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I.O.Utah: Taxpayers get explanation after receiving erroneous tax notices

The Utah Tax Commission says a computer glitch is responsible for thousands of erroneous notices sent to taxpayers, many demanding payment of past due interest, fees. Photo: Deseret News

Thousands of Utah taxpayers received notices by mail that they owed up to thousands of dollars in tax penalties and interest.

Turns out, that was not the case and now state tax officials say they know what happened.  The Utah State Tax Commission blames a computer error triggered by this year’s extended filing deadline.

Erroneous tax notices sent to thousands

The bogus notices went out to about 13,000 of the roughly 1.5 million Utahns who submitted income tax returns for the year 2019.

Officials say the tax commission’s computer system had trouble adjusting to this year’s changing deadline.  The erroneous tax notices went out to some taxpayers who filed and paid their taxes between the usual deadline of April 15 and July 15, the adjusted deadline.

Mike Lee, the commission’s taxpayer services division director, says the system had a difficult time adjusting to this year’s deadline.  This year, the legislature voted to push the normal tax deadline back to July 15; people who paid the amount due by that date had until mid-October to file their returns.

Last minute filers more likely to receive mistaken notice

Lee says some taxpayers who submitted their returns last minute wound up flagged incorrectly in the system as late, and received erroneous notices. He says they got the faulty notices even though the system was tested ahead of time.

The tax commission had already received some 2019 returns by the time the Utah legislature changed the due date, leaving state officials with fewer options to accommodate the change, according to a commission news release.

As soon as they detected the problem, the tax commission and state officials agreed to correct the problem and return money to taxpayers who paid penalties in error.

The system is currently up to date and reflects the correct amounts due by Utah taxpayers, says Lee, and the commission hasn’t mailed any bogus notices since Nov. 13.

State tax officials say corrected tax notices should land in mailboxes by Dec. 15.