The U.S. Treasury and Social Security Departments are intercepting federal and state tax refunds because of alleged overpayments to taxpayers’ parents decades ago. The theory is that the children benefited from the overpayments, so they owe the money.
The intercepts mostly come without warning, and without the government providing any documentation that the money actually is owed. The first warning the taxpayer gets that there is a problem is when the tax refund check is intercepted.
Be that as it may, there is nothing in the law that requires or authorizes Treasury or Social Security to ignore due process of law. This is the decision of some unknown, unaccountable person hidden deep within the bureaucracy.
At the very least, taxpayers should be notified in advance as to just what the supposed overpayment was, and when and how it was made, and be given a chance to make an objection.
Experience tells me that unelected people in positions of authority in government seldom back down from mistakes. But since nobody in Congress stands behind the original enabling legislation, there should be no problem in repealing it. Should there?
The government is following the worst practices of mortgage foreclosure servicers and bill collection agencies, in acting without warning and with lack of documentation and due diligence to make sure they’ve got the right person and the debt is really owed.
I expanded this post somewhat a few hours after I published it.
[Update 4/15/14]
The U.S. Social Security Administration, criticized for seizing tax refund checks without notice based on debts of the taxpayers’ deceased parents, said it will stop trying to collect debts more than 10 years old.
That’s good first step. How about promising to use due process of law before trying to collect any debts? And how about observing the legal principle that children are not responsible for the debts of their parents?
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