The IRS can offset your tax refund for delinquent child support as part of the Treasury Offset Program (TOP). Your entire refund may be levied or it may be reduced to pay the past-due child support.
Treasury Offset Program
The TOP allows tax refunds to be seized to pay both tax and non-tax debts, including:
- State income tax debts
- Certain unemployment compensation debts owed to a state
- Federal agency non-tax debts
- Past-due child support
The agency you owe the debt to will report your information to the U.S. Treasury Department, which will then determine if the debt qualifies for the TOP.
You should receive a notice before the offset occurs notifying you that your refund may be seized. If you disagree with the offset or want to work out a resolution, you’ll need to contact the agency listed on the notice. The IRS isn’t responsible for administering the TOP.
You can also avoid the refund offset by paying the amount off in full before your refund is seized.
Other federal payments are also eligible for the TOP, so it’s possible that your Social Security benefits or other payments could be seized to pay back child support.
Avoiding Refund Offsets
If you don’t dispute the amount owed, you most likely will not be able to avoid the tax refund offset. You could reduce your tax withholding so that you don’t receive as large of a refund next year.
If your refund is being offset because of your spouse’s debt incurred before you were married, you have two options for avoiding the refund offset:
- Use the Married Filing Separately filing status. Your spouse’s refund will be seized, but yours will not. Keep in mind that you may not qualify for certain tax breaks if you file separately.
- You can file jointly and submit an injured spouse allocation. This allows the IRS to seize only a portion of the refund. You’ll receive the portion of the refund that is allocated to your tax items.
If you don’t do either of these things, the IRS will seize your entire joint tax refund, up to the amount your spouse owes in back child support.
The Gartzman Law Firm offers tax settlement help for both federal and state tax debt. Use our contact form to request a consultation with an Atlanta tax resolution attorney.