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IRS finds fix for e-file problems

A "hardware failure" had limited tax processing systems at the agency.

February 5, 2016 at 1:38AM
FILE - In this March 22, 2013 file photo, the exterior of the Internal Revenue Service (IRS) building in Washington. Got a question for the IRS on your taxes? Online may end up being the only answer. The IRS may soon dramatically scale back telephone and face-to-face service as part of a future plan that would focus more on online accounts for the 150 million individual taxpayers and 11 million businesses seeking help and information, the agencyís official watchdog warned. (AP Photo/Susan W
An Internal Revenue Service computer problem on Wednesday prevented tax returns from being filed electronically. (The Minnesota Star Tribune)

The Internal Revenue Service said it had resolved a computer system outage and is again accepting electronically filed tax returns.

In a statement released on Thursday, the agency said it had resumed processing individual and business tax returns, a day after a "hardware failure" forced the shutdown of several tax processing systems, including the e-file system.

IRS Commissioner John Koskinen said taxpayers should see little, if any, impact on their returns or refunds. Koskinen said employees worked through the night to get the system back online and he apologized for the inconvenience.

The agency said taxpayers do not have to take any additional action due to the outage, even those who filed returns electronically before or after the computer problems.

On Wednesday, Matt Leas, an IRS spokesman, had said a "power or electrical issue" caused the failures.

He provided no additional details.

Meanwhile, the IRS warned about tax scams involving the Affordable Care Act and penalties imposed under the law on people who go without health insurance.

In some cases, the agency said, unscrupulous tax preparers were telling clients to pay the penalties directly to them, and the they kept the money.

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Most people do not owe the payment at all because they have health coverage, such as Medicaid or employer-sponsored insurance, or qualify for one of many available exemptions.

"However," IRS officials said, "if you owe a payment, remember that it should be made only with your tax return or in response to a letter from the IRS. The payment should never be made directly to an individual or return preparer."

The creators of these schemes have been "targeting taxpayers with limited English proficiency and, in particular, those who primarily speak Spanish," the agency said.

Unauthorized immigrants appear to be particularly vulnerable.

They are sometimes told that they must make penalty payments directly to a tax preparer because of their immigration status, the agency said.

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