Question: I participate in the state tax program where instead of paying a big amount at the end of the year, you can break it up throughout the year and pay in increments. You do this by using form N1. I mailed my April payment on April 13 in the amount of $225. My next one is due in June. However, the April payment has not been cashed by the state yet. So it makes me hesitant to submit my June payment. Was my payment received? Did I put the wrong address on it? It would be nice if the state would cash these checks in a timely manner so that the taxpayer is confident that it was received and that it is OK to submit the next payment. I cannot call the department because they don’t answer the phone and it is a maze of voicemail. Can you perhaps look into this for me and others? Seems like the state is always needing money, so why would they not cash these checks in a timely manner in order to instill confidence in the taxpayer?
Answer: Kokua Line received your question May 18, and with your assent forwarded it that day to the state Department of Taxation in hopes of getting a specific answer. Department spokeswoman Mallory Fujitani responded May 20 that, absent power of attorney, the department could not provide Kokua Line details of a taxpayer’s account, but that a departmental staff member would follow up with you directly.
Fujitani also had to follow up with staff regarding your related, more general questions; we received her answers June 2:
Q: Has the reader’s April payment been received?
A: “As mentioned earlier, we are not able to discuss (the reader’s) specific situation with you; however, our staff did follow up to ensure nothing unusual has occurred to her tax account.”
Q: If yes, do you know when the check will be cashed?
A: “As of May 24, we were processing checks from the third week of April (the week of the filing deadline). We are unable to provide an estimated check deposit date for paper checks.”
Q: Should a taxpayer send in the next incremental payment as scheduled even if the first check was not cashed?
A: “Yes, taxpayers making estimated payments should submit their payments according to their quarterly payment schedule. This taxpayer sent in a paper check the week before the biggest state tax filing deadline; the volume of tax filings and checks submitted during this time is always extremely heavy, so processing paper checks always takes a little longer. Absent an extraordinary problem, checks are deposited before the next quarterly payment is due. To avoid concerns about delays in depositing paper checks, the department encourages taxpayers to pay electronically via an electronic funds transfer.”
Q: How long, on average, does it take to cash a tax-payment check?
A: “The time to prepare a paper check for deposit varies greatly from days to weeks, depending on the time of year; on average, the process could take three to four weeks upon receipt of the paper check.”
Q: Why does it take that long?
A: “With the exception of General Excise Tax vouchers and payments that are sent to a separate lock box, the department processes all payments made by paper check. In short, the time to deposit checks is lengthy due to the volume of paper checks received and the manual check reconciliation process. The department, however, is looking forward to faster check processing functionality with the implementation of the second roll out of Tax System Modernization in August 2016. The second roll out includes implementation of some business taxes, including the General Excise Tax and the Transient Accommodations Tax. Along with enhanced electronic check processing, new e-filing services will be available.”
As for your difficulty getting through to the department by telephone, Fujitani has previously addressed this ongoing concern of Kokua Line readers. In September she said that a high volume of phone calls (over 1,300 a day in 2015), short staffing and an outdated telephone system all contributed to the problem.
Write to “Kokua Line” at Honolulu Star-Advertiser, 7 Waterfront Plaza, Suite 210, 500 Ala Moana Blvd., Honolulu 96813; call 529-4773; fax 529-4750; or email kokualine@staradvertiser.com.
