Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: THURSDAY, September 15, 1994                   TAG: 9409150074
SECTION: VIRGINIA                    PAGE: A-13   EDITION: METRO 
SOURCE: Associated Press
DATELINE: RICHMOND                                LENGTH: Medium

RETIREES HURRY TO FILE FOR REFUNDS

``I think we're on target, quite frankly,'' Payne said, noting that the state Department of Taxation has hired additional staff to respond to phone calls and provide assistance to pensioners.

About 186,000 federal retirees are eligible to participate in the five-year, $340 million refund program for taxes the state illegally collected from 1985 to 1988.

The state has hired about 45 people part-time to help retirees seeking refunds. They include people who have worked for tax-preparation companies, Payne said.

The deadline for filing overpayment forms with the Department of Taxation is Nov. 1.

All retirees eligible for the settlement should have received forms at the start of August. Since then, the state has been running notices in major newspapers in Virginia, Maryland the District of Columbia, Florida, North Carolina, Texas, Arizona and California to alert retirees to the filing deadline, Payne said.

Notices also have appeared in USA Today and publications aimed at retired military personnel.

Payne estimated about half of the $3.5 million the General Assembly approved for administration and notification of the settlement program will be spent on media buys.

Of the overpayment forms that had been sent in, about 7,200 include figures or information that still must be resolved, Payne said.

Despite an error discovered this summer, Payne said he's pleased with how the system has worked. In August, the Department of Taxation sent about 80,000 military retirees incorrect pension data that had been provided by the Defense Department.

Payne later sent out a letter explaining the error, which involved a mix-up in which tax years were covered by the settlement.

``Many [military retirees] called and knew how to resolve that themselves,'' Payne said.

Some state lawmakers worried that the computation error could be used to challenge the settlement that was signed into law by Gov. George Allen. But Attorney General Jim Gilmore said there was no need for a special legislative session to address the problem.

Federal retirees will receive a second notice, containing final settlement offers, by Dec. 15.

Taxpayers who meet the state deadline and provide the appropriate documentation should receive their first refund installment next year. The payments are to go out next March, Payne said.