Taxable Talk

Kansas announced that if you file a paper return, you could wait 16 weeks for your refund. The Sunflower State is having budget troubles, and the Kansas Department of Revenue responded by not hiring temporary workers for this tax season. The temporary workers normally process the paper returns, but not this year. Full-time employees will have to do them as they have time.

There is an opportunity here if you owe money, though. If you file a paper return, your return may sit gathering dust for four months. That’s quite a bit of float on what you owe. However, if you file a paper return and are expecting a refund, you may be Waiting for Godot.

Hat Tip: Don’t Mess With Taxes

Republican legislative leaders and Democratic Governor Kathleen Sebelius reached agreement on a package of legislation that ends the Sunflower State’s budget crisis. Governor Sebelius signed legislation that cut $300 million in the current budget year; once that was signed, Republican legislative leaders allowed interbudget borrowing that allowed the current payroll and tax refunds to be issued. All sides believe the budget issues for the fiscal year ending in June have been resolved.

But next year looks tight, and everyone agrees that the 2009-201 budget will be challenging. Governor Sebelius red-penciled the current year education cut (from $32 million to $7 million). It’s likely that there will be significant cuts in education in next year’s budget.

Meanwhile, no change here in California—just a lot of bickering in Sacramento.

Kansas has joined California in having a budget crisis. The Sunflower State is out of money to pay income tax refunds, Budget Director Duane Goosen told the Wichita Eagle. Also threatened is the state’s payroll and medicaid payments.

The Kansas crisis appears to have many similarities to California’s, though on a much smaller scale. Kansas appears to be about $330 million in the red (compared to $41 billion in California). Republicans passed a bill that cuts $326 million from the current budget; it’s unclear whether Democratic Governor Kathleen Sebelius will sign the legislation. While there are funds in place in other Kansas accounts that could cover this weeks’ debts, Republicans won’t allow any more ‘IOUs’ to be issued (those IOUs allow money to be lent from one Kansas account to another).

I’ll keep you informed.

Hat Tip: Don’t Mess With Taxes