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Can a tax refund be applied to child support arrears?

There are many different avenues the child support enforcement agency can attempt to collect funds from the payor to satisfy arrears, including garnishing wages and lottery winnings and intercepting a federal tax refund. Taking a tax refund can help get the payor caught up more quickly than just taking an extra percentage out of the regular income, especially if the expected tax refund is significant.

While this may also be a benefit to the payor since it does not further reduce the net income from the primary employment, there are several things for the party receiving the child support payments to be aware of. The most important of these is that it can take several months for an intercepted tax refund to actually go through the child support enforcement agency and be disbursed to the payee.

This is because tax refunds must be held until the applicable agencies can ensure the income tax filing, and therefore the tax refund, was correct. If the funds were disbursed immediately and the filing was later deemed to be fraudulent, it would put the payee in the very difficult position of trying to refund the money to the Internal Revenue Service.

Whether you are the parent paying child support or the one receiving the monies, it's important to have a complete understanding of how tax refunds are used to help pay child support arrears. Talking with a family law attorney early on in the process can help you know what to expect and how long you may have to wait for the funds to be officially applied to the child support account.

Source: Florida Department of Revenue, "IRS Tax Refund Offset," accessed Dec. 16, 2015

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