If you are an Ohioan taxpayer and owe certain debt, you may receive a letter stating your state tax refund is subject to offset. In most cases, the agencies that are eligible to intercept your refund provide many opportunities for you to become current on your bill prior to placing your account with the state for offset. In most cases, it is not possible to receive your tax offset funds following the intercept, unless you have already paid your bill in full.
Ohio Tax Offsets
An Ohio tax offset occurs when the state uses your tax refund to pay certain outstanding debt you have. If you receive an Ohio tax offset, you will receive a letter explaining that your refund has been offset and the state agency that is receiving your refund instead. If your refund is more than the amount you owe to the agency listed in your offset letter, you will receive the balance of your refund after the state debt amount is deducted.
If you owe past due child support, your case worker will refer your case for offset if your arrears balance is between $150 and $500. If the parent receiving child support is on public assistance, your refund is offset when your arrears balance is at least $150. Your refund is sent to the county, which pays the obligee parent cash assistance benefits. If the parent receiving child support is not on public assistance, your Ohio refund is offset when you owe at least $500 in arrears. The state sends the money from your refund to the parent who receives support.
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State Benefit Repayment
If you receive workers' compensation benefits and are overpaid, your Ohio tax refund will be offset to repay the amount of overpayment you received from the benefit plan. Your offset funds are sent to the Ohio Bureau of Workers' Compensation. In addition, your refund may be offset if you are an employer in Ohio and are behind on workers' compensation premium payments.
Your Ohio tax refund is also subject to offset if you owe past due state or federal tax debt. If your past due tax debt is owed to the state, your refund offset is automatic; however the IRS offset process is not. If you owe delinquent federal taxes, the IRS must enter your account information into a matching database that identifies your account with the Ohio refund system. While the federal matching program is frequently used, an offset to pay federal taxes may not occur as quickly as state-initiated offsets.