If you’re behind on child support, the government will attempt to collect the payments in whatever way possible. This will include garnishing our wages and seizing your tax refunds.
There are several ways to stop the state and federal governments from taking your tax refunds including contacting your local Department of Child Support and Enforcement (DCSE) agency to file an appeal, setting up a payment plan for your delinquent payments, and requesting a hearing.
Ways to protect your tax refund
Contact your local DCSE agency
The division of Child Support and Enforcement is responsible for collecting child support but will hear appeals/good cause reasons for being arrears. Reasons for good cause changes to child support includes losing a job, the other parent getting a significant raise, or disability of the paying parent.
Set up a payment plan
Payment plans allow you to catch up on your late payments over time, but you will be charged interest. However, if a payment plan is in effect (and you are current on the payments) then your refund will not be seized.
Request a hearing
If you have an outstanding request for a hearing, DCSE may not seize your tax refund. The hearing will give you a chance to present your case for being delinquent on your payments and your plan for getting caught up. They may also take into consideration your reasons why you need your tax refund.
Pay the delinquent amount due
If you get caught up on your child support payments, the government will not take your refund. To make sure that they do not take your refund, you’ll want to make sure that you are caught up well in advance of your expected refund processing date.
Can child support take the advanced child tax credits?
Under the American Rescue Plan in 2021, advanced child tax credit payments were issued during the second half of 2021. This bill stated that the payments were not subject to seizure by the government for delinquent child support.
It is unknown whether the IRS will restart the advanced child tax credit payments in the future and whether they would be subject to seizure.
How can child support take my tax refund for child support?
The federal tax refund offset program started in 1981 and gives the IRS and state tax authorities the right to seize your refunds to pay delinquent child support. If the IRS intends to seize your refund, you will receive a notice in advance that you are on the list of refunds to be seized. If the amount you owe is less than your expected refund, the IRS may only withhold part of your refund.
If the IRS has an outdated address on file, you may not receive timely notice of their intent to seize your refund. Even if you do not receive the notice, the IRS still has the right to take it.
Can child support take my state tax refund?
Just like the IRS can pass your tax refunds on to the DCSE to pay delinquent child support payments, states can also seize your state tax refund to pay child support. The rules vary for each state, so you should check with your state agency.
Most states sent out notices prior to seizing a tax refunds for delinquent payments although the policy varies by state.
Does child support ever let you have your tax refund if you have delinquent child support?
The IRS stopped seizing tax refunds during 2020 and 2021 due to the COVID pandemic. This is the first time since 1981 that they have stopped seizing refunds for delinquent child support payments. It is unknown if they will continue to provide a waiver in future years.
During this period, many states also stopped seizing tax refunds to pay arrears child support, although each state differed in the amount of time they pause their policy of capturing refunds.
Are child support payments tax deductible?
Paying or receiving child support payments is not a taxable event. The child support payments are not deductible for the person paying the child support. They are not income for the person receiving the child support.
This differs from alimony payments which are deductible for agreements entered into prior to January 1, 2019. Divorce and separation agreements should differentiate between child support payments and alimony.
What other ways does delinquent child support affect my finances?
There are several ways that having delinquent child support may affect your finances. If you willfully refuse to submit payments, you may be held in contempt and be jailed which lowers your earning power.
If you are gainfully employed, DCSE may garnish your wages which means that they take a certain percentage or fixed dollar amount from each of your paychecks. Delinquent child support payments may be reported to the credit agencies and lower your credit score which lowers your ability to obtain a loan.
Questions about the child support services taking your tax money? We have the answers.
Claiming a child on your tax return is unrelated to the amount of child support you pay or receive.
You can change your child support amount by petitioning the court to update your support agreement. You also negotiate with the child’s other parent to file a change motion.
Each state’s child support agency reports delinquent accounts to the IRS. The IRS compiles a list of delinquent accounts and sends out notices to anyone whose refund is at risk of being seized.
To avoid this situation, all child support payments should be paid through DCSE so that there is an official record of the payment.