2010, '11 tax refund checks are in the mail
Published: September 28, 2012
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ST. THOMAS - By Monday, almost $74 million in 2010 and 2011 tax refund checks will be in the mail.
For the last few weeks, people who have been waiting for more than a year for their 2010 refund checks began to receive money in the mail.
Now, those who are owed refunds for the 2011 tax year will soon get their checks, too.
The government borrowed millions to do it, closing on the $146 million bond issue two weeks ago. The bonds are backed by rum revenues.
"This is in keeping with promises that we made to aggressively pay outstanding income tax refunds upon closing the Series 2012 Working Capital Bonds," V.I. Finance Commissioner Angel Dawson Jr. said in a written statement. "We closed on the sale of these bonds in New York just two weeks ago, and working together with the Bureau of Internal Revenue, we have almost completed the payment of all pending income tax refunds."
Dawson said that by the end of business today, all income tax refunds submitted to the Finance Department by the Bureau of Internal Revenue will be processed, and checks will be mailed Monday.
The push was intended to bring the government up to date with refund payments because Fiscal Year 2013 begins Monday.
In Fiscal Year 2012, the Finance Department processed refund payments for tax years 2010 and prior totaling $38.2 million to approximately 15,500 taxpayers, according to Dawson. For 2011, the latest tax year for which refunds are due, the department will have processed $56.8 million to approximately 23,500 taxpayers by the end of today.
Of the $95 million paid to approximately 39,000 taxpayers this fiscal year, $73.9 million was processed in the last two weeks - representing payments to about 31,000 people.
"This is a tremendous amount of money to hit the streets of our territory at one time. And we trust that it will help to stimulate our economy, as residents give a much needed boost to our local merchants," Dawson said.
Gov. John deJongh Jr. commended Dawson, Bureau of Internal Revenue Director Claudette Watson-Anderson and their staffs for ensuring all pending income tax refunds were processed and paid before the close of FY 2012.
According to the Bureau of Internal Revenue, more than $30 million of income tax refunds paid in 2012 are from unfunded federal tax credits - like the earned income and child care credits. Because the territory's tax system mirror's the federal tax code, the local government must fund the credits, deJongh said.
"While these are well-intentioned mechanisms utilized by the federal government to assist families, they amount to unfunded mandates under our mirror tax system", deJongh said.
Dawson said that while all the refunds processed by the Bureau of Internal Revenue will be mailed out Monday, there may still be outstanding refunds that the bureau is auditing or holding for questions.
He asked people to wait a reasonable time to allow the checks to get to them through the mail.
If an expected check is not received by the end of next week, Dawson said taxpayers first should contact the Internal Revenue Bureau, in case there is a specific reason that their income tax refund has not been processed and transmitted to the Finance Department for payment.
Dawson also said refund recipients should be careful. Any time a large amount of cash is circulating in the community, it can become a tempting target for criminals, Dawson said.
For taxpayers who are receiving their refund checks more than 45 days after filing, a late payment will be included in the check.
Taxpayers who do not receive their refund within 45 days of filing accrue a 4 percent annual interest on their refund. To calculate the interest payments, the Bureau of Internal Revenue takes the refund amount and calculates 4 percent of that total. The 4 percent interest then is divided by 365 days. Each day after June 1 that the check is late - if the return was filed by April 15 - that portion of the interest is added to the refund.
- Contact reporter Aldeth Lewin at 714-9111 or email email@example.com.