In the news:
Software glitch delays 660,000 tax refunds
The Internal Revenue Service says refunds for 660,000 taxpayers who claimed education-tax credits will be delayed by up to six weeks because of a problem with the software they used to file their tax returns.
The Associated Press
WASHINGTON — The Internal Revenue Service (IRS) says refunds for 660,000 taxpayers will be delayed by up to six weeks because of a problem with the software they used to file their tax returns.
The delay affects people claiming education-tax credits who filed returns between Feb. 14 and Feb. 22.
H&R Block, the tax-preparing giant, says that some of its customers were affected but the company has resolved the problem. A limited number of other software companies have also had problems, but IRS spokeswoman Michelle Eldridge declined to name them.
Turbo Tax customers were not affected, spokeswoman Julie Miller said.
The IRS expects to process about 150 million tax returns from individuals, so less than 1 percent will be affected. About 6.6 million taxpayers are expected to claim the education-tax credits.
The software problem was on Form 8863, which is used to claim the American Opportunity credit, which provides up to $2,500 to help pay for college expenses, and the Lifetime Learning credit, which provides up to $2,000.
The form includes a series of questions. On some of the questions, if the taxpayer answered “no,” the answer was left blank when the form was electronically transmitted to the IRS.
H&R Block said the forms were filled out correctly but the answers were dropped when the forms were transmitted to the IRS.
“It’s important to note that the tax returns were prepared accurately. The error occurred in e-file processing,” H&R Block said in a statement. “We are communicating directly with our impacted clients to assure them that we are doing everything we can to expedite their returns.”
The IRS has long had a goal of increasing the number of people who file their tax returns electronically. The agency promises faster refunds for people who file electronically and have their refunds deposited directly into bank accounts.