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Some (Turbo) taxing questions about our state

I came across a story on a recent front page of The Oregonian that set off my internal rant system and it refused to shut down until I wrote this response.

The headline of the article read: "'Human error' led to massive tax refund."

The gist of the story was that a young woman, using TurboTax to file her return, claimed she was due a tax refund from the State of Oregon of $2.1 million based upon $3 million in income.

Sure, that can happen to any of us in a good year - win the lottery, whatever. The shocking part of the story is that the State of Oregon did not blink, but rather issued a debit card good for $2.1 million to this lucky woman.

With a government this generous, you do not need to win the lottery. Now, it turns out that the computer system used to process the tax returns did red-flag this particular claim. That meant that someone had to take a look at it and approve the payment and this is presumably where the human came in.

The fact that the payment was approved raises a whole host of questions:

1. Was there just one human that needed to sign off on this payment? (A recent update suggests that there were two individuals involved.)

2. Was this human being paid to think or just to process?

3. Is the human who made this error still working for the State of Oregon?

4. Is it possible that said human was acquainted with the lucky claimant?

5. Did the lucky young woman also score a federal tax refund?

6. Is there not some simple system in place that would allow the humans to check to see whether this taxpayer had actually paid $2.1 million into the system in withholding or estimated tax payments? (When I file my taxes and request a refund, I generally assume that some such cross-checking is done. Now that I know that this is not the case ... oh, never mind.)

7. Was the pressure to get tax refunds out quickly to boost the economy so great that there was no time to say, "Wait a minute. This looks fishy?" (The lucky young woman wasted no time in spending $200,000 of her windfall. Many local merchants presumably benefited and there may have been some trickle-down effects.)

8. Who is in charge here?

Actually, it is unlikely that such phenomenal incompetence can be laid at the feet of just one erring human. It is far more likely that the problem is systemic. Pressures, policies and procedures coming down from on high put this poor human in a spot to blow it. Red flags were waving all over the place on this return, but the system (and the human) was able to ignore them.

The bigger question regards what is being done to avoid such travesties in the future. Apparently the word is out on the street that it is really easy to defraud the government by using TurboTax or other methods of e-filing. How much money is the state losing by not having adequate cross-checking systems in place?

We need answers.

Tom Griffith lives in Forest Grove.



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