How to Get Your IRS Offset Back

How to Get Your IRS Offset Back
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Taxpayers who lose a portion or all of their tax return to an Internal Revenue Service offset may be able to recover their offset funds. When a taxpayer owes an outstanding state or federal debt, the Internal Revenue Service can withhold his tax return to cover the outstanding obligation. A taxpayer's ability to recover her offset tax return depends on the filing status she uses to file her return, or the reason her tax refund is subject to an offset. In other instances, taxpayers who receive an offset cannot recover the withheld portion of their tax return.

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Step 1

Complete an injured spouse form, or a federal Form 8379 to get back your share of the offset if you filed a joint return with a spouse who owes a federal or state obligation. Married individuals whose spouse is subject to an Internal Revenue Service offset may also experience an offset if the couple files their taxes with the "married filing jointly" filing status. If the obligated spouse's tax return fails to cover his entire debt, the IRS will offset his spouse's portion of a joint tax return to cover the obligation. However, the non-obligated spouse can get back her portion of the offset by submitting the Form 8379. The Internal Revenue Service states that it could take up to eight weeks to receive the offset allocation. Injured spouses can find the Form 8379 at the IRS website.

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Step 2

Submit a statement of financial hardship to your loan guaranty agency or the Department of Education if you experience an IRS offset as a result of student loan default. Taxpayers who receive an offset due to delinquent student loans can recover a portion of the withheld funds or stop the withholding action altogether, if they can prove financial hardship. The loan guaranty agency or the Department of Education compares the applicant's expenses to those of households comparable in size and income to determine eligibility. The statement of financial status form is available at the Department of Education website.

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Step 3

File an offset appeal to recover all or a portion of your tax refund offset. Only individuals who experience an offset due to obligations such as delinquent child support or back taxes can appeal a tax refund offset after the IRS intercepts their tax return. However, the taxpayer can only appeal the offset in one of two ways: by showing that he is not the person who owes the debt or that the amount owed is incorrect. Otherwise, taxpayers who receive an offset due to reasons other than defaulted student loans or by being an injured spouse cannot get back their offset.

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