Tax Refunds can be taken by both the state of Iowa Department of Revenue and by the Internal Revenue Service. Your refund can be taken for a number of different debts including past due taxes, child support, benefits overpayment such as Social Security or unemployment, court fines, or student loan debt. What you can do about it, depends on what agency took the refund and why it was taken.
Did you file a Joint Return with your spouse? If yes, is it your debt, your spouse’s, or a joint debt?
Federal Refund-If the debt is only your spouse’s debt, you can file a Form 8379 to get your share of the refund. To be entitled to a share, you must have reported income, had income tax withheld, and/or qualify for a tax credit.
Iowa Refund-There is no “injured spouse” form. You have to file married filing on a separate form to keep from losing your state refund for a spouse’s debt.
Who do I contact?
- If the debt is not taxes and your federal refund was taken:
You should get a letter with a telephone number for Federal Payment Management System. This office will be able to tell you what agency took your refund and how to contact that agency. If you don’t get a letter, you can call the IRS general number at 1-800-829-1040.
- if money is owed to the state of Iowa:
The Iowa agency responsible for the seizure should send you a letter explaining why your refund was withheld. You can call the Iowa Department of Revenue at 1-800-367-3388 with questions.
- if federal tax is owed:
You may call the Internal Revenue Service-1-800-829-1040 for more information about the debt. If you owe the debt but losing your refund will result in an economic hardship, the Taxpayer Advocate Service (TAS) may be able to help get all or a portion released. Hardships that may qualify include evictions, foreclosures and utility shut-offs. The TAS number is 1-877-777-4778.
At the federal and state levels, the agency that took your refund will have rules about when and what allows you to challenge the seizure. Usually there are very short deadline windows to request a hearing or review.
Where can I get legal help if I cannot resolve the tax refund matter on my own?
If you have questions about your tax rights and responsibilities, Iowa Legal Aid’s Low-Income Taxpayer Clinic may be able to help.
To apply for help from the Low-Income Taxpayer Clinic contact Iowa Legal Aid.
As a general rule, Iowa Legal Aid’s Low-Income Taxpayer Clinic does not prepare tax returns.