My NY state tax return was rejected because of the company who filed it. Now what?

April 27, 2008 6:38 PM

I think that the online tax service I used has messed up the New York State taxes for *anyone* who filed from New York City or Yonkers. Now what do I do? (sorry, long)

I paid my federal taxes with free file, using one of the tax services linked from the IRS' page. Of course, I was too lazy to mail in my New York State return (IT-201), so I paid the company $12 to file it. A few days after submitting the return, their site said that it was rejected. There was no error code indicating what I should fix, and everything looked fine, so I just resubmitted. A week later, I checked back and saw that it was rejected again, with an error code of 0130. According to the NY State website, this means that the local taxes on my W-2 form did not match those on my IT-201.

So, I went over their online IT-201, and sure enough, there was no place to enter any information about local taxes (NYC and Yonkers are the only parts of the state that pay local taxes). I emailed the company to point out that their service would cause all state tax returns filed from NYC and Yonkers to be rejected, and their response was, "We were not able to support certain parts of some forms this season." So, of course, they offered me my $12 back. At which point, my head exploded.

Okay, seriously, am I insane? Is this not a big deal? Shouldn't it be on the news or something? It seems to me that this will fuck over at least a few other people.

1. I called the NY State tax office, and the woman actually got really panicky, but told me to call the IRS and the Better Business Bureau.
2. I called the IRS, but they didn't care because it is a state thing. I pointed out that they were verifying the accuracy of the company's services by listing it on their site, and they directed me to complain to the company who approves the free file businesses. That company wants a really complicated complaint, which I will do, except that it seems kind of small potatoes.
3. I have not yet called the BBB, because surely SURELY this is a huge deal and some government agency should deal with it.

Should I call the state tax people again? Or the BBB? Or what?

posted by unknowncommand to law & government (8 comments total)

Shouldn't it be on the news or something?

It won't be on the news if the news doesn't know about it. But it sounds like a good TV news story. Check your local news web sites for instructions on story submission. The Consumerist might also be interested in writing about it.

As for what else you should do: is this error causing you to owe extra taxes or penalties? If so, it sounds like you have a good case for getting the company to reimburse you for that. If not, what would you like to have happen?

You might also consider naming the offending company, so that when people Google it in the future, this page comes up.
posted by Dec One at 7:18 PM on April 27

I pointed out that they were verifying the accuracy of the company's services by listing it on their site, and they directed me to complain to the company who approves the free file businesses.

Although really they're just verifying the federal tax part of it.
posted by smackfu at 7:58 PM on April 27

3 words. Class Action Lawsuit.
posted by hal_c_on at 12:16 AM on April 28

TaxAct Online?
posted by I-baLL at 5:18 AM on April 28

Dec One, I just contacted a few newspapers, so we'll see what happens. The error doesn't cause me any penalties unless the state penalizes me for filing late. I haven't checked their policies on that. I want the company to contact everyone who filed to let them know that they have to refile, and to refund everyone's money. I know at least two other people, now, who have the same problem, and neither were contacted by the company. I worry that other people will be saddled with extra taxes that they weren't prepared to pay, and that's not fair.

smackfu, yeah, I know, the NY state tax woman was just really insistent that I call them. On the phone, I pointed out that if they weren't supporting "certain parts of some forms," that there was a chance that not all federal forms were being supported.

hal_c_on, I am not discounting the idea of a lawsuit, though I probably don't have the time/energy to deal with it, and it seems like no one really cares except for me!

I haven't put the name in the thread, because I didn't want it to be construed as some sort of irate customer overreacting and google-bombing them all over the internet. Too cautious perhaps...
posted by unknowncommand at 6:13 AM on April 28

Now that I think about it, it is pretty weird that the NY state tax office didn't seem to care. Presumably, in order to e-file tax returns, this company has an agreement with the state stipulating that they are able to e-file tax returns properly. You've reported to the state that this company is violating the agreement I assume it has, and the state comes back with the non sequitur that you should contact the IRS and the BBB. What do the IRS and the BBB have to do with anything? I would call the state back, don't mention that you found this company on the IRS web site, and ask if a company that e-files is supposed to be able to do so correctly.
posted by Dec One at 6:59 AM on April 28

unknowncommand: It is TaxAct, isn't it? Same thing is happening to me.
posted by I-baLL at 7:50 AM on April 28

Nope, not TaxAct. We can race to get the jerks to fix it, though, if you want!
posted by unknowncommand at 8:50 AM on April 28