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Federal Tax Offset

Legal Authority for Federal Program Referrals & Safeguarding Information Procedures

General Information

All child support staff, contractors and others who have access to Federal Tax Information (FTI) are required to complete the annual Safeguarding training to be made aware of certain disclosure requirements.  The training is to be done upon employment and thereafter by April 15 of each year.

The IRS website has an excellent Disclosure Awareness video for government agencies with transcript.  Each individual staff member can also complete the training online via the Learning Management System under Child Support Services, Safeguarding IRS Information.

Referral Criteria

All the above listed types of federal administrative offsets will refer on cases with active status (02, 06, 08, or 10).  Principal and interest balances are referred and there does not have to be a minor child on the case.

IRS Tax Refund Intercepts

TANF REQUIREMENT – $150 past due

Non-TANF REQUIREMENT – $500 delinquency

Administrative Debt Offsets

REQUIREMENT:  Debt must be 30 days old and at least $25 delinquent (currently limited to federal salary and retirement pay and vendor payments, including travel reimbursement)

Debt Check Offsets

REQUIREMENT:  Non-TANF – $500 delinquency

(funds offset from Federal loans, loan insurance, and loan guarantees)

Basic Information

Referrals

Referrals for all qualifying cases are sent to OCSS, FMS, IRS and Department of State (passports) once each year.  After the annual submission, additional cases are sent as they qualify.

Pre-Offset Notice

After the referral, but before the offset, NCPs are sent a “pre-offset notice”.  The notice is sent by OCSS and refers NCPs to their local child support office to make arrangements to resolve the debt prior to any offset of funds.

Single Returns

(Non-AFDC collections) are pended from issuance for at least 30 days.

Joint IRS Returns

(Non-AFDC collections) are pended from issuance for at least 180 days.

Active Outgoing Referral

When there is an active outgoing referral a CSENet transaction will be generated for an IRS collection to inform the other state of this intercepted collection.