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IRS pardons late TurboTax filers

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IRS pardons late TurboTax filers; users still mad at Intuit

Gregg Keizer

 

 

April 19, 2007 (Computerworld) The U.S. Internal Revenue Service yesterday gave frustrated Intuit Inc.'s TurboTax users an extra 48 hours to submit their returns without penalty after they were unable to electronically file Tuesday night on the company's overloaded servers.

 

Taxpayers and tax professionals using TurboTax or other Intuit tax preparation software and services have until midnight tonight to file their returns. "The IRS will not apply late filing penalties to taxpayers who were affected by this problem," the federal tax agency said in a statement.

 

On Tuesday -- the filing deadline for federal income tax returns this year -- an unexpectedly high volume of last-minute filers brought Intuit's back-end system to its knees. By midday Wednesday, Intuit said returns were being processed normally, and that the server load issues had been resolved.

 

"If you haven't already done so, please resubmit your tax returns now," a forum administrator wrote on the company's support site. "If you have already filed, you can now check status for confirmation that it has been received."

 

Intuit's biggest rival in the consumer tax preparation market, H&R Block Inc., didn't take long to make hay over its competitor's woes. Today, the Kansas City, Mo.-based maker of TaxCut said it would reimburse IRS late penalties for anyone who used its software or online service to file their return. The two caveats: taxpayers must file by midnight Saturday, April 21, and the maximum reimbursement is $100.

 

"We want to extend late filing benefits to all taxpayers, not just those impacted by the Northeast storms or another company's e-file issues," said Tom Allanson, group president of the company's digital tax division.

 

Although Intuit's stock price hasn't taken a hit from the problem -- since Tuesday's opening, Intuit shares have climbed 71 cents to $29.46 -- many users on the company's forums remain angry. Some blamed Intuit's advice for adding to the debacle.

 

"The lack of communication last night was appalling," wrote a user identified as Scott Waddell. "The advice the administrators provided on this message board was simply 'keep trying,' and that jammed up the server even more."

 

To make matters worse, Intuit spokesman Harry Pforzheimer was quoted by the Associated Press as saying "Don't wait until the last minute is the moral of the story," a comment that enraged users even more.

 

"Maybe they should have put that Associated Press quote on a big red sticker on the front of the TurboTax box?" said kosh on an Intuit forum.

 

"It is no [sic] our fault that their servers failed," said Better_Late_Than_Never. "I always wait to the last day and it has never been a problem before now. Procrastinators Unite!"

 

Yesterday afternoon Pforzheimer claimed that he had been misquoted by the AP reporter. "When asked by the reporter if the demand was caused by 'late tax filers and if this should cause folks not to procrastinate,' my comment was 'yes this was caused by last minute filers, but our customers should expect a good e-filing experience and to be able to file anytime they desire during the tax season," he said.

 

That didn't stop users from bashing Intuit and swearing to never use its tax prep products again.

 

"Blaming the customer for your crappy service is a shoddy move, sir," said lindyntn. "The least you could do is own up to your mistakes, apologize for it without making any backhanded reference to it really being our fault for your failure to perform, and stop giving people the runaround who want their money back per your own guarantee."

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My wife and I were discussing this and we come down on opposite sides.

 

My thought was that, while Intuit was clearly unprepared for the volume of returns thrown at their servers, ultimately those that wait until the last second to file their returns took that risk.

 

We have a friend whose mother was in the hospital the last 3 weeks of March and into April and finally passed a couple of weeks ago. It has been very hard on that family as they were close. She was one of the filers having difficulty and my wife thinks the extenuating circumstances make a difference. While I feel for our friends, it never would have been an issue had they not waited so late.

 

Looking at it from Intuit's stand point ... it is VERY difficult to predict what the peak in volume will be AND not very cost efficient to purchase the necessary hardware/bandwidth to handle the single peak they have in a year. Having said that ... they handling of the situation has been somewhat less than desireable from a PR stand point.

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Wow, here's an idea. Print the return out and mail it in if e-file isn't working!

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My thought was that, while Intuit was clearly unprepared for the volume of returns thrown at their servers, ultimately those that wait until the last second to file their returns took that risk.

 

 

 

Not unlike the old days, when the post office would stay open and have postmen on the street taking people's returns til the last second (IIRC...they even used to wait longer and stop the meters at 11:59pm). What if you got in an accident on the way and couldn't make the drop off? :D Too bad! No link but I thought I read where they were processing 1,000,000/hour! :D

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My wife and I were discussing this and we come down on opposite sides.

 

My thought was that, while Intuit was clearly unprepared for the volume of returns thrown at their servers, ultimately those that wait until the last second to file their returns took that risk.

 

We have a friend whose mother was in the hospital the last 3 weeks of March and into April and finally passed a couple of weeks ago. It has been very hard on that family as they were close. She was one of the filers having difficulty and my wife thinks the extenuating circumstances make a difference. While I feel for our friends, it never would have been an issue had they not waited so late.

 

Looking at it from Intuit's stand point ... it is VERY difficult to predict what the peak in volume will be AND not very cost efficient to purchase the necessary hardware/bandwidth to handle the single peak they have in a year. Having said that ... they handling of the situation has been somewhat less than desireable from a PR stand point.

 

 

I didn't see anything on the website or on any of the Turbo Tax boxes saying that they would not be able to handle e-filing. The IRS are the people pushing for e-filing.

 

As a company that holds itself as being able to handle the business, they should also be prepared for the number of people who tried to efile on the last day or any day.

 

As for looking it from Intuit's point of view - screw that. People are paying for a service and if you promise to deliver on it, you'd better.

 

Disclosure: I filed my taxes through Turbo Tax and had these problems.

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My thought was that, while Intuit was clearly unprepared for the volume of returns thrown at their servers, ultimately those that wait until the last second to file their returns took that risk.

 

 

In general, I'd agree, though some may have extenuating circumstances. I get mine done the moment the W2s arrive.

Wow, here's an idea. Print the return out and mail it in if e-file isn't working!

 

Agreed.

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I think that those people shouldn't get a break. File an extension etc. I did mine a month ago, and had the money taken out of my account on Friday. I really can't believe that that many people hand deaths/sickness in the family. It is truly amazing that people procrastinate on something that has to be done every year at the same time.

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I didn't see anything on the website or on any of the Turbo Tax boxes saying that they would not be able to handle e-filing. The IRS are the people pushing for e-filing.

 

As a company that holds itself as being able to handle the business, they should also be prepared for the number of people who tried to efile on the last day or any day.

 

As for looking it from Intuit's point of view - screw that. People are paying for a service and if you promise to deliver on it, you'd better.

 

Disclosure: I filed my taxes through Turbo Tax and had these problems.

 

 

So then you are prepared to pay $150 for Turbo Tax Basic next year instead of $30 so they can afford to purchase all the additional hardware and bandwidth required for a 24 hour per year spike?

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From turbotax - I think they've realized they screwed up and are trying to make things right with the customer. :D

 

will i be willing to pay more to ensure that i can e-file whenever? Maybe.

 

 

Dear TurboTax Customer,

 

We want to let you know that Intuit will be refunding any TurboTax credit card charges that were charged to your credit or debit card between 3 p.m. PDT Tuesday, April 17 and 4 a.m. PDT Wednesday, April 18.

 

We deeply regret the frustration and anxiety you may have experienced trying to e-file your return on April 17.

 

We worked closely with the IRS to allow taxpayers who were affected by the delay to file their returns until midnight tonight, Thursday, April 19, without penalty. Intuit will also pay any other penalties that customers incur as a result of the delay, although none are anticipated.

 

We will be contacting you early next week with additional details about this refund. We value your business and appreciate your patience.

 

Sincerely,

 

 

Bob Meighan

Vice President, TurboTax Customer Advocacy

Intuit, Inc.

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