Roughly 50,000 New Yorkers who rushed to file early this tax season briefly got the short end of the stick. A typographical error in a state withholding table led to some early filers getting smaller refunds than they were owed, and in some cases being told they actually owed money. The state Department of Taxation and Finance says it has identified and fixed the mistake and will automatically reprocess all affected returns so corrected refunds go out. If you filed later in the season or have not filed yet, chances are you were not caught up in the glitch.
Who was affected
The problem mostly hit people filing as married filing jointly, along with some qualifying surviving-spouse filers, whose adjusted gross income fell in the roughly $107,650 to $161,550 range. The agency estimates about 52,000 returns were touched by the typo and that many of the shortages were relatively small, according to the Times Union. Tax preparers who spotted the discrepancy told reporters the differences were often under $100, but still managed to cause plenty of confusion and stress for early filers.
What went wrong and when
The typo was caught in the third week of February and corrected at the start of March. That timing meant returns filed before the fix could show reduced refunds or even tax-due notices that did not reflect what people actually owed. The error was buried in one of the withholding tables the state uses to calculate tax. As reported by the New York Post, the Department notified tax professionals once the problem was discovered.
How the state will fix it
The Department has told tax professionals it will automatically reprocess every affected return and send out corrected notices that include any additional refund amounts. In other words, the state says it will clean this up without putting more paperwork on taxpayers. "No taxpayer action is necessary," the notice said, according to the Times Union. Officials also characterized the total dollar impact as a fraction of 1% of all funds withheld this season.
What filers should do
If you received a smaller-than-expected refund or a surprise notice from the state, the recommended move is to sit tight and wait for the corrected notice and any additional refund. The Department says fixes will be issued automatically. If you want to double-check the status of your return or monitor updates from the agency, visit the N.Y. Dept. of Taxation and Finance website or contact your tax preparer for confirmation. If you receive a bill you suspect is wrong, your preparer can confirm whether your return was in the affected batch and walk you through next steps.
State officials say most people should see the issue resolved without filing an amended return. Still, the episode is a reminder that even a tiny typo in a tax table can ripple through a highly automated system. Keep an eye on your bank account and your mail for an updated notice in the coming weeks.
