For four consecutive years, the Colorado Department of Revenue has flagged several state tax returns while in a number of cases they have offered to send refunds through paper checks instead of sending a direct deposit. To those who are still planning to obtain a Tax ID in Colorado, they might not be familiar the term warrant which refers to checks when processing paper refunds from the state. Though the refunds come with a letter, there are still a number of taxpayers that were confused because of the term used.
Another point that creates confusion is the recommendation made to taxpayers to visit the branch of Wells Fargo directly if they are not willing to shoulder the fees that are charged by financial institutions. Wells Fargo is in charge of keeping the refund money for the state tax and they are willing to cash out the warrants, also known as checks, without additional charges. In addition, the state said that they do not have control over institutions that decide to impose charges.
One taxpayer named Barbara Cooper said that she went ahead to deposit her warrant to an automated teller machine under the credit union but it got rejected. After which, she decided to visit a location of Wells Fargo to cash out her warrant which she then brought back to the credit union in order to continue the depositing process.
She complained that the warrant holds their money therefore they must be able to access it in the most convenient way there is. The government is using warrants instead of checks when getting money from the Treasury account but the banking system recognizes the warrant the same way as checks.
According to a spokesperson from the revenue department, Mim Mirsky, there are a lot of financial institutions all over Colorado that were able to cash out or make a deposit using the checks in the recent years. Any financial institution will be able to process the checks without problem but some might have additional charges.
This matter is something that every taxpayer should know about even those who are planning to obtain a Tax ID in Colorado in order to avoid confusion and problem with their tax return.