Turbo Tax Accidentally Donates Your Money To The Oregon State School Fund?

A glitch in tax prep software may have resulted in unexpected generosity toward the Oregon’s State School Fund this year. Oregon’s state constitution requires that surplus revenue in the state’s general fund be refunded to the taxpayers at the end of the year. Now some taxpayers (including reader Erich, who sent this in) didn’t get their checks because they say Turbo Tax involuntarily donated the “kicker” to the Oregon State School Fund. Whoops!

“We are getting calls from people who are saying that they used some kind of an electronic software program to file their tax returns and that they did not check the box to donate their kicker,” said Rosemary Hardin, a spokeswoman for the Oregon Department of Revenue. “When we bring up their tax return, that box is checked.”

Hardin said it’s possible that people intentionally checked the box, then forgot. Still, the department is investigating.

Kicker checks — or thank-you letters for donations — began arriving in mailboxes Dec. 8.

About 12,000 people gave a total of $6.7 million in kicker refunds to the State School Fund this year.

That’s twice as many people, and nine times as much money, as was donated to the fund in 2001, the last time there were kicker refunds.

“We’re contacting at least one software company to have them look a little more deeply into their programming,” Hardin said. “We’re looking into if this is a glitch in some software programs or one software program.”

The Department of Education says that they don’t intend to keep accidental donations, but they may have to. There’s no provision in the law for reversing donations. TurboTax says they haven’t received any complaints about the issue.

Bob Meighan, a vice president with Turbo Tax, said the company has not received any complaints regarding Oregon’s kicker provision.

He ran through the program Friday afternoon and said it clearly asks users whether they wanted to make the donation and warns them that the decision is irrevocable.

Odd. If you’re one of the inadvertently generous, you here’s some information from the State of Oregon.

UPDATE: Oregon has been unable to locate the source of the problem and has decided to offer refunds to all taxpayers who filed electronically.

State School Fund Kicker Donation Update [Oregon]
Some report kicker funds donated erroneously [StatesmanJournal]
(Photo:CC and Sunny)

Comments

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  1. DrGirlfriend says:

    A bummer…but at least the money is going to a worthy cause. Right? Easy for me to say, as I have my kicker check safe and sound.

    And yes, Oregon *is* pretty!

  2. rbb says:

    Well, that makes me glad I use TaxAct.

    I still have not forgiven TurboTax/Quicken for their insidious copy protection scheme a few years ago.

  3. warf0x0r says:

    Wow, that is the suck.

  4. MatthewVA says:

    TurboTax isn’t the first to raise money in an unique way for Oregon schools. There were old dudes posing nude to raise funds. That is how bad it is.

    [tiny.cc]

  5. My check was over $400. I would’ve gone ballistic if those greedy bastards kept it.

  6. Buran says:

    Seems like TurboTax should step up and refund all the money they took from their customers.

  7. winnabago says:

    Why do they call refunds ‘kickers’ in Oregon?

  8. pepe the king prawn says:

    that’s an average of about $550 per person. and nobody’s complaining? i seriously doubt that.

  9. Sucko-T says:

    @winnabago

    It’s not really a refund. It “kicks” in if the state budget has a surplus.

  10. Munsoned says:

    I hope TurboTax has good insurance!

  11. RuralRob says:

    An American government entity has a budget SURPLUS? What strange parallel universe did I just fall into??

  12. TechnoDestructo says:

    @strum40:

    They refund the ENTIRE surplus, or do they retain part of it for lean years? (Speaking of which, I wonder how long Alaskans think they’ll be able to keep drawing dividends?)

    @ruralrob:

    I dunno, the Clinton years?

  13. kiloman says:

    “I’m sorry class, but since our class funds were donated to us by accident, we’re going to have to sell the class turtle for scientific research to help pay it back.”

  14. Half Beast says:

    TaxAct fo’ lyfe.

  15. Sucko-T says:

    @TECHNODESTRUCTO

    [www.oregon.gov]

  16. PracticalMagic says:

    Was this return filed on-line? I use turbo tax myself, but I’ve never felt comfortable sending it on-line. My dad did that a few years ago, and ended up having to pay an attorney quite a bit of money to straighten out the IRS. They claimed he never sent in his taxes, and tried to get $23,000.00 from him. It took over a year to fix the mess. I’m a paper return kind of person myself.

  17. scoosdad says:

    Doesn’t Turbo Tax let you print out all of the usual and standard versions of the federal and state forms for your own records at the end, even if it’s an e-file? If it doesn’t, sucks to be you. Tax Cut does that, and you can look it over and see if all the entries and ‘checkboxes’ are done to your liking before you click “file”.

    Anyone who doesn’t at least do that step before e-filing is just asking for problems later on.

  18. QuantumRiff says:

    @TechnoDestructo: The state budget is a two year budget. They project their tax revenue at the start, and budget around that. (ie, they’ll predict 10Billion over 2 years will come in). If the taxes coming in exceed the budgeted amount by more than 2%, the entire surplus gets returned. They were stupid, and didn’t put it in a “rainy day fund”. However, this year, they changed the ruling a bit, and only citizens get their kicker checks. Businesses tax surpluses go into a school rainy day fund now.

  19. kbarrett says:

    Quantumriff: They weren’t stupid … they just weren’t a bunch of socialists.

    “rainy day fund” = more money to waste. It always rains in Oregon, dontcha know? Now that ex-Californians are a majority in this state, expect to see more state mandated “generosity” of this stink.

    I’m sure refunding that surplus to us mere peasants will be deemed too expensive once the thieves in Salem think they can get away with it.

  20. B says:

    @kbarrett: Ron Paul, is that you?

  21. MercuryPDX says:

    @Petrarch1603: I got back $547. SOoooooo glad I use an accountant and not software.

  22. PenguinBlue says:

    That really sucks. I got back around one third of what I paid in Oregon state tax this year, so people might have accidentally donated a lot of money!

  23. Sucko-T says:

    I’d really hate to be a Washington resident who didn’t get money back. Talk about a slap in the face, paying for services you can’t use (Roads are covered by the gas tax) and then not getting your kicker back.

  24. Vandon says:

    @PracticalMagic: They claimed he never sent in his taxes, and tried to get $23,000.00 from him.

    That’s why you keep the printed out copies of the forms and keep that one extra form you get about 12 hours later with your IRS confirmation number that proves your tax forms were sent and accepted.

  25. chickymama says:

    @strum40:
    Actually, if you work in Oregon and live in Washington, you can still get the kicker check. I have many coworkers that are in this scenerio and received kicker checks.

    @TechnoDestructo:
    Being a former resident of Alaska in which I received many permanent fund dividend checks….it won’t be going away anytime soon unless there is a vote. The fund was created by the oil royalties and is put in the permanent fund. this money is then invested in bonds and stocks. the check is based on a five year average on the interest earned. That is why the check is a different amount every year. The last time I received one was in 1999 and is was $1700.00. After that it went up to about $1900.00 then started to slide down due to the stock market falling. It has since started to average out to about $1K.
    There have been some ideas to do away with it by cashing every Alaskan out, the amt would be about $25K apiece. But like I said it would take a vote but I am not sure if that is from the legislature or the people

  26. tnuser says:

    “that’s an average of about $550 per person. and nobody’s complaining? i seriously doubt that”

    I have sent a complaint to Turbotax and Oregon state dept…

  27. furseekr says:

    @STRUM40: Washington residents (or anyone else) who pay Oregon income tax get their kicker refunds too.

  28. aronsonw says:

    I sent the below via e-mail to the state Dept. of Revenue yesterday. Have not heard back yet, but will be calling them tomorrow and also will be filing a formal complaint with TurboTax. After reviewing my printed form (I always file by mail) and the saved tax return within TurboTax software, it is clear there was a glitch in the software which caused it to check a box on the PDF file and subsequent printed form that was NOT checked by me while using the software.

    “When I did not receive a kicker check in the mail, but instead a letter from the state thanking me for my donation to the State School Fund, I opened up my 2006 return in the TurboTax software, clicked on “State”, and then on “view forms”. The electronic form within TurboTax does NOT have an X in the box for “donate any kicker”. However, I looked at the paper form that I printed and mailed to the state, and it did indeed have an X in that box, as did the PDF file TurboTax generates that I used to print the paper forms. I had not noticed this before I mailed the forms to the state, because I assumed TurboTax filled them in consistent with my answers and I did not review the printed forms in much detail. It is clear in the software, however, that I had NOT checked the box to donate my kicker. It is clear that this was a problem with the TurboTax software. The kicker calculater shows my wife and I should be receiving $533. What process do I need to go through to claim that amount?”

  29. MercuryPDX says:

    @strum40: Psst.. I’m a Washington resident (Vancouver) who works in OR (Portland). See my post above.

  30. TurboTax says:

    TurboTax did not – I repeat – DID NOT opt these folks into giving this donation. TurboTax NEVER defaults to a “yes” when asking if a taxpayer wants to donate money to any fund.

    We’ve conducted extensive research over the last four days and believe TurboTax is correctly computing and reporting to Oregon Dept. of Revenue the Kicker Rebate.

    Based on concerns raised by Oregon taxpayers, the state Dept. of Revenue asked us on Friday (12/14/07) to look into how TurboTax handles the Kicker Rebate. Our research included testing all combinations of forms (resident, non-resident and part-year), filing methods (paper and electronic filing), and tax scenarios. We also examined TurboTax data files provided by consenting taxpayers and did a TurboTax code review.

    In no case could we generate an incorrect result or see any result inconsistent with what one would expect. From time-to-time, we do make mistakes and in those cases, we acknowledge those errors. Nothing is more important to us than earning the trust of our customers and we will not compromise this in any respect.

    We will continue to work with our customers and the Oregon Dept. of Revenue to ensure the accuracy and integrity of our customers’ tax information. If you filed using TurboTax, you can be confident that the information you entered was accurately reported to Oregon.

  31. TechnoDestructo says:

    @chickymama:

    I lived in AK for 23 years, and even if they cashed out, I wouldn’t consider it worthwhile to go back.

  32. aminoplacid says:

    Good news for those who got the short end of the stick (like myself). The Oregon Dept. of Revenue has decided that they will refund mis-donated kicker checks. See their webpage on the issue: [www.oregon.gov]

    Steps are as follows:
    1. Make a copy of the front page only of your 2006 Oregon tax return (Form 40S, 40, 40P, or 40N) that shows that you did not check the “donate kicker” box; write “kicker” plainly across the top of the copy of the return.
    2. On the back of the tax return copy, write: “I certify that I did not check the box to donate my tax year 2006 kicker to the State School Fund.”
    3. Sign and legibly print your name, and include the date. If you filed jointly, both spouses must sign and date.
    4. Mail the copy of your tax return with the certification statement on the back, along with the letter you receive from the department, to:

    Oregon Department of Revenue
    PO Box 14600
    Salem OR 97309-5049

    Please do not e-mail or fax us this information.

    Your envelope must be postmarked by February 1, 2008.

  33. bmeighan says:

    I believe it’s been adequately tested and documented that there was NO GLITCH in the TurboTax software. Unfortunately, those who reported on the “glitch” failed to follow up and report that it was not TurboTax software at fault.

    Bob Meighan
    VP, TurboTax