Offset of Tax Refund Payments To Collect Past-Due Support

Federal law authorizes the Federal tax refund of a taxpayer who owes past-due support to be reduced, or offset, by the amounts owed by the taxpayer. Past-due support includes delinquent child support or other obligations for the support of a child. The funds offset from a taxpayer's tax refund are forwarded to the State enforcing the collection of the past-due support. Effective January 1, 1999, the Department of the Treasury will conduct the tax refund offset program as part of the centralized offset program, known as the Treasury Offset Program, operated by the Financial Management Service (FMS), a bureau of the Department of the Treasury. This final rule establishes tax refund offset procedures that supersede the procedures governing the tax refund offset program established by the Internal Revenue Service (IRS) and applicable to the collection of past-due support (codified at 26 CFR 301.6402-5). Differences between this rule and the IRS rule reflect requirements necessitated by the inclusion of the tax refund offset program as a part of the Treasury Offset Program.