The Delaware Division of Revenue disclosed Friday reports of several attempts to file fraudulent tax returns using stolen identities during the 2014 tax season.
In a related announcement a maker of tax software indicated it will halt access to its state tax software until the problems are resolved. Filing was quickly resumed after the company reviewed the system.
Parent company Intuit was under pressure to resume filings, since many people getting large refunds file their taxes in February after receiving various forms in January.
The problems could trigger delays in obtaining refunds as the division works to detect possible fraud cases, the state revenue chief warned.
The fraudulent filing attempts have originated from data that was compromised through a third-party commercial tax-preparation software database, according to a state release. The type of software was not disclosed.
Revenue division chief Patrick Carter said all information in Delaware’s tax database remains secure and at no point was Delaware’s online filing system compromised.
So far, 19 states – including Delaware – have reported receiving fraudulent filing attempts through the same third-party software.
Delaware is also flagging a number of returns as “potentially fraudulent” based on criteria found on the fraudulent returns. Any Delaware taxpayer who filed state income tax returns electronically for 2014 or years prior through a third-party software may be affected.
The Division of Revenue is working to identify victims and will alert them individually of any potential fraud and/ or identity theft.
“Protecting the personal information of Delaware taxpayers is our greatest priority right now,” Carter said. “As soon as our internal controls alerted us to the increase in fraudulent attempts, we implemented a number of safeguards to lessen any potential fraud from these return filings. We are confident that we are taking all necessary steps to ensure the safety of our taxpayers.”
Due to the safeguards, some taxpayers may experience a delay in receiving their State of Delaware refund. The Division of Revenue is working to ensure all taxpayers receive their proper refund as promptly as possible, said Carter.
Members of the public who believe they have been victims of Delaware Income Tax fraud or who have questions about suspicious activity are urged to call 302-577-8200. Taxpayers may also verify the current status of their state income tax return by going to http://revenue.delaware.gov.
I did not use any software package to file my taxes. I used the paper forms and mailed everything in. I still have not received my refund. Next year I’ll make sure I owe the state rather than overpaying. At least that way the money will be in my account for my immediate use. Wonder if I will get my return before my property taxes are due. Wonder if I can have the state deduct my property tax from what they owe me. Somehow I doubt it. Another one way street.