February 3, 2017

New Vermont tax code to focus on fraud prevention

 MONTPELIER — Last week, the Vermont Department of Taxes and the IRS began accepting tax returns for the 2016 tax year. There are a few changes the department would like taxpayers to know about.

The department continues to experience a rise in attempted tax refund fraud, an alarming trend that mirrors what is happening in other states and at the federal level. State revenue departments and the IRS are implementing procedures to help protect the taxpayer’s money. Vermont taxpayers will be asked to provide a Vermont driver’s license or state-issued identification card number when filing. If the information is not provided and the department cannot verify your identity, this may delay the processing of a refund.

In limited circumstances, the department will require identity confirmation before sending a refund, and will send verification letters to the physical address listed on the tax return. This letter will provide instructions on how to verify return information to complete the processing of a refund. To complete this request, taxpayers will not be asked to enter a social security number. Submitting the requested information over the phone or at www.myVTax.vermont.gov will verify the refund request and allow the department to proceed with processing the refund.

“One of the most concerning frauds we see is the filing of false tax returns in order to generate a refund. We have controls in place to identify suspicious refund requests and in some cases the department will need to take additional steps to ensure that the refunds we issue are going to the right person. We ask that taxpayers work with us as we balance the goal of customer service, speedy refunds and fraud prevention. Providing your Vermont driver’s license number and responding to verification letters helps protect your refund and prevent fraud” said tax department Commissioner Kaj Samsom.

The most efficient and secure way to file Vermont tax returns continues to be electronic filing, and direct deposit to an existing bank account is the fastest way to receive a refund. Taxpayers who are eligible for free online filing will find more information about Free File on the department’s website at www.tax.vermont.gov. Taxpayers who e-file generally receive their refunds more quickly than those who file paper returns.

New online services

The department has launched myVTax, a new information system to modernize tax processing for all Vermonters. Taxpayers wishing to use these services may visit www.myVTax.vermont.gov. It will allow users to:

— File a renter rebate claim on the website or through a software vendor

— File an extension for personal income tax

— View Form 1099G online

— Respond to correspondence from the department

— Check the status of a refund, even when more information is required

— Make estimated payments and verify payments from last year

Submitted by the Vermont Department of Taxes.


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