States May Stall Tax Refunds for Months

Thanks again, recession. Because many states are now strapped for cash, it could take several months for residents to receive their state tax refunds this year. Most states typically send out refunds within 30 days but this year, New York, for instance, could delay handing out $500 million in refunds, while Hawaii is saying that some residents may not get their refunds until late August. "It's an indicator of how bad it is," says Scott Pattison, executive director of the National Association of State Budget Officers. "You know things are bad when you have to do that." Last year, it was even worse for California, which is dealing with a $20 billion budget shortfall. The state delayed tax refunds and issued billions of dollars worth of IOUs to people who were owed money. This year, however, Californians are being told to expect their refunds on time.