Department of Revenue reports high e-filing adoption, warns of fraud and cites ~ $21 billion collected last year

The Department of Revenue told the committee that electronic filing has become the norm and that the agency is focusing on fraud detection and timely refunds. The director said roughly 95% of returns are now filed electronically and that the department is electronically issuing refunds. "We used to have stacks of paper returns. 95% of the returns now are filed electronically," the director said.

The director cautioned that fraud remains active and that staff are using data and vendor partnerships to identify suspicious filings. Asked about artificial intelligence, the director said the department uses vendor-supplied intelligence and named Fast Enterprise as a long-time partner used by about 15 other states to help craft its system. "We use that information. They bring it to us, and we craft it for what we need," the director said.

On revenue, the director stated that last year the department collected about $21,000,000,000, and that $14 (as stated) went to the general fund with remaining collections distributed to local governments (the transcript gives that allocation in brief terms). At the time of the hearing the director said there were no special budget requests or provisos and asked the committee to continue funding the department at current levels.

Committee members thanked the director for constituent assistance handled by the department and raised questions about future uses of artificial intelligence; the director said AI is viewed as an auditing and fraud-targeting tool rather than a replacement for staff.