Economic Stimulus Package
DEAR COLLEAGUE LETTER
DATE: February 22, 2008
TO: ALL STATE AND TRIBAL IV-D DIRECTORS
RE: Economic Stimulus Package
On February 13, 2008, the Economic Stimulus Act of 2008 became Public Law No. 110-185. The Act, in part, provides for additional refunds to be sent to most taxpayers. According to the Department of Treasury, an estimated 130 million rebates representing more than $100 billion will be processed. The Internal Revenue Service (IRS) and Financial Management Service (FMS) are preparing to process and mail these rebates and expect mailings to begin in May.
FMS has informed us that the additional refunds will be subject to offset under the Federal Offset Program and the conference report language specifically indicates that the credits are "subject to the refund offset provisions, such as those applicable to past-due child support under section 6402 of the Code." This means that you could see an increase in offsets beginning as early as May or June.
In addition, all non-TANF cases with past-due child support greater than $500, regardless of whether the child(ren) on the case are no longer minors, are now eligible for Federal tax refund offset. With these increased opportunities for additional offsets, it is important to ensure that your cases, as well as the arrears, are up to date.
We are working with the IRS and FMS to collect the maximum amount possible from the economic stimulus package for the families owed past-due child support. We are meeting with FMS in the near future to obtain additional information about the process including how they will handle injured spouse claims on joint returns. We will continue to provide information to you as it becomes available. The IRS will also post updates and periodic news releases to their website at www.irs.gov.
If you have any questions regarding the Federal Offset Program, please contact Scott Hale at (202) 401-5745 or firstname.lastname@example.org.
Office of Child Support Enforcement
cc: Regional Program Managers
ACF Regional Administrators