Delinquent taxpayers may find smaller state refund checks

Erin Smith Staff writer

March 9, 2014

ELIZABETHTOWN — With tax time looming, folks are scrambling to get their shoe boxes filled with a year’s worth of receipts to their tax preparer in the hopes of receiving a windfall of sorts in the form of a refund.

But folks need to be aware that their state refund check can be garnished for past due taxes, according to Bladen County Tax Administrator Chris Ellis.

“The county can only garnish your state refund,” said Ellis. He added they are not allowed to intercept your federal refund.”

Ellis said that the county can garnish an income tax refund check for 2012, 2011, 2010,2009, etc. But as of Jan. 7, the 2013 property taxes are now delinquent.

“We advertised last Friday (Feb. 28) and this Friday (March 7) that Friday, March 14, is the last day to pay before your name goes into the paper,” said Ellis.

He added that the county can garnish your wages, state tax refund checks and so forth as a means to collect past-due property taxes.

Ellis said what happens when the county exhausts other means to collect past-due taxes, they will submit the individual’s and/or co-owners’ social security number(s) and the amount owed to a company called Five Star Clearinghouse. The company will take the information and forward it to the IRS.

“They will input it in the system so we can intercept the taxes,” said Ellis.

He added that if there is no social security number available, there is software that the county can use to locate a social security number if the need should arise.

There is a fee that is charged by the clearinghouse and IRS. Ellis said the county does not charge a fee and does not receive the fee. The only amount the county receives is the amount that is owed in delinquent taxes. The fees are distributed to the IRS and clearinghouse. The fee is $15 for the clearinghouse and $5 for the IRS.

“We only tell the clearinghouse the amount owed when we go to intercept money,” said Ellis.

He added that other agencies such as EMS, the health department and water department can also garnish income tax refunds if the amount owed is large enough.

“The minimum you can owe before your income tax is intercepted is $50,” said Ellis.

He added that there is supposed to be a letter sent by the clearinghouse to the individual notifying them that a garnishment has taken place and gives them a telephone number they can call to learn more information about the garnishment. Ellis added he had also heard from folks who had their tax refunds garnished and did not receive the letter.

He added that on the back of your property tax bill is a wealth of information including the garnishment of income tax refunds, programs for those over 65 years old, and more.

Ellis added if your taxes are delinquent and you come in and pay, don’t fret.

“We send the information to the IRS at the first of the year (regarding those that are being garnshied),” said Ellis. “Sometimes folks will come in and pay later. So, by then, their income taxes still get intercepted because we’ve already submitted the information two months ago. If we intercept their income taxes and they don’t owe because they have already paid, we will send it (the income tax amount intercepted) to the tax payer.”

He added that process could take several weeks.