Did you know that if you owe money on past-due debts, you federal tax refund can be affected? Well it's true. Many of us look forward to receiving our tax refunds after the stressful tax season, but some may find their refund isn't everything they hoped for. Below is some information that you may find helpful if your tax refund has been affected.
1. Past-due child support can and will negatively affect your refund amount. Other popular causes for seized refunds are past tax debt, recent Chapter 13 bankruptcy, or student loans you have defaulted on.
2. If the Bureau of Fiscal Service (the organization in charge of tax refunds) takes some or all of the funds in your tax refund, you will receive a notice by mail shortly thereafter detailing your original refund amount, the offset amount, and the contact information of the agency that received your payment.
3. If you filed a joint tax return and your refund was affected, you should submit Form 8379, called the Injured Spouse Allocation Form, to request your portion of the refund. You may be entitled to some of the taken money.
The IRS can also hold your federal tax return. Holding the return is a different situation from seizing it altogether. The IRS can hold your tax return for several reasons, such as not filing taxes in previous years or mistakes on your tax return. You should contact the IRS for more information if your refund is held.
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