Intercepting Tax Refunds When a Parent Fails to Pay Child Support

By: LawInfo

Published: 11/2008

It seems only fair that if a parent is entitled to a tax refund, and he or she owes back child support, then back child support ought to be paid off first. For that reason, federal law provides that if a parent owes back child support, then a state child support office can intercept that parent’s tax refund for you and apply it to the back child support. Even if the child for whom child support is owed is now emancipated, a parent’s tax refund can still be applied to the back child support that he or she owes.

In order to qualify to receive the other parent’s tax refund for back child support, you need to make sure that you are enrolled in your state’s tax intercept program, which you can do by contacting your local child support office. If you or your child receives public assistance, then your local child support office’s services are generally free. Otherwise, you will have to pay up to $25.00 for an application fee. In some states, private attorneys also can obtain court orders requiring that parent’s state or federal tax refund be applied toward his or her back child support.

The federal tax intercept program also applies if the federal government issues stimulus payments to taxpayers, such as it did in the year 2008. This type of tax payment also can be intercepted and applied to a parent’s back child support.

Likewise, many states have state tax intercept programs, which essentially work the same way as the federal tax intercept program. State child support offices can intercept parents’ state tax refunds, and apply them to back child support. Those states that do not assess income tax, of course, would not have a state tax intercept program.

If a parent who owes child support is remarried, however, their tax refund might not be applied to back child support. If the parent and his or her new spouse has filed a joint tax return, and part of the tax refund is due to the new spouse’s income, the new spouse is entitled to his or her portion of the tax refund. In order to get that portion of the tax refund, the spouse must file an “injured spouse” form with the Internal Revenue Service (“IRS”). For this reason, joint tax refunds are held by state child support offices for six months before they are applied to back child support.

Tax refunds intercepted for back child support are first applied to back child support that has been assigned to the state, such as for periods when public assistance was drawn, and child support was not being paid. Once any balances owed to the state are paid off, the refund is applied to back child support that is owed to the other parent.

If the parent owes certain other government debts, such as federal student loans or federal income tax, the parent’s tax refund will go to pay those debts before back child support is paid. Additionally, the tax intercept program doesn’t help much when a parent doesn’t file his or her taxes, or isn’t entitled to a tax refund, which can happen for various reasons.