IRS says it has fixed online filing 'hiccup'

By Mary Dalrymple
Associated Press

WASHINGTON — Thousands of electronically filed tax returns were initially rejected in the past few days because of a computer glitch.

The problem began Jan. 16 when the Internal Revenue Service officially opened the channels for electronic filing used by many professional tax preparers and individual taxpayers filing from their home computers. An error buried in 55 million lines of code, which had been updated to reflect new tax laws, caused the problem, which was corrected by Wednesday.

IRS spokesman Terry Lemons said no refunds will be delayed because of the early hiccup.

"We have resolved that initial problem," Lemons said. "We regret any inconvenience."

The glitch did cause a delay for taxpayers who had filed early returns and applied for refund anticipation loans, the immediate payment of an anticipated refund in exchange for a fee. The lender offering the refund anticipation loan typically needs confirmation that the IRS accepted a taxpayer's return before approving the loan.

Only a small percentage of electronically filed returns were rejected, Lemons said.

Taxpayers who file electronically get confirmation when their return is accepted and are notified when it is rejected. Electronically filed returns also can be rejected because of invalid Social Security numbers or math errors.

Denise Sposato, spokeswoman for H&R Block, said the company was quickly notified by the IRS and informed its customers, some of whom were not happy to hear about the delay.

"Fast isn't fast enough for everybody," Sposato said.