Clue to those who overpay their taxes: Once you give money to the state, it isn’t yours until the state gives it back. You merely have a claim on it, like any other creditor. And as creditors go, you’re rather far down the list of priorities for repayment. Why? Because you, as an individual, lack a systematic means of coercive debt collection, especially in dealing with government.
Residents eager to get their state tax refunds may have a long wait this year: The recession has tied up cash and caused officials in half a dozen states to consider freezing refunds, in one case for as long as five months.
States from New York to Hawaii that have been hard-hit by the economic downturn say they have either delayed refunds or are considering doing so because of budget shortfalls.
“It’s an indicator of how bad it is,” says Scott Pattison, executive director of the National Association of State Budget Officers. “You know things are bad when you have to do that.”
Read more at USA Today.