true
  • Meet Claudell, one of our tax experts.
    TurboTax Live Assisted Basic
    File 100% FREE with expert help: Get live help from tax experts, plus a final review before you file — all free.
    Simple tax returns only.
    See if you qualify. Must file by 3/31.
Top
  1. TurboTax /
  2. Tax Calculators & Tips /
  3. Tax Tips Guides & Videos /
  4. Tax Payments /
  5. Video: Guide to Income Tax Refund Garnishment

Video: Guide to Income Tax Refund Garnishment

Updated for Tax Year 2022 • December 1, 2022 09:00 AM


OVERVIEW

Do you have some concern that your tax refund will be garnished by some of the creditors you owe money to? If so, you should know that their ability to garnish your tax refund depends on what the debt is for and who the original creditor is. Watch this video to find out more about tax refund garnishment.


TABLE OF CONTENTS

Video transcript:

Hello, I'm Scott from TurboTax, with important news for taxpayers about tax refund garnishments.

Do you have some concern that your tax refund will be garnished by some of the creditors you owe money to? If so, you should know that their ability to garnish your tax refund depends on what the debt is for and who the original creditor is.

If your creditor is eligible to garnish your tax refund, a request must be made to the Department of Treasury, which is the agency responsible for the IRS and issuing tax refunds. Generally, the only creditors that can garnish tax refunds are the IRS, Department of Education, and agencies collecting for unpaid child support. Other creditors might be able to garnish your checking or savings account holdings, but typically, they cannot intercept your Federal tax refund.

If the Treasury honors a request from an agency that can garnish refunds, the IRS should provide you with notice that your tax refund will be paid to your creditor. But if your refund is larger than the debt you owe, you should receive a tax refund for the difference.

When your creditor is the IRS, meaning you have other unpaid taxes, it's common practice for the agency to garnish your future tax refunds and apply them to your past-due tax balances.

And if you have debts with more than one eligible creditor, all future refunds are subject to garnishment until all debts are paid in full.

There is a payment priority that the Treasury must follow when garnishing your tax refunds.

The IRS will always use your tax refunds to satisfy your tax debt in full before sending your refund to other eligible creditors. Only then can your tax refund be used to pay off past-due amounts that you owe to other eligible creditors.

photo of the treasury department entrance

Let an expert do your taxes for you, start to finish with TurboTax Live Full Service. Or you can get your taxes done right, with experts by your side with TurboTax Live Assisted. File your own taxes with confidence using TurboTax. Just answer simple questions, and we’ll guide you through filing your taxes with confidence. Whichever way you choose, get your maximum refund guaranteed.

File 100% FREE with expert help

Get live help from tax experts plus a final review with Live Assisted Basic.

For simple tax returns only.
See if you qualify.
Limited time offer. Must file by 3/31.

$89$0*
State included

Get your max refund

Answer simple questions about your life and TurboTax Free Edition will take care of the rest.

For simple tax returns only
See if you qualify

Looking for more information?