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The Almighty Buck Government United States Politics

IRS Can Now Seize Your Tax Refund To Pay a Relative's Debt 632

Posted by Unknown Lamer
from the dead-...-beat-relatives? dept.
Hugh Pickens DOT Com (2995471) writes "Just in time for the April 15 IRS filing deadline comes news from the Washington Post that hundreds of thousands of taxpayers expecting refunds are instead getting letters informing them of tax debts they never knew about: often a debt incurred by their parents. The government is confiscating their checks, sometimes over debts 20—30 years old. For example, when Mary Grice was 4 (in 1960), her father died ... 'Until the kids turned 18, her mother received survivor benefits from Social Security ... Now, Social Security claims it overpaid someone in the Grice family in 1977. ... Four years after Sadie Grice died, the government is coming after her daughter. ... "It was a shock," says Grice, 58. "What incenses me is the way they went about this. They gave me no notice, they can't prove that I received any overpayment, and they use intimidation tactics, threatening to report this to the credit bureaus."' The Treasury Department has intercepted ... $75 million from debts delinquent for more than 10 years according to the department's debt management service. 'The aggressive effort to collect old debts started three years ago — the result of a single sentence tucked into the farm bill lifting the 10-year statute of limitations on old debts to Uncle Sam.'"
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IRS Can Now Seize Your Tax Refund To Pay a Relative's Debt

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  • by epyx (162239) on Monday April 14, 2014 @09:12PM (#46752801)
    The IRS has already stopped collecting these old debts, but let's not let that get in the way of a good political rant..

    http://www.forbes.com/sites/ro... [forbes.com]
  • by artor3 (1344997) on Monday April 14, 2014 @09:12PM (#46752803)

    They cancelled this policy [nytimes.com] almost immediately after it was brought to light.

  • by artor3 (1344997) on Monday April 14, 2014 @09:14PM (#46752821)

    FYI, they've cancelled the policy and are encouraging people targeted by it to contact them for a refund.

  • by Anonymous Coward on Monday April 14, 2014 @09:22PM (#46752887)

    Do you have any teeth left at all after your knee impacted your chin?

    I don't get it?

    He had a knee-jerk reaction. GP implies it was so severe that his knee made it all the way to his chin and knocked out some teeth.

  • by Phil-14 (1277) on Monday April 14, 2014 @09:27PM (#46752921)

    I just checked Wikipedia, according to which Bush vetoed the linked "Food, Conservation, and Energy Act of 2008" on May 21, 2008, and had the veto overridden the same day, by a Congress run by Nancy Pelosi and whoever was Senate leader then. (checking... oh, Harry Reid). While I am anxious to find out which Republicans did vote for that bill, it looks like Bush didn't.

    If that's the wrong bill I'd like to know about it, since they seem to be linking to it in every story I see on this issue.

  • by cirby (2599) on Monday April 14, 2014 @09:32PM (#46752965)

    Yeah, those darned conspiracy theorists, all crazy and stuff - complaining about a policy that was stupid and evil.

    But now that it hit the news and EVERYONE said it was stupid and evil, the government has stopped doing the stupid, evil thing.

    So those people are now wrong and crazy.

    Until the government starts doing it again.

  • by the eric conspiracy (20178) on Monday April 14, 2014 @09:42PM (#46753031)

    This has been going on for a while. And while it's stopped right now, it's only under review.

    This sort of collection should be limited to the actual recipients, and have some sort of statute of limitations.

    Commercial debt dies with the probate process. It's not passed on.

  • Re:Over 18 (Score:5, Informative)

    by Opportunist (166417) on Tuesday April 15, 2014 @12:55AM (#46753881)

    Yes, but at least you could forgo it and deny inheriting it. In this case, you inherit your relatives' debt without a chance to avoid this.

  • by AthanasiusKircher (1333179) on Tuesday April 15, 2014 @12:58AM (#46753901)

    The real question is who added this particular provision, and are they still in office? I'm not sure how to dig up that crucial bit of info.

    This takes a bit of digging. I believe the provision in question is H.R. 2419, Sec. 14219. "Elimination of statute of limitations applicable to collection of debt by administrative offset."

    It was added as part of a list of amendments suggested by a committee report (House Report 110-261 [gpo.gov]). The specific amendment regarding the statute of limitations was entered into the Congressional Record at H9049 [gpo.gov].

    The slate of amendments (H.Amdt.714) from the report were introduced to a full house vote (see Congressional Record H8763) by Rep. Collin Peterson (Minnesota 7th), then chairman of the House Agricultural Committee. Rep. Peterson should probably not be taken to be the main proponent of this measure, since this was part of a slate of amendments introduced in the committee report, which were then offered up to the full house for approval. (A number of members of the Agricultural Committee spoke for this slate of amendments, though it doesn't seem anyone spoke in support of the specific provision for eliminating this statute of limitations -- this provision was included among a whole bunch of other random things in the bill.)

    The specific amendment (the 29th on the slate to be considered) did not actually name the elimination of statute of limitations sections as its primary purpose (listed as Sec. 3005, the "Reauthorization of McGovern-Dole International Food for Education and Child Nutrition Program"), so one might argue that this section was buried as an added clause within an amendment which was buried within a slate of amendments.

    In any case, the house agreed to these amendments offered en bloc by voice vote on July 27, 2007, so there's no record of who voted for or against (though the assumption is it was more-or-less unanimous, since it was approving something recommended from the committee who was trying to produce a bill which could be passed by the full house).

    (Of course, as is typical, the amendment was not actually read in full to the house, and only entered later into the Congressional record as an "omission" for the day, which is why the page number for the amendment is later than the page on which it is approved.)

    It's possible you might find something about who actually wanted this provision by digging into records of committee meetings, but I somewhat doubt it. This slate of amendments was part of an ENORMOUS bill, and it looks like this list of amendments was a compiled list of crap the committee needed to put in just to get it to the next stage of legislation.

  • Re:Over 18 (Score:5, Informative)

    by belmolis (702863) <billposer AT alum DOT mit DOT edu> on Tuesday April 15, 2014 @01:37AM (#46754085) Homepage
    Actually, no. The debts of the deceased are paid out of the estate. The heirs are paid out of the remainder of the estate. The heirs do not inherit the debt. If the estate is not sufficient to satisfy the debt, the heirs may receive nothing, but they never inherit any debt.
  • Re:Over 18 (Score:5, Informative)

    by belmolis (702863) <billposer AT alum DOT mit DOT edu> on Tuesday April 15, 2014 @01:42AM (#46754099) Homepage
    No. The heirs are not responsible for the debts of the estate. The debts are paid by the executor out of the assets of the estate. The heirs are paid out of what remains of the estate. If the debts exceed the assets, the heirs receive nothing, but they do not assume any part of the debt.
  • Re:Over 18 (Score:5, Informative)

    by thebryce (1076543) * on Tuesday April 15, 2014 @11:34AM (#46757913)

    the offending language in Sec. 14219 of the farm bill seems to first appear in H.R. 6124, Food, Conservation, and Energy Act of 2008 [house.gov] which was sponsored by Rep. Collin C. Peterson, D-Minn.

    Send him a message here: http://collinpeterson.house.go... [house.gov]

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