Tax Intercepts
Role of the Tippecanoe County Title IV-D Program in Tax Intercepts
If a non-custodial parent has accumulated an arrearage on his or her child support order, all or part of his or her Federal and State income tax refunds may be intercepted and applied to the child support arrearage.
Our office notifies the Internal Revenue Service and Indiana Department of Treasury of non-custodial parents who owe child support arrears and the amounts of those arrears. That is the only role we play in tax intercepts, however. Our office does not participate in the interception or the distribution of the refund. Those actions are controlled exclusively by the Internal Revenue Service and Indiana Department of Treasury, working with the Indiana Child Support Bureau.
Our office does not have access to information about whether tax refunds will be intercepted, when they will be intercepted, to whom the money will be distributed, or when it will be distributed. In addition, we cannot discuss tax refunds or interceptions with anyone other than the taxpayer. This means we cannot provide any information to the custodial parent about the non-custodial parent's tax refunds.
Federal Tax Intercept
To be subject to the interception of a Federal tax refund, a non-custodial parent must have accumulated an arrearage of at least $150, for cases in which there is money owed to the state, or $500, for cases in which all of the arrears is owed to the custodial parent.
State Tax Intercept
To be subject to the interception of an Indiana tax refund, a non-custodial parent must have accumulated an arrearage of at least $150, regardless of whether the money is owed to the state or to the custodial parent.
Notification
A non-custodial parent will receive a notice from the Internal Revenue Service prior to the interception of a federal tax refund. The non-custodial parent will receive a notice from the Indiana Department of Revenue prior to the interception of a state tax refund. This notice alerts the non-custodial parent to the fact that he or she has accumulated a child support arrearage sufficient to subject him or her to the interception of tax refunds. The notice will contain the identification of the child support case and the amount of arrears owed.
If a non-custodial's tax refund is larger than the amount of child support arrears owed at the time the refund is intercepted, only the amount needed to satisfy the child support arrearage will be kept by the Child Support Bureau, and the remainder will be refunded to the non-custodial parent. If the non-custodial parent does not owe any child support arrears by the time the tax refund is intercepted, the entire amount will be refunded to the non-custodial parent.
Holds
Usually, a hold is placed on intercepted federal tax refunds once they are received by the Child Support Bureau in Indianapolis. This hold can last up to five months. Sometimes a tax refund that has been intercepted and is on hold will be recalled by the IRS to pay another obligation, such as back taxes owed by the non-custodial parent.
If a non-custodial parent has accumulated an arrearage on his or her child support order, all or part of his or her Federal and State income tax refunds may be intercepted and applied to the child support arrearage.
Our office notifies the Internal Revenue Service and Indiana Department of Treasury of non-custodial parents who owe child support arrears and the amounts of those arrears. That is the only role we play in tax intercepts, however. Our office does not participate in the interception or the distribution of the refund. Those actions are controlled exclusively by the Internal Revenue Service and Indiana Department of Treasury, working with the Indiana Child Support Bureau.
Our office does not have access to information about whether tax refunds will be intercepted, when they will be intercepted, to whom the money will be distributed, or when it will be distributed. In addition, we cannot discuss tax refunds or interceptions with anyone other than the taxpayer. This means we cannot provide any information to the custodial parent about the non-custodial parent's tax refunds.
Federal Tax Intercept
To be subject to the interception of a Federal tax refund, a non-custodial parent must have accumulated an arrearage of at least $150, for cases in which there is money owed to the state, or $500, for cases in which all of the arrears is owed to the custodial parent.
State Tax Intercept
To be subject to the interception of an Indiana tax refund, a non-custodial parent must have accumulated an arrearage of at least $150, regardless of whether the money is owed to the state or to the custodial parent.
Notification
A non-custodial parent will receive a notice from the Internal Revenue Service prior to the interception of a federal tax refund. The non-custodial parent will receive a notice from the Indiana Department of Revenue prior to the interception of a state tax refund. This notice alerts the non-custodial parent to the fact that he or she has accumulated a child support arrearage sufficient to subject him or her to the interception of tax refunds. The notice will contain the identification of the child support case and the amount of arrears owed.
If a non-custodial's tax refund is larger than the amount of child support arrears owed at the time the refund is intercepted, only the amount needed to satisfy the child support arrearage will be kept by the Child Support Bureau, and the remainder will be refunded to the non-custodial parent. If the non-custodial parent does not owe any child support arrears by the time the tax refund is intercepted, the entire amount will be refunded to the non-custodial parent.
Holds
Usually, a hold is placed on intercepted federal tax refunds once they are received by the Child Support Bureau in Indianapolis. This hold can last up to five months. Sometimes a tax refund that has been intercepted and is on hold will be recalled by the IRS to pay another obligation, such as back taxes owed by the non-custodial parent.