TurboTax Filers Given More Time After System Turns Taxpayers Away

SAN FRANCISCO – Taxpayers and tax professionals who e-file with TurboTax and other Intuit Inc. products now have until midnight April 19 to file their taxes, after the company's overloaded computer servers turned away last-minute e-filers on Tuesday.

"Some customers had delays in submitting their electronic returns. Some customers unfortunately were not able to file at all," said Julie Miller, a spokeswoman with Intuit Inc. (INTU) , operator of TurboTax.com, in an interview Wednesday.

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As many as "several hundreds of thousands" of taxpayers and tax professionals were hit by the hold-up, according to an IRS announcement Wednesday, though the exact number is unclear. The IRS is giving taxpayers who file with Intuit products such as TurboTax.com until April 19 to file.

More than one million taxpayers and tax professionals successfully e-filed with TurboTax or other Intuit products on Tuesday, the tax filing deadline — double the some 500,000 who e-filed with Intuit on the tax-deadline day a year earlier, Miller said.

But at about midday Pacific time Tuesday, taxpayers who tried to e-file their completed returns got a message asking them to return in a few minutes to finish the process "due to high volume."

As the day wore on, taxpayers were asked to return in two to four hours, Miller said. "That's not the right experience for customers as you approach the deadline. We understand this caused a lot of anxiety and frustration."

The problem occurred in the company's back-end server, Miller said, which supports TurboTax as well as products for tax professionals such as ProSeries and Lacerte, and Intuit's Free File offering, TurboTax Freedom.

Taxpayers did not have trouble filling out their online return. The problem occurred when they tried to send their return to the IRS, she said.

"Over the next couple of days we're focused on, first making sure all these folks get their returns filed in a timely fashion and, two to dig in and fully understand what happened. We think volume was the biggest factor here, but we're going to look at the technology, our servers," Miller said.

Every year, as soon as tax season ends, "we spend a lot of time forecasting, building out our technology and infrastructure to create a big enough pipeline to handle growth, and then we throw in a bit more," she said. But "yesterday exceeded all our expectations," she said, noting that the company processed 1.28 million returns.

IRS acts three times in three days

The IRS' offer of an extension to file is the third such offer in as many days. On Monday, the IRS said taxpayers living in states pummeled by the major storm in the Northeast have two extra days to file, but then on Wednesday the IRS offered more time, announcing that those taxpayers have until Thursday, April 26.

On Tuesday, the IRS granted a six-month extension to those taxpayers affected by the shootings at Virginia Tech.