Find out why it's more important than ever to file your taxes early this year.
If it takes a little longer than normal for you to get your state tax refund this year, blame the crooks trying to steal taxpayers’ refunds.
The Internal Revenue Service, states and tax preparers are implementing extra security measures in an effort to thwart thieves who are trying to get their hands on your refund money.
Tax return fraud is a massive and costly problem in the United States. The IRS reported that it found 163,087 tax returns with more than $908.3 million fraudulently claimed refunds in 2015. The agency said it prevented the issuance of roughly $787 million (86.6 percent) of those refunds.
Tax return fraud occurs when a third party uses stolen data to file a tax return and receive a refund. Unfortunately, the victim often doesn’t know about the fraud until their return is rejected because their tax information has already run through the system.
The implementation of additional security measures has prompted many states, including North Dakota, to warn residents that their state tax returns may take longer to process.
“We ask that taxpayers be patient when waiting for their refunds,” North Dakota Tax Commissioner Ryan Rauschenberger said in a statement. “A slightly longer processing time is actually a good thing. We are taking the time to prevent North Dakota tax dollars from getting into the hands of fraudsters.”
Some states have notified taxpayers that their tax refunds won’t be issued until after March 1, no matter how early they file a return, according to The New York Times.
The Illinois Department of Revenue recently announced that individual tax refunds won’t be issued until mid-March, at the earliest. Hawaii’s Department of Taxation said new preventive safeguards could delay some taxpayer refunds by up to 16 weeks, the Times added.
Filing your tax refund as early as possible is one of the best ways to protect yourself from tax return fraud. Patience also seems to be a good suggestion this tax season. Check out more tips on how you can protect your tax refund from thieves. You don’t want to end up like the Atlanta woman who had her tax return stolen two years in a row.
Click here for more information on avoiding tax scams.
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