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I use an online service to file (HR Block). I received all my relevant paperwork to file my federal and state income taxes by about January 27th. So I filed that evening. My federal went through just fine and had my refund in the bank in about 8 business days.
My state refund was set to be deposited but I received a check for MUCH less than I anticipated in the mail. Saying my state withholding didn't match what they had on file. So I called in, waited a few hours on hold and was told because I filed so early my company had not reported the 4th quarter withholdings yet so the state only had the number for the first 3 quarters, thus my refund based on what they knew came out to a lot less. They blamed me and my company. Said I should never file before early February and my company was too slow in reporting the 4th quarter withholding.
In previous years I'd get an error when I went to file state that "CA isn't ready for your return until X date" and it wouldn't let me click the file button until then. It doesn't really matter but I'm just wondering if this is the states fault for accepting my return with only 3 quarters of withholding, my fault for filing early, HR blocks fault for allowing me to file early (doubt it), or my companies fault for not reporting withholding in a timely manner?
After my call with the state, they said it would take a month just to get my request with my proof of withholding entered into the system then another 2-5 months to get it processed and the proper refund issued. As an added frustration he said that if I file again early next year the same will happen so they advise I wait until close to the April 15th deadline to file. They blame it on a new system that "has changed everything".
Overall I'd say it was a combo of your error and the state not flagging that all tax forms may not have been filed yet. I actually find it a little odd that your Fed tax went thru. I'm surprised that H&R Block didn't warn you that all tax docs impacting your tax may not have been filed at that time.
Your employer may well have reported in a timely manner. State Quarterly forms due by the end of the month. However they're not past due until the end of the month following. In short, your employer did timely reporting if their Q4 2016 form was filed by Jan 31. They may have had to have remitted the tax earlier but the form that matches the tax amount paid to each employee/SS# isn't due yet. It's possible that your employer filed their Fed 941 earlier than the state form.
IMO it's never a good idea to file earlier than the first part of Feb. 1099s, 1098s and other tax forms are required to be mailed by Jan 31. It isn't unusual for me to still be getting tax forms in the first week of Feb.
My guess as to why the additional refund is taking so long is that you've gone out of the que of "normal filing" and into an audit/adjustment que.
I use an online service to file (HR Block). I received all my relevant paperwork to file my federal and state income taxes by about January 27th. So I filed that evening. My federal went through just fine and had my refund in the bank in about 8 business days.
My state refund was set to be deposited but I received a check for MUCH less than I anticipated in the mail. Saying my state withholding didn't match what they had on file. So I called in, waited a few hours on hold and was told because I filed so early my company had not reported the 4th quarter withholdings yet so the state only had the number for the first 3 quarters, thus my refund based on what they knew came out to a lot less. They blamed me and my company. Said I should never file before early February and my company was too slow in reporting the 4th quarter withholding.
In previous years I'd get an error when I went to file state that "CA isn't ready for your return until X date" and it wouldn't let me click the file button until then. It doesn't really matter but I'm just wondering if this is the states fault for accepting my return with only 3 quarters of withholding, my fault for filing early, HR blocks fault for allowing me to file early (doubt it), or my companies fault for not reporting withholding in a timely manner?
After my call with the state, they said it would take a month just to get my request with my proof of withholding entered into the system then another 2-5 months to get it processed and the proper refund issued. As an added frustration he said that if I file again early next year the same will happen so they advise I wait until close to the April 15th deadline to file. They blame it on a new system that "has changed everything".
Who is at fault? Doesn't really matter, does it. The state told you the problem and that it will be a problem in the future, plus how to avoid it. You are not going to change how the state operates or your company. What you can change is your withholding to more accurately reflect your actual tax responsibility, so at tax time you are not waiting for a big refund, instead have the money in each check.
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