Tax Day glitch hits 70,000 Utahns; state tax payments rejected

SALT LAKE CITY — A technical glitch at the Utah State Tax Commission affected roughly 70,000 taxpayers who attempted to pay their state taxes on April 15, preventing all scheduled payments from going through.

State officials said the issue stemmed from an error in a file sent to the bank for processing. Deputy executive director Jason Gardner said the commission recently upgraded its internal system, but a mistake in the file — specifically, the omission of special characters in the code — caused the bank to reject the entire batch of payments.

"It was our file that we transmit to the banks that had an error in it," said Gardner. "That led to the banks rejecting the file, which led to the payments not being deducted."

The error wasn't discovered until Friday afternoon when KSL notified the commission. Chase Bank sent confirmation later that evening. Gardner said officials began working to fix the issue first thing Monday morning.

Gardner acknowledged the scope of the problem, noting it is the largest single-day payment failure he has seen.

"I've never seen this many payments fail to process on a single day," he said, adding that the commission processes millions of transactions each year with 2.5 million taxpayers in the state.

Despite the disruption, the commission emphasized that taxpayers will not face penalties or interest charges. Payments will be treated as if they were made on time.

"The payment will be treated as if they made the payment last Wednesday," Gardner said. "They'll be completely fine, held harmless."

Officials said the delayed payments are expected to be processed by midnight on Wednesday, April 22, with withdrawals appearing in bank accounts by Thursday morning.

The issue only affects tax payments and not refunds. Those expecting refunds will still receive them on the normal timeline, with many deposits expected by mid-May, according to Gardner.

While the glitch caused confusion for thousands, Gardner noted there may be a small silver lining.

"It's a glitch that ultimately … is in favor of the taxpayer," he said. "They're not going to be asked to pay more money — in fact, they'll benefit a little bit from being able to keep their money longer."

The commission said it has identified and corrected the error and taken steps to ensure that specific error does not happen again.

Taxpayers who believe they were affected or do not see their payment processed after Wednesday are encouraged to contact the Utah State Tax Commission directly at 801-297-2200.

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