TurboTax and the Oregon kicker, Day 4
The exchanges between the makers of TurboTax tax return preparation software and Oregon taxpayers who say that that program improperly donated their state income tax "kicker" refund to the State School Fund have reached an apparent impasse. We blogged about the brouhaha here and here, and today we have just a little more to add.
TurboTax says it can't see how the software could have checked the "Donate Kicker" box on the tax return unless the taxpayer checked that box in one of three places: in the "Interview" conducted by the program, on the "Information Worksheet" that the taxpayer can use instead of the "Interview," or on the tax return form as it appears on the screen.
But several readers of this blog disagree. One wrote:
This return was prepared using TurboTax Deluxe, the store bought version. After completing taxes, I created a PDF from the software and printed paper forms from the PDF. Filed paper copies by US mail and did not receive kicker check. I did not notice that "Donate Kicker" box had an X in it before mailing forms. I had NOT put an X in that box when I was working in the software, so I assumed my kicker was not being donated.The fact that this taxpayer filed on paper and now complains about the problem is interesting. The official Oregon Department of Revenue statement about the situation makes it sound as though the issue is limited to those who filed electronically, as opposed to using software but filing a hard copy:
If you e-filed your 2006 tax return and believe your kicker refund was donated to the State School Fund in error because you didn’t check the box to donate your refund, please know that this issue is our highest priority.Has the DOR somehow determined that hard copy filers could not possibly have a valid complaint?
The DOR notice also asks taxpayers to report "whether you used the online or store-bought version." With TurboTax, as I recall, even if you buy the software on a CD, only the federal return is included -- the software relating to state taxes must be downloaded from a TurboTax website over the internet. One state typically comes free with the federal product, but it's not actually in the box.
In any event, today's bottom line is that this incident has boiled down to a he said-it said over what particular taxpayers actually did while running TurboTax. One reader writes:
Jack did not show that people who did not check the box on the information worksheet had the box checked on the paper PDF with the barcode. But I can show that is exactly what occurred to the return my wife prepared using Turbo Tax. And no, we haven't changed anything. And yes, we e-filed. And yes, it was early -- which gets back to my prior point that there was an update at some point that corrected the glitch.Not a very touchy-feely statement.
If we donated it voluntarily (which we did not) or through our own error (which we did not), I can accept that. That is not the case, however, and there will be some kind of resolution one way or the other whether it comes from the state or from Turbo Tax/Intuit.
Just to add some more fuel to this fire, an alert reader who didn't have a problem volunteered to reinstall TurboTax 2006 fresh on his Mac and see what the default setting on the "Donate kicker" box was. He reports:
Attached is a screen grab from a virgin copy of Turbo Tax '06 for the Mac. I did nothing more than open up the copy, which imported my name and other information from my Federal TT '06 return. The screen grab is of the portion of the information sheet showing clearly the box with the kicker refund question on it. Note that the question is present and the box is unchecked, the default condition. I don't have the Windows version to compare, but clearly there is no problem with the Mac version.Here's his screenshot, with the crucial box at the botom:
What he didn't do -- and if he's reading, I hope he'll do it today -- is go to that "virgin" TurboTax, with that box unchecked, open up Form 40, and show us what the top block of that form looks like on the screen. Finally, print out the form and see what's on the printed version.
At least one commenter suggests that everyone who is complaining either (a) made an operator error or (b) consciously donated the kicker and is now forgetting that fact or lying about it. It's hard for me to accept those explanations. At this stage, there are reportedly more than 3,000 people complaining that TurboTax or other software ate their kicker check. That's a lot of people with bad computer skills, bad memories, or bad enough morals to risk going to jail over a few hundred bucks.
UPDATE, 12/20, 8:16 p.m.: Big news! Here.