worries.
"We saw quite a bit of testing the [state refund delay] waters last year, and we know there are a number of states that are just waiting for a few others to go first," Verenda Smith of the Federation of Tax Administrators told Politico.
This year, in addition to the three states that have made official delayed refund announcements, Wisconsin reportedly has warned its taxpayers that refunds could be late because of fraud protections. The Badger State has not set any dates, saying instead it will examine suspicious returns on a case-by-case basis.
Adjust your state withholding: So, state taxpayers depending on a refund, budget accordingly even if you're not in Illinois, Louisiana or Utah. Filers nationwide could find their refunds arriving later than usual this year.
And if you typically use your federal and state refunds as forced savings accounts, you might want to rethink that strategy.
Tax fraud is not going away any time soon, meaning this trend of closer scrutiny at state and federal tax return processing levels also will continue for a while, like into future tax years. And that means that late-issued refunds will become the norm.
To avoid that situation, consider adjusting your payroll withholding so that you'll have that money in hand throughout the year, rather than waiting -- and waiting and waiting -- to get it back after you file the next year.
You also might find these items of interest:
Same here guys and same useless message as the above mentioned, more time needed. Did I mention it was file in April and it's now Mid September. And just like some of the other complaints mentioned, in the past 2 years they've always found some sort of mistake that allows them to keep a chunk of our refund. Yes, something stinks to high heavens in Louisiana. It's ridiculous, who do we go to? I promise, I am going to do all I can legally to keep them from extracting state taxes from my money. #disgustedwiththisbackwoodsplace
Posted by: Linda | Monday, September 12, 2016 at 05:28 PM
Filed On February 18th 2016. Still no refund as of June so I finally got through by phone to them. Of course they tell me they have no record and I had to resubmit. Now I guess it will be another 14-something weeks just to check on it.
Scam scam scam! I always knew there was something dishonest about that state!
Posted by: Captain Chris | Monday, August 01, 2016 at 05:24 PM
We filed in February and it's now July, and still have not received it
Posted by: Lynn Johnson | Tuesday, July 05, 2016 at 07:04 PM
It has been 90 days since we filed and still no refund. I'm getting a little more than aggravated.
Posted by: Leslie | Saturday, June 04, 2016 at 08:18 AM
We filed Jan 26, it's now may 30 still no state refund! This is bull crap!!!!
Posted by: Steven | Monday, May 30, 2016 at 12:14 PM
If anyone is planning a lawsuit,class action or whatever,I am very interested,as I had these same issue's this year,followed by the La dept of Rev altering my taxes,stating that there was a mistake and they corrected it.There was no mistake and I was shorted $250.00.At the beginning of me filing,I was told that Livingston Parish withheld $40.00 for a previous public defender fee I owed,No big deal to me,until,After they sayed I had a mistake on the return,after they corrected the mistake and redid my return,they don't know if Livingston got theres or not,so I may have a warrant.I know they are collecting interest off all of our money.I went to the main office in Baton Rouge to prove my Identity,the Supervisor gave me the wrong fax number to send all my info too,in which I had to pay office depot Twice,to have it faxed,once to wrong number she gave,then once to the correct number.I am very frustrated my return came back 250.00 short.Wheres the money I earned.225-304-1090 call or text if there is a lawsuit,please.
Posted by: Robert Chess | Monday, May 23, 2016 at 05:56 AM
I paid my delinquent taxes in full but LDR put a hold on my LDR and IRS refunds on later claims waiting for paperwork to prove I paid my delinquent taxes. I had to call them to send me my refunds which they waited on doing only after asking them to do so. It took six months to finally release my Louisiana refund and neglected my IRS refund so now I'm having to do everything again for the IRS refund which will be forever again when they should have released it with my state refund. I had to call them on their line for requesting a release letter to get your licenses back which wasn't listed on their web site as the number to take care trying to reclaim what they owe you. I couldn't find anything published on the matter of how to go about it except the worthless number to check on your refund status which is automated to let you know about your current refund which doesn't tell anything till well after get a refund.
Posted by: Timothy Trahan | Saturday, May 14, 2016 at 10:18 PM
Filed in Mississippi on February 5th. Today is May 12 and I still do not have my refund either.
Posted by: Tammy | Thursday, May 12, 2016 at 09:17 AM
There is no 60 days waiting for me to pay my taxes. It is taken out every time i get paid.. We have too wait for them to review it. What is the purpose of efiling? I dont mind paying my taxes but dont have me wait for it.... Because i know that the politicans got there refund on time... I filed Feburary 4,2016...
Posted by: Gary A. | Friday, May 06, 2016 at 03:20 PM
This is truly ridiculous i file feb 12, 2016 here is is MAY2 WEll pass 60days and i still haven't received my state are a letter asking for information Louisiana needs to get it together
Posted by: alethia | Monday, May 02, 2016 at 07:07 PM
Yep it is the same thing with me filed 2/2/2016 and it was excepted on 2/3/2016. Still no Louisiana State refund. Called several times and emailed no one cares to answer me. Just your return was received and not processed. We should all just file exempt from LA State tax and pay them the when we feel like paying them back due to fraud with the LA Gov system. This is just unbelievable that we have to wait this long to get our money that we worked for all year long.
Posted by: Louisiana Tax payor | Wednesday, April 27, 2016 at 11:05 AM
I have filed jan 29 2016 I have recieved my federal taxes in two weeks from that date and here its now the end of april and still have yet to recieve my louisiana state frefund. It has been put under review when money is owe to them they take it the next day, But here it is i can get any answers to my questions about my money i work hard for. My family member filed self employed and recieved both federal and state and havnt work the year of 2015. Very ridiculous and fustrating!!
Posted by: Valeria | Monday, April 25, 2016 at 11:12 AM
Filed in ark and la due to job location received ark tax 2 weeks federal in 3 filed Feb 13 and still nothing from LA. I did not get to keep it out of my check for 60 plus days before they took it
Posted by: Toby | Thursday, April 21, 2016 at 05:25 AM
Allow me to convey just how back-asswards Louisiana state government handles our income taxes.
I filed my state taxes on 01-19-2016. Checked the "Wheres My Refund" link on their webpage regularly. The link finally stated that my original refund was changed and was direct deposited on 09-25-2015. That's right, FOUR MONTHS before I filed. That is the same message I got last year and the year before that.
I decided to email them from their email link on their web page. I sent this:
March 17, 2016
When I check my refund status it indicates it was direct deposited 4 months
before I submitted my return. No other information is given. I get this similar
message every year. How can this be?
Their auto-reply states that I will receive an answer within 48 hours.
Six days later they replied with this useless information and did not address even one part of the question I asked:
March 23, 2016
Thank you for contacting the Louisiana Department of Revenue. In response to
your email, our records reflect that your 2015 individual income tax return was
received January 19, 2016. Your return has been selected for review. Our system
reviews each income tax return prior to issuing a refund. This review detects
errors and /or credits claimed which require appropriate documentation.
Even though, the goal of the department is to complete the review process within
an estimated 90 days from the date of your return, it can take longer. The
review of your return has not been completed and there is no action required on
your part at this time. If additional documentation is needed, you will be
notified by mail. Please allow more time for the review of your return. We
apologize for the inconvenience.
If you have further questions, please give us a call at 855-307-3893.
Ms. Jessica Pleasant
Revenue Tax Analyst 1
LDR Contact Center
Fax number: 225-231-6243
How Am I Doing? You may respond to CCFeedback@la.gov.
Now you can draw your own conclusions from the above information but, I believe that because Louisiana is so far in the red financially that you can bet LaGov will hang on to our money indefinitely unless we band together and do something about it.
I am in a position to file a lawsuit against Louisiana for withholding my money without a court order or any state lien on any property I own. Rest assured, I AM going to stir the *hit
and get these state government crooks to release taxpayers money.
Posted by: John | Monday, April 04, 2016 at 04:12 PM
He'll try living in backward ass alabama. The same thing. La, al , ga, the bottom of the boot confederacy. I file at the beginning of Feb, received my tax return but, the state website keeps showing " still processing" . Dam right we should be paid interest. ITS MY MONEY AND I NEED IT NOW...!!!!!!
Posted by: Jay | Saturday, April 02, 2016 at 09:34 AM