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  • Will the Alabama Department of Revenue charge me any fees if my federal refund is offset to my state income tax debt?

Will the Alabama Department of Revenue charge me any fees if my federal refund is offset to my state income tax debt?

No. The Alabama Department of Revenue does not charge a fee. However, the U.S. Department of the Bureau of the Fiscal Service-Debt Management charges a fee ($22.58) to offset federal tax refunds to pay tax debts. Bureau of Fiscal Service-Debt Management will deduct that fee before sending the funds to the Alabama Department of Revenue.

No. The Alabama Department of Revenue does not charge a fee. However, the U.S. Department of the Bureau of the Fiscal Service-Debt Management charges a fee ($22.58) to offset federal tax refunds to pay tax debts. Bureau of Fiscal Service-Debt Management will deduct that fee before sending the funds to the Alabama Department of Revenue.

Related FAQs in Federal Refund Offset - TOP, Individual Income Tax

The Alabama Department of Revenue cannot stop an offset once you are notified by the U.S. Department of the Treasury’s Bureau of the Fiscal Service –Debt Management. We will refund any overpayment to you once it has been posted to your account.

Complete IRS Form 8379, Injured Spouse Allocation, and send it to the Internal Revenue Service (IRS) to get your share of the refund. You can download the form at http://www.irs.gov/pub/irs-pdf/f8379.pdf . You can also call the IRS at 800-829-3676, or visit a local IRS office.

An offset is when the Alabama Department of Revenue intercepts your income tax refund and applies the refund to a balance owed to the State of Alabama. If the full amount owed is not collected in 180 days, the Alabama Department of Revenue may offset future federal payments to satisfy your state tax debt.

Section 6402(e) of the United States Tax Code allows federal tax refunds to be offset to collect delinquent state income tax obligations. 31 U.S.C. § 3720A and other laws authorizes the Alabama Department of Revenue to enter into agreements with the Internal Revenue Service (IRS) and the U.S. Department of Treasury’s Bureau of the Fiscal Service -Debt Management to intercept or offset federal tax refunds and federal payments for State of Alabama income tax debts.

State and federal law authorizes the Alabama Department of Revenue to enter into agreements with the Internal Revenue Service (IRS) and the Department of the Bureau of the Fiscal Service-Debt Management to intercept or offset federal tax refunds and federal payments for Alabama state income tax debts.