MA DOR Issues Refunds While Enhancing Taxpayer Verification Efforts to Combat Fraud

Some taxpayers being asked to verify refund information resulting in delays

(Boston, MA)- Commissioner Amy Pitter today announced that efforts have been intensified to authenticate the legitimacy of tax returns resulting in refunds. “We already had robust filters in place and we are adding to our arsenal in an effort to combat ever-increasing fraud attempts,” said the Commissioner.

Earlier this month, the Department of Revenue (DOR), like many state revenue agencies across the country, temporarily stopped issuing refunds following reports of possible widespread tax refund fraud. Refunds were resumed within several days and more than 440,000 refunds have been issued since, with approximately 5% of returns with refunds being set aside for additional taxpayer verification.

In response to the recent reported fraud concerns, DOR began developing an online application designed to collect information from taxpayers whose refunds have been set aside for additional scrutiny. These taxpayers will be notified by mail with instructions for completing a secure, online verification process with specific information related to their refund. It is anticipated that this application will be ready before March 15. Due to the inventory of refunds that were recently set aside, there will be a one-time release of notices this week to approximately 15,000 impacted taxpayers asking them to call and speak with a DOR representative to provide information that will allow their refund to be released.

Until the new online refund verification application is available in the next couple of weeks, any additional refunds set aside for further scrutiny will be held. Although only a small percentage of taxpayers due refunds will be included in the verification process, it could mean that up to 20,000 taxpayers will experience a delay in receiving their refund. When the new online application is launched, notices will be sent to affected taxpayers with instructions for completing the refund verification.

Since last fall, some taxpayers have been notified by mail to take a secure online quiz answering personal information only they would know to confirm their identity. Once that quiz is passed, their refund is issued. This is a separate procedure for a different group of taxpayers and this process will continue. So far, more than 16,000 taxpayers have been notified to take the quiz, and once the quiz is passed, refunds are issued.

“This new fraud test means that some taxpayers will wait a little longer for their refunds as we determine that the legitimate taxpayer actually filed the return. It is essential that we protect taxpayers and the Commonwealth, and although it will result in a delay for some, we think it is well worth the extra effort,” said the Commissioner.

Taxpayers may check the status of their refund at any time online using the Where’s my Refund app at www.mass.gov/dor or through the automated phone system at 617-887-6367 (or toll-free in Massachusetts at 800-392-6089).