Saturday, March 13, 2010
State to seize refunds to pay off taxpayers' federal debts
The latest from The Ticker blog
Indebted taxpayers may see their state refunds shrink more than usual this year.
The Virginia Department of Taxation will seize any debts owed to the federal government from taxpayers' state refunds as part of an income tax levy program, which began in January.
As it has done for years, the state first will seize refunds to pay debts for state taxes, to other state agencies such as courts and to local governments. If there's a refund left over, that money then will be sent to pay off a taxpayer's federal debts.
"Basically there are four checkpoints that a refund has to pass through before it gets to a taxpayer," said Joel Davison, Virginia Department of Taxation spokesman. "If you're paying all your debts, you'll get all your money."
The state taxation department has collected $662,279 through the program, he said.
-- Katelyn Polantz
