New York State website headline:
“May 31, 2017 Albany, NY — Governor Cuomo Announces Tax Department Stopped More Than 330,000 Suspicious Refund Claims”
In 2018 the New York State Department of Taxation and Finance refused to send my mother her 2017 income tax refund, and instead demanded “additional information.” The questionable circumstances surrounding their refusal may be symptomatic of a larger issue affecting New York’s vulnerable elderly taxpayers.
At the age of 94, my mother, receiving a municipal pension plan and Social Security, and taking a standard deduction, seems an unlikely candidate for a tax refund scammer. Her Federal and New York State tax forms had reported incomes from these same sources for the last ten years, and TurboTax’s “Audit Risk Meter” had remained at the very bottom of the risk scale all that time.
Nevertheless, New York State found her tax return “suspicious,” so I filled out the supplied form and sent it, along with the required copies of additional information, by Certified Mail. The refund check arrived in June of that year.
In 2019 the New York State Department of Taxation and Finance refused to send my mother her 2018 income tax refund, and again demanded “additional information,” even though all the income was from the same sources and virtually identical to the return from year before that had been subsequently approved.
I filled out the new form and sent it, along with the required copies of additional information, by Certified Mail.
In a space provided on the form, I requested the reason for their refusal and the need for the additional forms and paperwork.
The refund check arrived in June of this year. No explanation for their repeated refusals has been received.
When I first told her that we needed to send another form and more tax documents to Albany to try to get her a refund, my mother responded: “Don’t bother.”
Could the explanation be simply that by creating difficulties and barriers to the claiming of legitimate tax refunds, some taxpayers would be unwilling or unable to collect them?
And if their programming refused my mother a refund on the basis of her return, wouldn’t many other elderly taxpayers on fixed incomes be selected for the same treatment?
As mentioned in the introduction to this series:
In each blog, I will focus on an actual incident or issue that raises questions about the conduct of those who have been entrusted with the welfare of the public at large.
The questions and facts of the case will be included in a letter sent to the persons responsible for regulatory oversight, as well as to our elected representatives. The body of the letter will be disclosed in each blog, and the results of these letters and the names of recipients will be posted as updates.
At the end of the series, I will summarize the findings as to whether the response of Tompkins County public officials has been consistent with their duty to protect the public at large.
Below is the body of the letter:
I am writing to request that you look into the New York State Department of Taxation and Finance’s policy for stopping “Suspicious Refund Claims.”
I believe that the tax refund claims of New York’s vulnerable elderly are being stopped without proper reason by the New York State Department of Taxation and Finance, and in a manner that unfairly persuades the elderly to relinquish these claims to the benefit of said taxing authority.
New York State website headline:
“May 31, 2017 Albany, NY — Governor Cuomo Announces Tax Department Stopped More Than 330,000 Suspicious Refund Claims”
“The system’s predictive analytics and rules sift billions of data points to determine when to process a refund request or return and when it requires greater scrutiny.”
New York State Acting Commissioner of Taxation and Finance Nonie Manion said, “Our award-winning analytics system allows us to review each of the 10 million personal income tax returns as we receive them to stop suspicious returns and efficiently process the rest.”
Since the programming used by Taxation and Finance will select all similar returns and stop the refunds, the following example will be sufficient to extrapolate a serious problem in their methodology.
In 2018 the New York State Department of Taxation and Finance refused to send my mother her 2017 income tax refund, and instead demanded “additional information.”
At the age of 94, my mother, receiving a municipal pension plan and Social Security, and taking a standard deduction, seems an unlikely candidate for a tax refund scammer. Her Federal and New York State tax forms had reported incomes from these same sources for the last ten years, and TurboTax’s “Audit Risk Meter” had remained at the very bottom of the risk scale all that time.
Nevertheless, New York State found her tax return “suspicious,” so I filled out the supplied form and sent it, along with the required copies of additional information, by Certified Mail. The refund check arrived in June of that year.
In 2019 the New York State Department of Taxation and Finance refused to send my mother her 2018 income tax refund, and again demanded “additional information,” even though all the income was from the same sources and virtually identical to the return from year before that had been subsequently approved.
In a space provided on the form, I requested the reason for their refusal and the need for the additional forms and paperwork.
The refund check arrived in June of this year. No explanation for their repeated refusals has been received.
When I first told her that we needed to send another form and more tax documents to Albany to try to get her a refund, my mother responded: “Don’t bother.”
Could the explanation be simply that by creating difficulties and barriers to the claiming of legitimate tax refunds, some taxpayers would be unwilling or unable to collect them?
And if their programming refused my mother a refund on the basis of her return, wouldn’t many other elderly taxpayers on fixed incomes be selected for the same treatment?
In addition, the Department of Taxation and Finance only allows two avenues for questioning its decision: Visit their website or call them at 518-485-6808.
Visiting their website is not a real option for many elderly, who have no experience with computers or access to the internet. The phone number given is a toll number and would require a daytime long distance call for the majority of elderly using a land-line telephone. When I called this number on a land-line, I was informed there was an estimated wait time of more than 20 minutes before I could even speak with anyone — I hung up immediately and was charged $1.26.
With their imposition of extra forms and paperwork, and the difficulty and expense in questioning or clarifying the Department of Taxation and Finance’s decisions, it’s a policy that would scare off many fixed income elderly residents who are already living lives of complication and apprehension.
How many legitimate tax refunds have been wrongfully retained by New York State through the creation of barriers that are difficult for the elderly to overcome? It doesn’t require an “award-winning analytics system” to predict — quite a few.
This abuse will continue as long as it remains unchecked.
Please let me know what you are doing to correct this situation.