If you owe certain debts and have a judgment against you, don't expect that refund check from the Internal Revenue Service. In a process known as interception, the IRS can apply your refund toward payments of particular debts. If you're in danger of an interception, you can reduce the withholding amounts on your paycheck so that an IRS refund intercept is less likely. Of course, you then might owe the IRS money.
If you've got a credit card or similar judgment against you, the IRS won't keep your refund. By law, it can only apply your refund to student loan defaults, child support judgments and income tax-related debt. The IRS notifies you before it keeps your money, so you have the opportunity to request a hearing or provide evidence that the debt is paid or is not the correct amount. When filing a joint return, remember that a refund can be partially intercepted by a debt owed by one of you.
- Thinkstock/Stockbyte/Getty Images
- Can Creditors Take Your Tax Refund if You Filed Jointly?
- Can Collection Agencies Garnish Your Income Taxes?
- Can Creditors Collect on a Canceled Consumer Debt?
- How to Contest Debt
- What If You Owe a Bill to the IRS?
- Reasons You Won't Get Your Federal Refund
- How to Avoid Bank Account Garnishments by a Debt Collector
- Does the IRS Apply Refunds Due to the Money Owed From Previous Years?