SC to delay state tax refunds to fight fraud

COLUMBIA, S.C. – In an attempt to combat fraud, South Carolina taxpayers won’t be receiving their state income-tax refunds until March 1 or after.

In a statement, the South Carolina Department of Revenue said that the delay will give the agency time to verify wage documents with the Internal Revenue Service and ensure that taxpayers’ refunds aren’t stolen.

SCDOR spokeswoman Ashley Thomas said it’s possible that early tax filers could receive their refunds before Mar. 1. But she said most refunds would be issued on or around the first of the month.

“We have a tax fraud pandemic. It is our obligation to make sure that refunds wind up in the right pockets,” Thomas said.

While employers must send W-2 wage statements to employees by Jan. 31, Thomas said those documents often don’t reach the IRS until weeks later.

Taxpayers filing after March 1 can expect refunds within two to three weeks of the date those returns are received by the state.

Those security measures include predictive analytics software, as well as other measures, which the agency wouldn’t disclose so as not to tip their hand to cyber thieves.

Thomas said the agency realizes that delaying refunds isn’t popular.

“We know we aren’t going to win any popularity contests, but we must protect taxpayer refunds,” she said.