Will your Missouri tax refund be late -- again?

Taxpayers across Missouri are in the middle of submitting their state and federal returns. The looming deadline in mid-April means penalties and interest for those who owe and file late.

But what if it's the government that owes you money and misses its deadline to send your refund? Missouri taxpayers have been finding those delays all too common recently -- and the problem is getting worse, as my audit on the timeliness of income tax refunds by the Department of Revenue discovered.

The state has to issue refunds within 45 days of receiving the filing, or pay interest. But as my office conducted this audit, we heard from thousands of frustrated Missourians who were waiting much longer than that to get their money back.

The facts are troubling: over the past two years and during two different administrations, the State of Missouri was late in issuing more than one out of every four refunds. In 2017, the Department of Revenue delayed more than 550,000 refunds, including 155,000 refunds that came with late interest the state had to pay.

Why don't all late refunds come with interest? Because the setup is inherently unfair to taxpayers. The interest rate paid on a late refund is very low: less than 1 percent, compared to the four percent taxpayers must pay for being late. Even that interest isn't paid until it accumulates to $1 -- which would take a year on a refund of $250.

To avoid paying interest, the administration issues refunds strategically and not necessarily in the order in which returns are received. A family of four expecting to get back a few hundred dollars is left waiting behind a later-filing corporation or high-income taxpayer.

So with little incentive to quickly pay smaller refunds, the administration has decided it's worth paying a pittance in interest -- or no interest at all -- to hold back many refunds as long as they can. Those refunds may seem smaller to the state, but Missouri families are counting on them to pay bills, or go toward college tuition or savings.

To help taxpayers, I'm supporting House Bill 2165, sponsored by Rep. Lauren Arthur, of Kansas City. This bill would require the state to pay the same interest rate on late refunds as taxpayers must pay if they are late, and also require the state to pay interest on all late refunds. Unfortunately, more than two months after this bill was filed and with less than two months to go in the legislative session, the House leadership has not even referred the bill to a committee to receive a hearing.

After my audit on the delays in tax refunds earlier this year, the Governor's Office said it was making changes. I'll be watching closely to ensure the governor keeps his word that Missourians will receive their tax refunds on time.

My office has just begun another audit on the timeliness of tax refunds for this tax season. Citizen feedback again will be vital as we determine whether the administration is complying with the law mandating timely refunds. Individuals may file a complaint with the State Auditor's Whistleblower Hotline by calling 800-347-8597, by emailing moaudit@auditor.mo.gov, or by using the online submission form at auditor.mo.gov/hotline.

When my audit is completed, I will let citizens know if the state has improved its performance or if the administration continues to put other priorities ahead of issuing tax refunds to working Missouri families.

Nicole Galloway is the auditor for the state of Missouri.