Think You"ll Get Past Due Child Support Through the IRS Tax Offset? Maybe Not!
Getting the financial support that your child deserves can be a draining ongoing battle for many custodial parents.
However lets make something very clear, financial child support is the legal right of a child.
If you are a custodial parent who has a legal court order that established a set financial obligation from the non-custodial parent and that parent is behind in their support obligation - there may be some help coming your way! The state and federal government take the financial responsibilities of a parent to their children pretty seriously, even if the non-custodial parent has manage to dodge the system all year long - tax season represents the one time of year where many parents receive lump sum payments due to the IRS tax offset program.
Now determining whether or not you will receive a tax offset will vary depending on the state you live in.
Here are a few things you should know: 1.
What is a tax offset?: The federal income tax offset program is a program enacted by congress to collect delinquent child support via the IRS tax refund of the obligor.
The obligor is typically the non-custodial parent, or the one who has been ordered to pay child support.
The child support tax offset program involves several groups or agencies, including your local child support agency, the state, the federal Office of Child Support Enforcement and the federal government IRS agency.
2.
How do I collect arrears through a tax offset?: While the specifics of this will vary from one state to the next, if the non-custodial parent has incurred arrears - then your case may be eligible for a tax refund intercept.
Now as I said before, certain aspects the collection process differ from one state to the next.
Generally speaking, the non custodial parent needs to be behind by a certain dollar amount or a certain amount of time.
Most states require a minimum of $500 in arrears or a total of 4 consecutive payments behind.
If your case meets that threshold, then your local child support agency will need to inform the federal IRS agency of their request for an IRS refund offset or intercept.
Now some states of automated this process and will do initiate the offset on your behalf on their own.
With other states, you may need to notify the court officer who handles your case and that will prompt them to begin the process.
If you have any doubts, it is best to call your state child support hot line with questions.
It's important to do before the start of tax season, if you wait too long, it may be too late.
3.
I didn't get an offset, why not? : If your case qualifies for a tax offset, and your state has requested one on your behalf - but yet it was not collected or received - there could be one of several reasons to explain this.
The tax offset program also collects on behalf of other agencies as well, including the Department of Education for federally funded student loans, IRS collections, state welfare programs, and some bank held liens as well.
Child support debt may sometimes fall lower on the collection scale depending on the individual situation.
For example, welfare debt and student loan offsets will always be collected first.
Lets say the non-custodial parent in your case is set to receive a refund in the amount of $1400, they are $1200 behind in child support, but they also have an offset of $1300 for a student loan debt.
The entire student loan debt will be collected first and the remaining will be sent to you.
If the non-custodial parent filed jointly with a new-spouse, there is a 6-month "hold" put on the intercept.
Under federal law, the new spouse has the right to be refunded the portion that is legally theirs.
This 6 month grace period is put in place to allow the new spouse to go through the appropriate channels to get their portion returned to them.
So in this case, monies will still be collected on your behalf, however it will be less the new spouses portion and may be held in limbo for as long as six months.
If the new spouse does not file their claim within that 6 months, they will forfeit the rights to it, and you will receive the refund in full.
However lets make something very clear, financial child support is the legal right of a child.
If you are a custodial parent who has a legal court order that established a set financial obligation from the non-custodial parent and that parent is behind in their support obligation - there may be some help coming your way! The state and federal government take the financial responsibilities of a parent to their children pretty seriously, even if the non-custodial parent has manage to dodge the system all year long - tax season represents the one time of year where many parents receive lump sum payments due to the IRS tax offset program.
Now determining whether or not you will receive a tax offset will vary depending on the state you live in.
Here are a few things you should know: 1.
What is a tax offset?: The federal income tax offset program is a program enacted by congress to collect delinquent child support via the IRS tax refund of the obligor.
The obligor is typically the non-custodial parent, or the one who has been ordered to pay child support.
The child support tax offset program involves several groups or agencies, including your local child support agency, the state, the federal Office of Child Support Enforcement and the federal government IRS agency.
2.
How do I collect arrears through a tax offset?: While the specifics of this will vary from one state to the next, if the non-custodial parent has incurred arrears - then your case may be eligible for a tax refund intercept.
Now as I said before, certain aspects the collection process differ from one state to the next.
Generally speaking, the non custodial parent needs to be behind by a certain dollar amount or a certain amount of time.
Most states require a minimum of $500 in arrears or a total of 4 consecutive payments behind.
If your case meets that threshold, then your local child support agency will need to inform the federal IRS agency of their request for an IRS refund offset or intercept.
Now some states of automated this process and will do initiate the offset on your behalf on their own.
With other states, you may need to notify the court officer who handles your case and that will prompt them to begin the process.
If you have any doubts, it is best to call your state child support hot line with questions.
It's important to do before the start of tax season, if you wait too long, it may be too late.
3.
I didn't get an offset, why not? : If your case qualifies for a tax offset, and your state has requested one on your behalf - but yet it was not collected or received - there could be one of several reasons to explain this.
The tax offset program also collects on behalf of other agencies as well, including the Department of Education for federally funded student loans, IRS collections, state welfare programs, and some bank held liens as well.
Child support debt may sometimes fall lower on the collection scale depending on the individual situation.
For example, welfare debt and student loan offsets will always be collected first.
Lets say the non-custodial parent in your case is set to receive a refund in the amount of $1400, they are $1200 behind in child support, but they also have an offset of $1300 for a student loan debt.
The entire student loan debt will be collected first and the remaining will be sent to you.
If the non-custodial parent filed jointly with a new-spouse, there is a 6-month "hold" put on the intercept.
Under federal law, the new spouse has the right to be refunded the portion that is legally theirs.
This 6 month grace period is put in place to allow the new spouse to go through the appropriate channels to get their portion returned to them.
So in this case, monies will still be collected on your behalf, however it will be less the new spouses portion and may be held in limbo for as long as six months.
If the new spouse does not file their claim within that 6 months, they will forfeit the rights to it, and you will receive the refund in full.
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