Holding Tax Payments for Child Support
Under federal law, parents who owe past-due child support may have their federal and state tax refunds reduced, or “offset,” to pay the past-due support.
The Oregon Child Support Program usually pays out the tax refund offsets for single filers the day after receipt. If the tax refund offset is from a joint tax return, we hold it for six months. Due to an issue with the IRS related to stimulus payments for joint filers, those payments may be held longer. This period allows tax authorities time to make adjustments, such as when a joint filer who does not owe support (known as an “injured spouse”)1 asks that a portion of the withheld payment be returned to them. See Oregon Administrative Rule 137-055-6021(1)(a).
In recent years, the Oregon Department of Revenue and Internal Revenue Service have increased their recall of tax refund offsets. These recalls may be due to a fraudulent tax return or an injured spouse claim made after the initial tax return is filed. When a tax refund offset is recalled but the payment was already disbursed, all parties on a child support case are financially burdened by the reversal, including other Oregon taxpayers.
If you have questions, please contact your local child support office.
1 If two spouses file a joint income tax return and one spouse has child support arrears, the spouse who does not owe the child support (referred to as the “injured spouse”) may file a claim for their share of the refund to be returned to them. This is referred to as an “injured spouse claim.”