Budget cuts slow tax refunds for paper returns

DES MOINES – State budget cuts are to blame for delays in processing tax refunds for Iowans who filed their 2009 returns the old-fashioned way by mailing in a paper form, officials with the state Department of Revenue said Friday.

Stuart Vos, the department's revenue operations division administrator, said his agency is running behind in processing state refunds this year because state budget cuts wiped out the agency's ability to hire temporary help to deal with the influx of returns during the last two weeks of April.

A decade ago, the department would hire up to 100 temporary workers but in recent years that number shrunk to 50, he said. This year the number shrunk to zero and agency employees are being shuffled to help out with processing returns, he said.

“Pretty much everybody in the agency has been affected, either by being taken off their regular job to open mail and to do data entry or to cover for somebody who's doing that. It's been a real effort for us and it has certainly delayed the processing from where we would have expected it to be,” Vos said. “Even I've been opening mail.”

For the current tax season, state revenue officials have received about 1.35 million personal income tax returns, a figure that is down about 4 percent from last year. So far, about 83 percent of the Iowa returns have been filed electronically but Vos estimated the final count will be about 75 percent because most of the returns arriving since the April 30 filing deadline have been paper forms.

To date, state officials have processed 803,719 refunds total $416.2 million or an average of $517.85 being returned to taxpayers who reported having more money withheld from their paychecks than what their tax liabilities turned out to be. The average refund is about $4 higher than last year with the state had refunded $421.8 million to 821,998 individual taxpayers by this time, he said.

Total refunds processed through individual income tax returns this year are expected to total about $614.6 million by the end of June, Vos said.

“We're working hard to get as many out as we possibly can but at this point it's just impossible with the staff we've got to get everything done,” he said.

“We're at the point now where we're kind of over the hump and we hope to have all of the refunds issued by the end of June,” he added. “If you file electronically, you're going to get your refund within a week or two weeks at the latest. For those people who filed on paper for a refund, don't expect to receive your refund until mid to late June at the best.”

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