Back in April, our blog discussed how the Social Security Administration was no longer taking advantage of the “offset program” run by the Treasury Department.
To recap, this program is essentially designed to confiscate tax refunds to satisfy outstanding debts owed to the federal government.
What made this announcement so noteworthy was that it became very clear via reports that the SSA hadn’t been using this program to go after people who were very clearly and very recently overpaid benefits. Rather, these reports revealed that many people were being forced to sacrifice their tax refunds to cover overpayments made to their parents or guardians decades earlier when they were only children and had no knowledge of any such benefits.
Interestingly enough, recent reports indicate that the offset program never really went away despite the assurances from Acting Social Security Commissioner Carolyn Colvin that these draconian debt collection measures were being abandoned and the confiscated tax refunds returned.
In fact, five plaintiffs, all of whom had their tax refunds returned only to see collections reinitiated months later, have filed a federal lawsuit against the SSA claiming that millions of dollars in tax refunds have been illegally confiscated from thousands of people “to satisfy dubious claims of debts based on alleged overpayments made decades ago.”
Specifically, the lawsuit alleges that these thousands of people never actually received any sort of government payment and that the SSA collected the millions of dollars in debts without providing any sort of notice.
“[The SSA’s] intention was to get the press off their backs and then go back to collecting their money,” said the lead attorney in the lawsuit. “It’s just shocking that they believe that when someone turns 18, they automatically assume a crushing debt that was incurred by someone else.”
It is truly something of a disappointment to see that the SSA may have neglected to alter their stance on this controversial program. Have you encountered this issue of the SSA reimbursing a tax refund before turning around and attempting to re-confiscate it?
Source: The Washington Post, “Social Security continuing to pursue claims against family members for old debts,” Marc Fisher, Dec. 13, 2014