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How To Avoid a Child Support Tax Refund Offset if You File Jointly

Ruchi Gupta - Author
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Feb. 25 2022, Published 8:45 a.m. ET

If you’re behind on child support payments, the IRS might seize your tax refund. Here's how to avoid that.

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Child support cases can disrupt your financial plans and impact your credit score. The court may order you to make monthly payments toward your child’s maintenance, and skipping a payment puts you in debt. Job loss or other financial challenges can sometimes leave you with no choice but to forego child support.

Filing returns jointly with a spouse who owes child support that you’re not responsible for can also complicate matters for you. Therefore, it might make sense to file as single even though you’re married.

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How does the tax refund offset program work?

If you have a past-due child support payment, you’ll receive a notice informing you that all or part of your tax refund will be intercepted to offset your arrears. The notice shows the amount you owe and other details related to your support obligations. Remember that the actual amount taken from your refund may be greater than the amount shown in the notice. This happens if you continued to be in arrears and the debt grew from the date of the notice to the time the deduction happens.

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What to do if you receive tax refund offset notice

Don’t ignore the notice, because doing that could put you in more trouble. Instead, take action immediately you receive the notice, because you might be able to reduce its impact on your finances before it’s too late.

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If you can, pay the arrears in full as soon as possible. If your financial condition can’t allow you to clear the debt, get in touch with your local child support agency. You might get help. Alternatively, go back to the court and seek to adjust the support amount to accommodate your current financial situation.

How to stop child support from taking tax refund

Aside from clearing the arrears, there may be little else you can do to prevent your tax refund from going to child support offset program. However, an offset isn’t automatic, even if you’re in arrears. For example, if the child support recipient gets state benefits, then your arrears must be at least $150 before you can be subject to refund seizure. If the recipient doesn’t get state benefits, your refunds can only be due for capture if you’re at least $500 in arrears.

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There are other avenues you may pursue to prevent your refunds from being intercepted. You may have a strong argument to contest the seizure if you believe you’ve been a victim of identity theft and the debt doesn’t belong to you. You may also be able to avoid the offset if you have a permanent disability.

If you file returns jointly with a spouse who owes child support debt that you’re not party to, you can tell the IRS about it by filing an injured spouse allocation form. If the IRS accepts your request, your portion of the refund would be exempt from the offset.

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