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Intuit has halted the transmission of all state e-filing tax returns on worries of rampant fraud, the company said Friday.
During the current tax season, Intuit said the company and some states have noticed an increase in "suspicious filings" and attempts to use stolen information to file fake state tax returns, and then claim resulting tax refunds. Although the company said it did not believe its systems had been compromised, it said it took a "precautionary step" on Thursday by pausing state return e-filings.
"We've identified specific patterns of behavior where fraud is more likely to occur. We're working with the states to share that information and remedy the situation quickly. We will continue to engage them on an ongoing basis in an effort to stop fraud before it gets started," said Brad Smith, Intuit president and chief executive.
Intuit said in a statement that it is working with state agencies to address "growing concerns over state tax fraud." The company said it worked with third-party security expert Palantir to determine that the fraud likely did not result from a security breach of Intuit systems, and that the information used to file the false returns was likely "obtained from other sources outside the tax preparation process."