Each year, some taxpayers file their returns expecting a refund, only to discover that it has been reduced or withheld. If you have unpaid federal or state tax debts—including past-due child support—the IRS has the legal authority to apply your refund toward those obligations.
For many, a tax refund is crucial for covering essential expenses, and losing it can create financial hardship. However, there may be a way to prevent this. The National Taxpayer Advocate (NTA) recommends that eligible taxpayers request an Offset Bypass Refund (OBR) if they can prove economic hardship. This process must be initiated before the IRS applies your refund to your debts, so it's crucial to act quickly.
If you think you qualify for an OBR, gather the necessary documentation now to support your claim. Don’t wait until your refund is gone—be proactive and protect your finances.
Need expert tax guidance? Verity CPAs can help you navigate complex tax issues and find the best solutions for your situation. Contact us today at info@verity.cpa or 808.546.5026.
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